See how to make a donation of assets during your lifetime and avoid conflicts between heirs

Donating assets during your lifetime can be an effective strategy to prevent disputes between heirs. However, there are common questions about this process, such as whether all assets can be donated, what taxes apply, and how to make a donation legally. This article clarifies these questions and the steps to be taken for a real estate donation.

What does a donation of assets during life mean?

The legal definition of donation is found in § 1 of article 940 of the Civil Code: “a donation is the contract by which a person, in a spirit of liberality and at the expense of his or her assets, disposes of a thing or a right free of charge, or assumes an obligation for the benefit of the other contracting party”. In practical terms, it is a contract where the donor transfers an asset to the donee, renouncing ownership of the asset.

Essential conditions for donation

There are three requirements to consider:

1. Future assets cannot be donated.
2. The donation must be made while alive.
3. The donor must personally define the contract and the beneficiarywithout delegating these decisions.

How to make a donation?

To make a donation, the donor must have legal capacity, in accordance with article 948 of the Civil Code. The donation may involve movable or immovable property. Let’s look at a concrete example of a property donation, such as the case of a mother who donates an apartment to her daughter:

Step 1: Gather the necessary documents

To donate a property, the donor needs the following documents:

• Identity Card or Citizen Card of the donor and donee.
• Housing license.
• Certificate of content from the Land Registry and updated Land Registry.

Step 2: Evaluate the usufruct reserve

The usufruct reservation allows the donor to continue using the donated asset, as a protection for possible future needs. This mechanism is important for those who donate property, as it preserves the right of use, even after the transfer of ownership.

Step 3: Carry out the donation deed

The donation of real estate must be formalized by public deed at a Notary’s Office, where taxes are also collected and the property is registered.

Donation taxes

The tax burden on donations depends on the degree of kinship between the donor and the beneficiary. According to the Stamp Duty Code (CIS), donations between direct family members (descendants, ascendants and spouses) are exempt from stamp duty. For other cases, a rate of 10% applies to movable assets and 0.8% to immovable assets.

Revocation of donations

The Civil Code provides that a donation can be revoked in specific circumstances:

• If the beneficiary or descendants predecease the donor.
• If the donee is considered “ungrateful” for serious acts, such as crimes against the donor.

However, some donations are irrevocable, such as those made for marital or gratification purposes, or when the donor forgives the donee. Furthermore, revocation cannot be executed after the death of the donee, except in cases of homicide of the donor.

Nullity situations

Certain donations are void, including those made between spouses under a separation of property regime, between people involved in adultery, or between patients and their caregivers during the terminal phase of the illness.

Choosing to donate assets during your lifetime can avoid future family conflicts, providing legal certainty and clarity about the ownership of the assets. The process, which involves few steps, can be carried out in one, speeding up and simplifying the procedure.

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