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50-0 LIFE ANNUITY

The best option for reducing your taxes if you are going to sell some of your assets.

If you are over 65 years old, enjoy a tax exemption1 when you sell these assets by taking out the 50-0 Life Annuity.
Renta vitalicia capital 50-0

With the 50-0 Life Annuity, two income options are available to you:

  • 50 Capital Annuity

    Use up 50% of the premium paid in.

    The insured death capital falls 5% a year up until the 10th year, providing an insured death capital of 50% of the premium from that year.

  • 0 Capital Annuity

    Use up 100% of the premium paid in.

    The insured death capital falls 5% a year, but, unlike with the 50 Capital Annuity, the insured capital from the tenth year continues falling 5% a year until 100% of the capital is used up, meaning that the income that the policyholder receives will be higher than they would have received with the 50 Capital Life Annuity.

Optimised taxes

If you are over 65 years old, you can enjoy tax exemptions on any capital gains that you make on asset transfers.

From 65 years old and up

You can take out the 50-0 Capital Annuity from 65 years old and up.

From 30,000 euros

The minimum premium amount is €30,000, which is paid as a single lump sum, with no additional contributions.

See Terms and conditions Terms and conditions

50-0 Life Annuity Terms and Conditions

  • Age

    You can take out the 50-0 Life Annuity from 65 to 85 years old.

  • Amount

    The minimum premium amount for the 50-0 Life Annuity is 30,000 euros, which is paid as a single lump sum, with no additional contributions.

  • Interest

    There is a technical interest rate, which is fixed in advance and is insured. It does not vary based on market performance. Please check with our managers.

  • Frequency

    You can choose from the following annuity payment options: Monthly, quarterly, half-yearly or annually. The start date will depend on the frequency chosen. For example, for monthly payments, you will receive the first income payment in the month after it is set up.

  • Coverage

    The 50-0 Capital Annuity provides the following coverage:

    • Over your entire life: It provides you with a fixed and constant income throughout your life or until it is redeemed.
    • Should you die: Depending on the coverage chosen, beneficiaries will receive the capital set out in the table below:
    Years since the life annuity was set up
    50 Capital
    % of insured capital paid to the beneficiary
    0 Capital
    % of insured capital paid to the beneficiary
    1st;
    95%
    95%
    2nd
    90%
    90%
    3rd
    85%
    85%
    4th
    80%
    80%
    5th;
    75%
    75%
    6th
    70%
    70%
    7th
    65%
    65%
    8th
    60%
    60%
    9th
    55%
    55%
    10th
    50%
    50%
    11th
    50%
    45%
    12th
    50%
    40%
    13th
    50%
    35%
    14th
    50%
    30%
    15th
    50%
    25%
    16th
    50%
    20%
    17th
    50%
    15%
    18th
    50%
    10%
    19th
    50%
    5%
    20th and subsequent
    50%
    0%
  • Liquidity

    Even though this product is intended to last your whole life, you can request to withdraw the premium starting from the first year after it is taken out. Should you do this, you will always withdraw all of the premium.

    If you cancel the product, the amount that you redeem may be less than the amount that you initially contributed, and you will have to repay all of the income that would have been tax-exempt to the Spanish Tax Agency.

  • Beneficiaries

    As this is a life-savings insurance product, you can specify the beneficiaries. This will help you to plan and manage how your financial assets will be inherited.

  • Taxes

    Payments received are treated as capital gains and are subject to withholdings at the current rate in the autonomous community in question.

    The percentage tax paid as personal income tax on annuities depends on the age of the investor or insured party when the policy is taken out:

    AGE WHEN THE ANNUITY IS SET UP
    % OF INCOME EXEMPT FROM TAXATION
    % OF INCOME TREATED AS CAPITAL GAINS
    Over 70 years old
    92%
    8%
    Between 66 and 69 years old
    80%
    20%
    Between 60 and 65 years old
    76%
    24%
    Between 50 and 59 years old
    72%
    28%
    Between 40 and 49 years old
    65%
    35%
    Under 40 years old
    60%
    40%

    Should the insured party die, the payments received by the beneficiaries will be subject to the Inheritance and Donations Tax.

