10 IMPORTANT INHERITANCE ISSUES10 IMPORTANT INHERITANCE ISSUES TO TAKE INTO ACCOUNT IF YOU ARE AN EXPAT IN SPAIN
These are 10 important things you should know if you are an expat living in Andalusia
- If you live in Andalucia for more than 183 days a year, you should be a tax resident in Spain
- The residence of the deceased person and the beneficiary are key points which decide where the inheritance taxes should be submitted i.e. at the Andalucia Tax office (in case of residents in Andalucia) or at the Spanish Inland Revenue in Madrid (in case of being non-residents).
- The inheritance laws to be applied to an inheritance (regarding the distribution and disposition of assets) will be the ones of the nationality of the deceased person. i.e. if you are British, the British laws will apply to your inheritance.
- If you have assets in Spain (i.e. real estate property, funds in bank accounts, shares, vehicles, etc) it is recommendable to make a Spanish will only for the distribution of the Spanish assets. It will make things easier, cheaper and quicker for your relatives when anything happens to you.
- The signed Spanish will will be 100 % respected if it complies with the national laws. It is important to seek advice when drafting your will.
- If you receive an inheritance, and are a tax resident in Spain, the inheritance taxes, (if any), should be paid in Spain, even if the assets inherited are situated outside of Spain.
- In Andalucia, when the inheritance transfer takes place between direct relatives (spouses and children) there are allowances of up to 1,000,000€ per heir. This is applicable to Andalusian residents and Europeans. Therefore, in most cases there is no inheritance tax to be paid.
- The tax return for an inheritance must be filed within 6 months from the date of the death.
- Transmission of ownership of the assets of the deceased person is not automatic and it is also compulsory to carry out some complicated Legal and tax paperwork, (e.g.: – get certificate of last will, sign the inheritance deeds in front of a public notary, file the inheritance tax returns, etc), in order to acquire ownership of the inheritance. It is highly recommended that you seek advice and professional assistance from a solicitor.
- When receiving an Inheritance in Spain, it is not only the estate of the deceased person that is inherited, but also their debts. Therefore, this matter should be checked out before accepting an inheritance so that it does not turn into a nightmare. The debts could be higher than the assets!!