TAX REGULATIONS OF ASSURED SAVINGS PLANS

General provisions relating to the historic territories of Álava, Guipúzco and Vizcaya.

Taxation of premiums

Qualifying premiums for assured savings plans which meet the preceding requirements, may be offset against basic IRPF up to 8,000 euros per annum. Nevertheless, contributors aged over 52 years shall have a higher limit of an extra 1,250 euros for every additional year of age in excess of 52 up to a total maximum limit of 24,250 euros.

This maximum limit is combined with all social security benefits and contributions (employers contributions are not included).

Regardless of reductions made in accordance with the above limits, in the case of contributors whose spouses or partners do not receive income to be included in the general taxable base, or who receive less than 8,000 euros per annum, the taxable income may be reduced by the amounts paid into assured savings plans effected in the spouse or partners name, up to a limit of 2,400 euros per annum (these contributions shall not be subject to ISD).

Where these previously mentioned provisions do not produce a reduction in the taxable base, due to the insuffiency hereof, reductions may be made in the five following tax years.

Payments made towards assured savings plans, for the benefit of persons with 65% or more physical or sensorial disability, psychiatric deficiency of more than 33%, as well as for any person with a judicially declared incapacity regardless of the degree thereof, with whom there exists a family relationship up to the third degree of consanguinity, or one of spouse or partner, or state of guardianship or trusteeship, may qualify for reduction in the taxable base with the following limits (these payments shall not be subject ISD):

• 8.000 € per annum, without affecting payments which maybe made to their own assured saving plans.
• Payments made by persons with partial incapacity, with a limit 24,250 euros per annum.
• The total of the reductions made for all persons who make payments in favour of the same person with incapacity, may not exceed 24,250 euros per annum, including those of the person with incapacity himself. For these purposes, when there are several payments in favour of a person with incapacity, the reduction will be applied, in the first place, to the payments made by the person with incapacity himself and only if these do not exceed the limit of 24,250 euros per annum, the payment made by other persons in his favour may be the subject of a reduction in their taxable bases, on a proportional basis.

All the deduction limits previously mentioned shall be added together for the total of payments made for the contributors to pension plans, social security mutual benefits, assured savings plans, company savings plans and dependency insurance.

Taxation of benefits

All benefits received by the beneficiaries of assured savings plans shall be considered personal income from work, regardless of whether they arise from except from cases of survival or death.

In general the benefits received in form of capital sums shall be paid in total. Nevertheless this payment shall be 60% in the following circumstances:

• In the case of the first benefit that is payable, always assuming that more than two years have passed from the first payment. The passage of two years shall not be required in the case of benefits for incapacity or dependency.
• In the case of subsequent benefits for the same contingency referred to in the last paragraph, received five years after the previous payment, when the qualifying payments have sufficient periodicity and regularity in the terms established in the rules. For this purpose, the first benefit will be understood to mean the total of the amounts received in form of capital sums in the same tax year for the occurrence of each contingency. The same rule shall be applied to the subsequent payments i referred to in the previous paragraph. The rule specified in this section shall also be applied to the amounts received in the event of grave illness or long term unemployment.

Amounts to be retained for tax

The yield from work derived from payments under these assured savings plans are subject to a retention on account of I.R.P.F., AT percentages determined in each case, according to the personal circumstances of the recipient.

THIS TYPE OF INSURANCE SHALL BE SUBJECT TO THE TAX BENEFITS THAT THE LAWS DETERMINES AT ALL TIMES.