Contact in Spain
Spain: +34 932 20 44 40
UK: 0800 098 8033
US: +1 415 651 8449

Inheritance Tax Rates in Spain

 

National vs Regional Tax Rules

Formerly, only those who have been ordinarily resident in a particular region of Spain over the balance of a period of five years prior to their death will have the more generous regional inheritance tax exemptions applied to their estate.

In addition it will require the beneficiary to be resident in some part of Spain.

If not, the national rules applied. What this meant of course was that, more often than not, the rules for most non-Spanish beneficiaries were calculated using the less generous ‘national level’ deductions.

However, following a judgment by the European Court, the Spanish government has passed into law Ley 26/2014 about inheritance tax rates in Spain, which came into force on January 1st, 2015.

The new legislation provides that European Union citizens, ordinarily resident in another European country, may apply any deductions available to residents of the region in Spain in which their assets are located. Please view the regional tax deductions.

For non-EU citizens, the less generous ‘national level’ tax exemptions below apply.

Tax Exemptions

The exemptions available at a national level may be summarised as follows:

 

Personal Exemptions

Inheritance tax rates in Spain - Personal exemptions

Inheritance tax rates in Spain – Personal exemptions


Guide to Groups

In Spain a beneficiary is assigned a category or Group depending on their relationship with the deceased, as per the following table:

Group I            Children, including adopted children, under the age of 21

Group II           All other children, spouses and parents

Group III         Close relatives such as brothers and sisters, grandparents, aunts/uncles

Group IV         More distant relatives

 

Disabilities

In addition to the above exemptions, should any beneficiary be disabled, further exemptions ranging between €47,858.59 and €150,253.03 depending on the level of disability.

 

Life Insurance Policies

If the deceased took out a life insurance policy in favour of a beneficiary there is an exemption up to the value of €9,159.49 where the beneficiary is a spouse, child or parent.

 

Inheritance of the Family Home

An exemption also exists for tax payable on the permanent or habitual residence. The definition of habitual residence is the same as that used in Spanish Income Tax legislation and presupposes time having been spent living in the property.

The classification of a property as the family home will be assisted through the presentation of supporting evidence such as tax returns with the property listed as the habitual address of the taxpayer.

This exemption applies equally to a spouse, children and parents of the deceased at a rate of 95% of the value of their inherited portion of the property up to a maximum value of €122,606.47 each. An important proviso exists in that the property may not be sold for a period of 10 years after the inheritance.

Other relatives further removed, may also benefit from this exemption but must have been living with the deceased in the property for a period of at least two years prior to the date of death.

Tax Rates

Inheritance tax rates in Spain - Taxrates

Inheritance tax rates in Spain – Taxrates

To demonstrate how the tax rates are applied, consider the following example:As stated earlier, the relevant factors when calculating the tax liability that a beneficiary of an estate in Spain will face include tax exemptions, the tax rate and their personal wealth.

Example

Where three children each inherit, after exemptions and charges, an inheritance valued at €45,000 from a parent, to determine the amount of tax payable by each we would calculate as follows:

Up to €39,943.26 the tax payable is €3,734.59

The portion above €39,943.26 (€45,000 – €39,943.26 = €5,056.74) is taxable at 11.9% = €601.75

So, total tax payable by each child is € 3734.59 + € 601.75 = €4,336.34

 

Personal Wealth

Inheritance tax rates in Spain - Personal wealth

Inheritance tax rates in Spain – Personal wealth

Example

A brother of the deceased inherits an estate comprised of cash of approximately €68,000 generating a net tax liability of €6,000 (after exemptions, deductible charges gave been deducted and tax rate applied). The beneficiary has a pre-existing wealth of €450,000.

Then the total tax payable increases to 6,000 x 1.6676 = €10,002 (As a brother of the deceased the correct category is Group III).

You may be interested in the following service...

Client testimonials

"I would like to thank our lawyer very much for all his expertise. He was brilliant in every aspect. Nothing too much trouble. Very professional and would definitely recommend him to anyone in the future. Regards Gail Maher"

Gail Maher (Oct 21, 2020)

Inheritance

Available in the following locations: Alicante, Arrecife, Barcelona, Benidorm, Cadiz, Castellon, Córdoba, El Campello, Estepona, Fuengirola, Gandia, Girona, Granada, Jaen, L`Eliana, La Manga del Mar Menor, Las Palmas, Los Alcázares, Los Cristianos, Madrid, Malaga, Marbella, Maspalomas, Mazarron, Murcia, Nerja, Orihuela Costa, Oviedo, Palma de Mallorca, Puerto del Rosario, Puzol, Seville, Torrevieja, Valencia, Velez Malaga, Vigo, Zaragoza.

* If your local town is not listed, a lawyer from our nearest office will be happy to assist you.

Location

1Who is this Service for?

For those who need to arrange for an estate abroad to be transferred to beneficiaries under a Will or via intestacy

2What does this service consist of?

  • Assistance obtaining a legalised copy of the death certificate.
  • Arrange a legal copy of any existing will.
  • Verification of the existence of any life insurance policies.
  • Power of Attorney to avoid excessive travel costs
  • Inheritance Acceptance Deed drawn-up with the public notary.
  • Payment of Inheritance Tax at the office.
  • New titles in the inherited assets are inscribed in the relevant registry
  • Simultaneous sale or disposal of assets if required (please request quotation).

 

Support services

3Free Support Services Included

When combined with the free and innovative Advocate Abroad support services you can be sure that you are obtaining completely transparent legal services from registered and regulated English-speaking lawyers abroad.These support services include:

  • Verification of the regulatory status of your professional.
  • Fees as recommended by the Local Professional Body
  • Fees specified in advance and legally guaranteed.
  • Service levels agreed in advance and guaranteed.
  • All professionals must hold professional indemnity insurance.
  • Professionals' proficiency in English monitored.
  • Continuous quality controls and reviews.

Why choose Advocate Abroad?

AdvocateAbroad.com Message
Established more than
10 years ago
Present in 20
European Countries
Over 30,000 client enquiries
successfully managed