Gifts made by bank transfer: when the statute of limitations period begins to run

The facts in dispute can be summarized as follows: for more than a year before his death, the appellant’s husband had been transferring a substantial amount of money to her from his accounts. Because the spouses were subject to the separate-property matrimonial regime (régimen económico-matrimonial de separación de bienes), the regional tax authorities took the view that the transfers made from one spouse to the other had to be classified as gifts and issued the corresponding tax assessments to her. The appellant, however, challenged some of those assessments on the grounds that they were time-barred.

The issue in dispute is precisely when the limitation period begins to run in cases such as this one. Specifically, the question is whether, for gifts evidenced by bank transfers that are reflected solely in the corresponding bank entries, the limitation period should be calculated from the time the tax authorities became aware of those gifts or from thirty business days after the date on which, according to those entries, the transfers were made.

The Supreme Court judgment (STS) of November 30, 2020, appeal n^o 4467/2018 establishes the following interpretive criteria:

• As regards the calculation of the limitation period for assessing, under the Inheritance and Gift Tax (ISD), the tax liability arising from gifts evidenced by bank transfers that are reflected solely in the corresponding bank entries, the period begins on the day following the expiry of the 30 business days (the voluntary payment period) after the date on which, according to those entries, the transfers were made.
• It can also be inferred from the Court’s reasoning that regulations dealing with the statute of limitations, an institution reinforced by the principle of statutory reserve (reserva de ley), are not admissible where they may alter the operation of the general rules for determining when the limitation period starts to run, as laid down in Article 67.1 of the General Tax Law (LGT), even if the purpose of the regulatory provision is to prevent the concealment of documents and tax fraud. Accordingly, through this criterion, the Supreme Court is giving priority to, and placing greater value on, the taxpayer’s legal certainty.

Finally, it should be noted that this judgment once again draws a clear and concise line for the authorities holding regulatory power, limiting their ability to use regulations to introduce rules that exceed the general framework established for tax institutions by the General Tax Law.

Clearly, this interpretation by the Supreme Court marks a turning point for the verification procedures currently being conducted by the Autonomous Communities (regions) and for those that have not yet become final because claims or appeals are pending, since the debts concerned may be time-barred under this new criterion. Under Article 69.3 of the LGT, the statute of limitations is applied ex officio, even where the tax debt has been paid, without the taxpayer (obligado tributario) needing to invoke it or raise it as a defense.

Therefore, with this interpretation the Supreme Court prevents gifts made by bank transfer, reflected solely in the corresponding bank entries and without the transaction being recorded in any private document, from becoming de facto exempt from any statute of limitations. That would be the consequence of continuing to apply Article 48.2 in such cases, as the High Court of Justice (TSJ) of Madrid did in the lower-court judgment, since that provision would open up the possibility of the tax authorities verifying such gifts sine die, with the resulting negative effects from the standpoint of the principle of legal certainty.