Nowadays it is more and more frequent the equalization of rights between married couples and couples formalized through a common law partnership.
Among other things, there are tax benefits and bonuses that both models can use in their favor, as it happens in the case we are going to discuss in this post. Of course, it is very important to strictly comply with the registration requirements of the regulations to avoid lawsuits and conflicts such as the one described in the following sentence.
This specific case reached the Constitutional Court.
Domestic partnership and tax benefits: proper registration is key
The ruling of the Constitutional Court analyzes the case of a Madrid unmarried couple registered in the registry of the Madrid City Council.
He decided to donate 50% of the family home to his partner, applying the 99% rebate provided for in articles 25.2.1 and 26 of the Consolidated Text of the Legal Provisions of the Community of Madrid on taxes ceded by the State.
Henceforth, she would assume the payment of half of the mortgage.
At the time of presenting the liquidation of the inheritance and gift tax, they paid an amount of 48.78 euros.
However, the tax authorities revised the liquidation and calculated an amount of 9,355.15, based precisely on an incorrect registration of the common-law marriage. By going to court, the ruling of the lower court upheld the couple’s claim against the Administration, granting them the tax credit.
However, this judgment was overturned in cassation, The court based its decision on the fact that the couple was not registered in the specific registry provided for in Law 11/2001, of December 19, 2001, of unmarried couples of the Community of Madrid.
The debate focuses, therefore, on whether the registration of the unmarried couple in the Registry of Unmarried Couples of the Community of Madrid is an essential formal condition, as literally stated in the Law of Unmarried Couples of the Community of Madrid.
In conclusion, the Constitutional Court agrees with the couple and assures that, with its decision, the regional court of cassation “has caused as an immediate consequence the exclusion of the appellant from the scope of application of a tax benefit legally provided for de facto unions, unreasonably establishing a difference in treatment that not only lacks sufficient objective justification, but also causes a consequence that is excessively burdensome.”
“The legislator has decided to grant the same treatment in the Inheritance and Gift Tax to marriages and registered de facto unions, so that -in order to prove the condition of de facto union- the judicial bodies must carry out an integrating interpretation of the rule that, to that effect, allows to recognize the effectiveness of the inscription in other official registries when it is conditioned to the fulfillment of the same material requirements that allow its inscription in the autonomous registry, since this interpretation of the norm, which was recognized by the sentence of instance, guarantees the legal security and, at the same time, the equality before the law demanded by the Constitution”.the sentence states.
These conclusions lead directly to the granting of the protection requested by the couple, declaring firm the recognition of the right to the application of the tax credit provided for de facto unions that was made by the judgment of first instance.
From this sentence we can extract a key criterion: once the registration of a domestic partnership in the registry of a municipality, or even in a ‘similar’ instrument, the formal requirement of registration of the domestic partnership must be considered fulfilled; without it being necessary or legitimate to make another identical or contradictory declaration before another public official.
In addition, the Constitutional Court points out the problem posed by the absence of a state regulation in this regard: it is not “difficult to appreciate the dysfunctions that may arise due to the absence of a state regulation defining the legal status of common-law couples.” In this sense, “it is necessary that the lack of coordination between registries does not go to the detriment of the administered”,which can cause possible discrimination based on the place where the registration was made.
This case serves to remind us of the importance of carefully analyzing each legal step related to our family relationships, especially when they have economic transcendence or when they may affect our children.
While the content of this ruling is very good news, let us not forget the long judicial road that this couple has had to travel to have their rights recognized.
When in doubt, consult a family lawyer to help you not to leave any loose end: protecting your rights and those of your children is an act of responsibility that will allow you to rest better and build a firm family nucleus, taking advantage of all the benefits offered by the law.
