Pablo is 31 and works in Valencia. He has found a flat for 210,000 € and the bank will lend him 80 %. His parents, who live in Castellón, are going to transfer 40,000 € to him for the deposit and the costs. At the estate agency they told him that "you don't need to declare that, it's family". He does need to. It is a gift of money, and whether it turns out cheap or expensive depends largely on how it is done and on whether it is declared in time.
A transfer between parents and children is a gift
The Spanish inheritance and gift tax (Impuesto sobre Sucesiones y Donaciones, ISD) taxes gratuitous acquisitions between living persons, and the recipient is the one who must pay (article 5.b of Law 29/1987). There is no exempt minimum amount in the State law: 40,000 € is taxed just like 4,000 €, although with small amounts the tax is small.
Nor does it help to present it as "help" or "an advance". The tax authorities see the money leave the parents' account and arrive in the child's, and article 4.1 of the law presumes there is a gratuitous transfer when one person's assets decrease and, within the limitation period, those of their spouse, descendants, heirs or legatees increase. That presumption can be rebutted, but the taxpayer has to supply the proof.
Which region collects: the child's
For assets that are not real estate, and money is not, article 32.2.c) of Law 22/2009 assigns the tax to the autonomous community (Spain's regions) where the recipient has their habitual residence on the date of the gift. It does not matter where the parents live or which bank holds the money.
That residence is measured with the five-year rule: the community where Pablo has spent the most days in the five years before the gift (article 28.1.1.º.b of the same law). If he moved to Valencia from Madrid two years ago, the competent community could still be Madrid. We explain it step by step in which autonomous community applies; the count works the same way for the recipient of a gift as for the deceased in an inheritance.
If Pablo lived outside Spain, the rules would change completely; that is covered in parents who live abroad and want to give money.
The deadline: 30 working days
Article 67.1.b) of the tax's Regulations gives thirty working days from the day after the gift to file the self-assessment. Working days means excluding Saturdays, Sundays and public holidays.
In practice that is about six weeks. If Pablo's parents make the transfer on Monday 5 October 2026, the count starts on Tuesday the 6th and, leaving out weekends and 12 October, ends around mid-November. The exact day depends on the regional and local holidays that fall in between, so it is best to work it out with the region's official calendar and not leave it to the last minute.
The tax accrues on the day the act takes place or is executed (article 24.2 of the law). If a deed of gift is signed and the transfer is made a few days later, the relevant date is that of the deed. If there is no deed, it is the date of the transfer.
Many regions greatly reduce the tax on gifts from parents to children, but make it conditional on formal requirements: a public deed, a record of where the funds come from, the money being moved by bank transfer, sometimes that it is used for a habitual home or that the return is filed on time. If one is missing, the whole benefit is lost. Before transferring, check what the rules of the child's region of residence require on the date of the gift.
One donor or two: the same amount does not cost the same
The tax is progressive and is calculated for each donor-recipient pair. If the money belongs to both parents, it makes sense for it to be recorded as two gifts, one from each parent, of half each.
With the State scale in article 21, and no regional benefits (the region will apply its own), the effect looks like this:
- A single gift of 40,000 €. The State rules do not reduce the base on gifts (article 20.5). Tax: 3,734.59 € for the first 39,943.26 € plus 11.9 % of 56.74 € = 3,741.34 €.
- Two gifts of 20,000 €, one from the father and one from the mother. Each one: 1,290.43 € + 9.35 % of 4,019.09 € = 1,666.21 €. Total: 3,332.42 €.
- Difference: 408.92 € simply by reflecting who really owns the money.
This is not a trick: if the money is community property or sits in a joint account, in law both parents are giving it. What would be wrong is the reverse, attributing to both of them money that belongs to only one.
| How it is done | Gifts | Tax on the State scale |
|---|---|---|
| One parent gives 40,000 € | 1 | 3,741.34 € |
| Each parent gives 20,000 € | 2 | 3,332.42 € |
| Same donor, 20,000 € now and 20,000 € in two years | 2, but added together | average rate calculated on 40,000 € |
The third row reflects the limit: article 30.1 of the law adds together the gifts from the same donor to the same recipient within a period of three years. Spreading them over time does not lower the rate unless three years pass between one and the next.
The bank trail
The trail you want to leave is simple and linear:
- a transfer from the parents' account (or from each parent's) to Pablo's account, with the reference "gift";
- a deed of gift, if the region requires one or if you want to prove the date and origin, identifying the transfer;
- payment of the deposit or the purchase price from Pablo's account.
What causes problems is money that passes from hand to hand, cash withdrawals, or the parents paying the seller directly at the notary's without it being recorded as a gift. In that last case the gift exists all the same (the parents pay part of the price of an asset belonging to Pablo) and, on top of that, there is no document to support it. The bank granting the mortgage will also ask where the funds come from, under its anti-money-laundering rules.
And what if we call it a loan?
Some families prefer to document a loan. That is legitimate if it is a real loan: a written contract with a date, term and amount, periodic repayments that can be seen in the bank and, where appropriate, interest. A "loan" without repayments that nobody expects to collect is a badly disguised gift, and the presumption in article 4.1 works in favour of the tax authorities.
What does not happen in income tax
Two pieces of good news. The parents have no capital gain in their income tax (IRPF) for giving money, because money does not increase in value; that would happen if they gave a property or shares (we compare this in whether a lifetime gift is cheaper than an inheritance). And Pablo does not declare the gift as income in his income tax: it is taxed only under gift tax.
If you are going to receive or make a gift for a home, send us the amounts, residences and planned dates in the inheritance form before moving the money; we check what formalities the region requires.
Pablo received two transfers, one from each parent, signed the deed of gift that same week and filed on time. The purchase was signed a month later without any questions from the bank.
When the money comes from parents who live in another country, the analysis is different; we deal with it at Salama Tax for inheritance and gifts, coordinating with the adviser the family has in their home country.