See Taxation Taxation

Insured income taxation

In the case of collection in the form of an immediate annuity, the amounts received will be considered as capital gains, in a percentage that depends on the age of the beneficiary when they contracted the policy. The percentages are:

Age when constituting the income
% of income exempt from taxation
% of income considered capital gains
Over 70 years old
92%
8%
Between 66 and 69 years
80%
20%
Between 60 and 65 years
76%
24%
Between 50 and 59 years
72%
28%
Between 40 and 49 years
65%
35%
Under 40 years old
60%
40%

Redemptions: in insurance redemptions, the difference between the amount received as the redemption and the single premium paid plus the part of the income so far received that was exempt from taxation due to the application of the percentages shown in the previous table is regarded as a capital gain. These capital gains are subject to withholdings at the current rate in the respective autonomous community.

Death of the insured: The payments received by a person other than the policy holder will be subject to Inheritance and Donations Tax.
Depending on the degree of kinship (spouse, ascendant, descendant), these payments may qualify for certain reductions (€9,195 per beneficiary), which will depend on the autonomous community in question.

See FAQs FAQs

Can I make additional contributions after taking out an annuity?

With life annuities, you cannot make additional contributions to the initial premium, but you can take out another life annuity.

Can I change the frequency of the payments once I have started receiving them?

No, you cannot change the frequency of the payments once the life annuity has been set up.

What is the minimum amount that you must pay as a premium when taking out an annuity?

You can take out an annuity from €30,000, in either of the two forms.

What are the eligibility criteria for personal income tax exemptions?

In order to be eligible for personal income tax exemptions on capital gains arising from transferring assets which are subsequently reinvested in life annuities, you must fulfil the following requirements:

  • The policyholder must be 65 years old or more.
  • The life annuity must be set up within a maximum period of six months from the date that the asset is transferred.
  • The life annuity must start to be received within a year of it being set up and be paid out at least annually, and the annual pay-out amount cannot fall more than 5% compared to the previous year.
  • The taxable person must inform the insurance company that the life annuity taken out is used for reinvesting the amount arising from transferring assets.
  • The maximum total amount that can be reinvested is 240,000 euros. The maximum that a taxpayer can pay throughout their life is €240,000. If the reinvested amount is less than the total obtained, the exempt capital gain will be calculated proportionally to the reinvested amount.
  • When the reinvestment is not made in the same year as the sale, the taxable person must declare their intention to reinvest this amount in the tax return for the year when this equity increase occurs.

How is income received taxed?

The payments received are treated as capital gains. Capital gains are subject to a 19% withholding that is included in the savings base and subject to a proportional rate, ranging from 19% to 26%. However, annuities have a distinctive tax advantage: The capital gains are included in the savings base, but only at a percentage of the annual income received. This rate is based on the age of the insured person when they take out the insurance. For example, if it is taken out at 70 years of age, the percentage of the income that is taxed is only 1.52% instead of 19%, provided that the total returns generated do not reach 6,000 euros.

Can I recover my initial life investment?

In an ideal world, the policyholder would not have to redeem the product, since it is meant to be a lifelong product. It can be redeemed from the first year, but this may mean that the amount that you redeem may be less than the amount that you initially contributed, and that you will have to repay all of the income that would have been tax-exempt to the Spanish Tax Agency.

If the annuity is redeemed, the policyholder will receive the lowest of the following amounts:

  • 100% of the mathematical provision when the annuity is redeemed.
  • The death capital when the annuity is redeemed.
  • The realisable market value of the assets under the policy when the annuity is redeemed*.

(*) The insurance company will invest the premium in fixed-income products, mainly debt issued by governments and other public bodies in the eurozone, as well as private fixed-income assets from issuers in the eurozone. Should the annuity be redeemed, there must be a divestment, transferring the amount of this to the customer if it is less than the initial value.

Who can I assign as the beneficiary?

As this is a life-savings insurance product, you can specify the beneficiaries.

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