'Tax consequences of wrongfully received and divided lottery winnings: money to be recovered from tax authorities'

In Spain, it is very common to share New Year's Eve lottery tickets with loved ones, friends, family or coworkers. This practice is perfectly legal as long as the necessary conditions are met and the prize is correctly obtained. Dozens of winning tickets in the Christmas Lottery Extraordinaire can even be shared via cell phones and apps such as WhatsApp.

The consumer and user organization is sharing all the key points of buying and sharing Christmas lottery tickets seamlessly. To share a ticket, the ticket holder must make a copy of the ticket and give each participant a signed copy stating that person is playing with that number, series, share and draw''for a certain amount.

It is also common to send a picture of the ticket via WhatsApp or email. It is enough to add a text like the following: "The persons listed below have purchased a ticket with this number (ticket details) for the National Lottery dated December 22, 2023. "

If you are sharing the ticket with your husband or wife, remember that if the marriage has community property, each will get 50%. If the economic treatment involves a division of property, the winnings belong to the person who bought the ticket unless it can be proven that it was bought in half.

Well, what happens if you don't properly claim the El Pride prize when the ticket is shared? The Tax Office can claim more money if you manage to get it right''identify the person with whom the ticket was shared.

The ticket holder should not cash the ticket in a bank without identifying the other participants. If "El Pride" is shared, the tax office withholds 20% of the amount, or €72,000.

But if one person receives the prize in full and shares it, it may appear that you have donated money, in which case you will have to pay inheritance and gift tax. This tax taxes any increase in the estate received as a reward by an individual. Lottery prizes distributed after''receipt, fall under the category of donations.

Remember that each person pays taxes depending on the autonomous community and the degree of kinship with the person receiving the ticket. For example, between brothers, donations are very expensive. In addition, interest increases according to predetermined income levels.

According to Larioja.com, if you were to share a large New Year's Eve lottery prize, the tax office would require you to pay a donation tax of €90,000. So if you don't want to get disappointed, document the joint ownership or co-ownership of the ticket by photocopying and document signed by all parties.

Learn more about the author/s of this article.

Conoce cómo'. 'we work at Business Insider.

Our most useful video content to help you progress in your professional and personal life

View more