Short answer: if you gift a property in Andalusia to your children, grandchildren, spouse or parents (groups I and II), they receive a 99% relief on Spanish gift tax, provided the gift is made in a notarial deed . This applies even if donor and recipient do not live in Spain. But a gift is not free: the donor pays tax on the capital gain on the property as if they had sold it, the recipient pays the plusvalía municipal, and your home country may also levy tax. Always have it calculated beforehand.
More and more owners of a home on the Costa del Sol are thinking of passing it on to their children during their lifetime. Andalusia makes this tax-efficient, but there are catches. In this article you'll read which taxes apply, who pays what and what to watch out for if you live abroad.
Is it an inheritance rather than a gift? Then read inheritance tax in Spain. You'll find all the rules on buying, owning and selling in our tax and law guide.
Which taxes apply to a gift?
| Tax | Who pays? | On what? |
|---|---|---|
| Gift tax (Impuesto sobre Donaciones) | The recipient | The value of the property, with a 99% relief in Andalusia for groups I and II |
| Capital gains tax | The donor | The difference between the value on the day of the gift and the purchase price (plus costs) |
| Plusvalía municipal | The recipient | The increase in land value since the previous transfer |
| Tax in your home country | Depends on the country | According to your country's rules |
Many people are surprised that the donor pays tax on a property they give away. But that's how it works: for capital gains purposes, the Spanish Tax Agency treats a gift as a transfer. If the value has fallen, you cannot deduct the loss.
The Andalusian 99% relief: the conditions
The Andalusian tax law (Ley 5/2021 on ceded taxes) grants a 99% relief on gift tax for gifts to recipients in:
- Group I: children and grandchildren under 21;
- Group II: children and grandchildren aged 21 or over, the spouse or registered partner, parents and grandparents.
The conditions, as explained by the Andalusian Tax Agency in a binding ruling (consulta 3/24):
- The gift is made in a notarial deed (escritura pública), with the asset transferred at the same time.
- For gifts of money, the origin of the money must be proven and stated in the deed. A cash gift must be formalised in a deed within one month of the transfer.
- The recipient's existing wealth does not matter.
Brothers, sisters, nephews and nieces (group III) and non-relatives do not qualify and pay the full rate.
Does this also apply if you don't live in Spain?
Yes. When a property in Spain is gifted, a donor and recipient who don't live in Spain apply the rules of the region where the property is located. For a property in Marbella, Benahavís or Estepona that is Andalusia, with the 99% relief. This is set out in the Spanish inheritance and gift tax law (Ley 29/1987, second additional provision) and, following case law, also applies to residents outside the EU.
The return is filed with modelo 651, within 30 working days after the gift.
The donor's capital gain
The donor pays Spanish tax on the difference between the property's value at the time of the gift and what they originally paid, plus purchase costs and certain improvements.
- If the donor doesn't live in Spain, the rate is 19% and they file using modelo 210.
- If the donor lives in Spain, the gain goes into their normal return (rates from 19 to 30%). A resident over 65 who gifts their own main residence is exempt.
For a property that has been in the family for a long time and has risen sharply in value, that gain can be substantial. So first work out what a gift costs compared with an inheritance later, which also enjoys favourable rules in Andalusia.
The plusvalía municipal
With a gift, the municipal tax on the increase in land value is paid by the recipient. The amount depends on the cadastral value of the land and the number of years since the previous transfer. Since late 2021 you choose the more favourable of two calculations, and if there is no gain, you pay nothing. Read all about it in plusvalía municipal.
And in your home country?
Your home country may also tax a gift. If the donor lives in the Netherlands, Dutch gift tax may also be due, with rules to limit double taxation. In Belgium the rules differ by region and type of asset. Have your notary or tax adviser at home check what applies to you before you sign in Spain.
Gift or inheritance: a comparison
| Gift | Inheritance | |
|---|---|---|
| Spanish tax for children in Andalusia | 99% relief | Reduction of 1 million euros per heir, then 99% relief |
| Capital gains tax for the owner | Yes | No, an inheritance triggers no capital gains tax |
| Plusvalía municipal | Yes, for the recipient | Yes, for the heirs |
| When? | Now, and you stay in control | Later, with a will |
A middle way is gifting the bare ownership (nuda propiedad), while you keep the usufruct : you keep living there or letting it, and your children become the owners. The taxes above still apply, on a lower value. Always have such a structure drawn up by a lawyer.
Steps for a gift
- Have the property valued and the taxes calculated by a Spanish tax adviser and an adviser in your home country.
- All parties need a NIE number .
- Sign the deed of gift at a Spanish notary, or be represented under a power of attorney.
- Within 30 working days the recipient files modelo 651 and pays the plusvalía.
- The donor declares the gain (modelo 210 as a non-resident).
- The deed is registered at the Land Registry and the IBI is put in the new owner's name.
Thinking of passing your Spanish home on to your children? We'll put you in touch with an independent tax adviser who knows both countries. No obligation, and in your language.
Ask your questionSend us a WhatsAppRead also: inheritance tax in Spain, tax on a second home, plusvalía municipal and our tax and law guide.
This article is part of our guide to tax and law for property in Spain: all the rules for buying, owning, renting out, selling and inheriting in one place, checked every month.
Frequently asked questions
How much tax do you pay when gifting a property to your child in Andalusia?
Your child receives a 99% relief on gift tax if the gift is made in a notarial deed. As the donor you also pay tax on the property's capital gain, and your child pays the plusvalía municipal.
Does the Andalusian relief apply if we live abroad?
Yes. For a property in Andalusia, a donor and recipient who don't live in Spain apply the Andalusian rules.
Does the donor have to pay tax?
Yes, on the capital gain: the difference between the value at the time of the gift and the purchase price plus costs. As a non-resident at 19%, with modelo 210.
Who pays the plusvalía municipal on a gift?
The recipient of the property.
What is the deadline for declaring a gift?
Within 30 working days of the gift, with modelo 651.
Is gifting cheaper than inheritance?
Not always. With an inheritance there is no capital gains tax, and children in Andalusia get a 1 million euro reduction. Have both scenarios calculated.
Sources
- Junta de Andalucía, Agencia Tributaria de Andalucía, binding ruling consulta 3/24 on the 99% relief for gifts (2024)
- Guiafiscal, Impuesto de donaciones en Andalucía 2026 (updated 28 August 2026)
- Tinsa, Donación de una vivienda a un hijo: impuestos (1 September 2026)
- Ley 29/1987 del Impuesto sobre Sucesiones y Donaciones, second additional provision (non-residents)
- Ley 5/2021 de tributos cedidos de la Comunidad Autónoma de Andalucía
Written by the Imagine Marbella editorial team. Updated October 2026. This is general information, not tax advice: always have your situation calculated by a tax adviser in Spain and in your home country.
