In general, recipients of donations are subject to taxation under the Stamp Duty tax. Regarding monetary donations, under article 1, paragraph 5, subparagraph g) of the Stamp Duty Code (CIS), donations between spouses or de facto partners, descendants, and ascendants up to the amount of 5,000 euros are not subject to stamp duty.
Furthermore, regardless of the amount given, free transfers to spouses, descendants, and ascendants are exempt from Stamp Duty, according to article 6, subparagraph e) of the CIS.
Addressing the question raised, a donation from a parent to a child up to 5,000 euros is not subject to taxation (article 1, paragraph 5, subparagraph g) of the CIS), and if it exceeds this amount, it does not incur a tax since it is exempt under article 6, paragraph 1, subparagraph e) of the CIS.
Regarding whether the donation must be declared, the response is as follows:
– For donations up to 5,000 euros, there is no obligation to report to the Tax Authority;
– For donations beyond 5,000 euros, there is an obligation to declare, through the completion of Stamp Duty Form 1, by the end of the third month following the donation.
If the beneficiary chooses not to declare, it should be noted that the Tax Authority may detect these amounts, especially when the donation is made through bank transfer. In this case, even if there is no tax due because it falls under one of the exempt situations (free transfers to spouses, descendants, and ascendants), there could be a fine of 150 to 3,750 euros, since article 116, paragraph 1 of the General Regime of Tax Infractions states that “the absence of declarations that must be submitted for tax purposes so that the tax administration specifically determines, evaluates, or verifies the taxable amount, as well as their submission beyond the legal deadline, is punishable with a fine of (euro) 150 to (euro) 3,750.”
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Dantas Rodrigues has been a lawyer since 1993 and is a partner at Dantas Rodrigues & Associados. He has also been a professor of Law at Higher Polytechnic Education since 1995.
