Growth Plan
Growth Plan
Growth Plan is a saving insurance that allows you to invest in the term that interests you most: 1, 2, 3, 5, 8, 10 or 14 years.
Especially recommended for:
- Obtain a guaranteed profitability for your savings, in the middle or long-term.
- Accumulate profits obtained on the capital with the purpose of improving the financial and tax profitability.
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Characteristics
- Amount : minimum of 600 euros
- Type of contributions : you will be able to invest for 1, 2, 3, 5, 8, 10 or 14 years
- Profitability : is related to the period selected.
- Availability : you will be able to have your money if you need it at any time for periods over 8 years, from the seventh month for the 2 and 3 year contracts and, from the second year onwards, for 5 year contracts.
- Additional services : you will obtain the benefits of life insurance, as you will be able to name the beneficiaries who, in the case of the death of the plan titleholder, will receive the accumulated capital increased by 10% 1.
1 Up to a maximum of 12,000 € and 600 € in the case of planholders aged over 65 or with aggravated risks.
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- Taxation
1. Residents
Personal income tax
The return accumulates without any withholding and is only subject to taxation when surrendered.
Return on live-savings insurance received in the form of capital, as is the case of Plan Crecimiento, pay tax as investment income and form part of the Savings Tax Base. The tax rate applicable to the Savings Tax Base is 21% for the first 6,000 euros and 21% as from 6,000.01 euros. A 21% withholding is applied when surrender occurs.
From 1 January 2007 the 40% and 75% reduction percentages have been eliminated when surrender occurs for the return of premiums over 2 years old or more than 5 years respectively.
However, there is a Transitory system which establishes that tax payers who receive deferred capital from the surrender of individual life or disability contracts effected prior to 20 January 2006 may enjoy a tax offset as provided in the Law on the General State Budget in the event the application of the new system is less favourable than the current system. For this purpose, only the premiums paid until 19 January 2006 will be taken into account together with the ordinary premiums provided in the original policy of the contract and paid subsequent to that date.
Inheritance tax
In the event of the holder’s death, his beneficiaries must pay Death duty and Gift tax for the amount received, with the particularity that being life insurance, if the relation of the beneficiary with the deceased holder is spouse, ascendant, descendant, adopting or adopted, a 100% reduction will be applied with a limit of 9,195.49 euros (*)
(*) Variable amount dependent upon the Autonomous Community
2. Non-residents in Spain
In savings insurance, to accumulate capital, the interest is taxable only when redemption occurs.
According to the country of residence the tax percentage applied will be different:
- For citizens resident in countries where there is a double taxation treaty with Spain, that establishes the taxation rate at zero rate or a reduced rate, this zero or reduced rate will be applied when residence is accredited via a tax residence certificate issued by the tax authority of the country of tax residence. The tax residence certificate must be no older than one year on the date that the returns are obtained.
- For citizens resident in countries that do not have a double taxation treaty with Spain or who do not provide their fiscal residence certificate, tax will be applied at a rate of 24% on the entire yield obtained.