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Spanish inheritance tax laws

YOUR GUIDE TO SPANISH INHERITANCE TAX

Laws governing inheritance tax in Spain are much more complicated than those in other countries. In addition, they are potentially far more punitive.

So let us help you. This guide explains Spanish inheritance tax rules applicable to the whole country. As a result, regional variations exist. So contact us for a free consultation.

As a consequence of the varying tax laws in Spain, inheritance taxes can be particularly puzzling.  Furthermore, regional taxes will only apply to habitual residents (ie. residents in Spain for at least five years), while national law apply to non-residents. In addition, some regions have more favourable conditions., so it’s important to speak to a local lawyer.

So if you own a property in Spain, this can ultimately affect you. Therefore, it is advisable to seek qualified professional advice in order to make the best arrangements for you and your family. Similarly, Inheritance tax in Spain is most likely very different to your country of origin. As a result many come to us with with confused about the Spanish inheritance tax system. So, let us help you with the basics…

SPANISH WILLS

A foreign Will is valid under Spanish Law if it meets the requirements of the Spanish Civil Code and the provisions of the Hague Convention on recognition of Wills.

However it is very advisable to execute a separate Spanish Will for the assets located in Spain. In case of decease, if a Spanish Will has not been proved and registered with the Last Wills Central Registry in Madrid, the beneficiaries will go through a long, highly bureaucratic and expensive process in order to receive the assets in Spain.

The Inheritance procedure without Spanish Will can take up to two years and the Spanish authorities would penalyze if there is any delay.

Spanish-inheritance-tax 

 

WILLS & IN SPAIN:

Spanish inheritance laws restrict testators from disposing of their estate to a person of their choice that is not a direct heir. As a result, this may vary to the laws in your country of origin. However, the purpose of this law is to protect the heirs. Therefore, as a non-Spanish national you can make a Spanish will bequeathing assets as you desire under the law of their own country. 

Consequently, your foreign will is valid in Spanish inheritance cases. Therefore, we highly recommend you to have a Spanish will just for your Spanish assets. Moreover, you can avoid complications when dealing with inheritance tax in Spain.

As a result, when making a Spanish will you must ensure that your foreign will excludes Spain. So make sure that any subsequent will you make in another country does not supersede the testementary dispositions under your Spanish will. 

CALCULATING SPANISH INHERITANCE TAX.

Inheritance tax in Spain is chargeable to the spouse, children or any other party who receives any part of the deceased’s estate in Spain. However, there is a tax-free allowance of € 15.956,87 when left to spouse and children, € 7.993,46 for brother/ sisters, nephews/ nieces, aunts/ uncles. There is no tax-free allowance for relatives in forth degree or friends.

So, once the allowance has been deducted the tax rate applicable is then charged on a sliding scale, (see Spanish Inheritance Tax table). As a result, the value of the property you need to declare will be the minimum value of the property accepted by the Spanish Tax Office (valor fiscal). 

LOWERING YOUR TAX LIABILITY

It is important to take steps to lower your Spanish inheritance tax liability, where possible, so here are some points to note:

  • BUY JOINTLY WITH FUTURE INHERITORS, THUS LIMITING LIABILITY
  • SELL THE PROPERTY TO FUTURE INHERITORS EITHER FULLY OR PARTLY.
  • TAKE OUT A MORTGAGE LOAN ON THE PROPERTY.
  • ORGANISING LIFE INSURANCE THUS ENSURING ADEQUATE FUNDS TO COVER THE SPANISH INHERITANCE TAX BILL.

We can help you with all your Spanish inheritance tax issues. So call us now and speak directly to a lawyer on (+34) 952 906 185. Similarly, we can help you with other legal issues in Spain. What’s more, with we over 20 years experience we can guarantee a first rate service.

Amount of InheritanceSpanish inheritance tax rate to expect as a result(%)
0 up to  7,993.46€7.65% inheritance tax  in Spain
Up to 15,980.91€8.50% inheritance tax in Spain
Up to 23,968.36€9.35% inheritance tax in Spain
Up to 31,955.81€10.20% inheritance tax in Spain
Up to 39,943.26€11.05% inheritance tax in Spain
Up to 47,930.72€11.90% inheritance tax in Spain
Up to 55,918.17€12.75% inheritance tax in Spain
Up to 63,905.62€13.60% inheritance tax in Spain
Up to 71,893.07€14.45% inheritance tax in Spain
Up to 79,880.52€15.30% inheritance tax in Spain
Up to 119,757.67€16.15% inheritance tax in Spain
Up to 159,634.83€18.70% inheritance tax in Spain
Up to 239,389.13€21.25% inheritance tax in Spain
Up to 397,555.08€25.50% inheritance tax in Spain
Up to 797,555.08€29.75% inheritance tax in Spain
Over 797,555.08€34.00% inheritance tax in Spain

If you want help regarding Inheritance tax in Spain, then call us now on (+34) 952 906 185. Similarly, we can help you with other legal issues in Spain. What’s more, with we over 20 years experience we can guarantee a first rate service.