These transfers may benefit from a 95% reduction in the Inheritance and Gift Tax, provided a series of requirements are met:
1. Activity requirements
The company must carry on an economic activity, and this is the case for holding companies, or companies whose corporate purpose is the leasing of real estate, if they have employees.
The deceased’s direct shareholding in the company must have been at least 50% when computed individually, or 20% at family group level.
The transferor must perform management functions and receive for them a remuneration equivalent to at least 50% of all their business, professional and employment income.
2. Requirements of the transfer
The reduction will apply to the spouse, descendants or adopted children and, if there are none, to ascendants and collateral relatives up to the third degree. The shareholdings must be kept in the estate of the heir or legatee for between 5 and 10 years depending on the autonomous community.