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Spanish inheritance law

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Spanish inheritance laws

Inheritance Issues

Jose María Sánchez Alfonso managing director of Andalusian Lawyers is going to talk about wills and inheritance in Spain.

Peter: One of the first questions many listeners have, is it is necessary to have a Spanish will if you own a property in Spain?

JM: Well, it isn’t a legal obligation but it is highly recommended and I always advise my clients to make a Spanish will as soon as possible after buying a property.

P: So, why is it a good idea to make a Spanish will?

JM: The main advantage of having a Spanish will is that the inheritance process in Spain is much quicker because you don’t have to translate and legalise a will made in the UK. This also means that it is cheaper if you have a Spanish will.

P: OK, so I decide to make a Spanish will. Do I have to follow Spanish law regarding who I can leave my assets to?

JM: It’s important for your listeners to know that in Spain a foreigner can make a will according to the rules in their home country. So, for example, as the law in the UK states that individuals may dispose of their worldly goods as they wish, this means that they can do the same with their assets in Spain.

P: So, I’m not obliged to leave a certain amount to my children or spouse?

JM: No, you can leave your assets to whoever you like in whatever proportion.

P: Can you guide us through the process of making a will and give an idea of costs?

JM: First of all, you decide the will’s contents together with your lawyer. Your lawyer will have the will drawn up in Spanish and also translated into English – this is a legal requirement. Then you sign the will in the presence of a notary public. The usual cost for making a will is about €50 for notary fees and €150 for the lawyer’s fees.

P: And do I get a copy of the original will afterwards?

JM: No, the original is kept in the notary’s files to be used during the future inheritance process. You get a copy and it’s a good idea for your lawyer to keep a copy as well. It’s also advisable to make sure your immediate family has your lawyer’s contact details.

P: Does Spain still levy inheritance tax?

JM: Yes, but the amount varies from region to region as inheritance tax is regulated by regional governments, not the central government. Most regions have reduced inheritance tax quite significantly, some have abolished it and the majority have introduced substantial reductions in the amount that has to be paid.

P: Could you give an example of this?

JM: In Andalusia (Costa del Sol, Costa de la Luz, Granada and Almería), residents are exempt from inheritance tax on a property if it was their home that they shared with the deceased. For example, a spouse or children don’t pay tax on the family home. However, there are certain conditions: for example, you have to keep the property as your principal home for 10 years after inheriting it and to qualify as a resident, you must have lived in the property during at least 3 years beforehand.

P: What do you think the chances are of inheritance tax being abolished or drastically reduced in the future?

JM: The general tendency is for inheritance tax to be reduced and I think it will eventually be abolished in many regions.

P: What recommendations would you make so that our listeners can reduce future inheritance tax?

JM: Well, this is a very complicated issue and depends very much on the individual case so I would recommend that they discuss their particular situation with their lawyer before making a will and also before signing the title deeds for a property, in some cases. But as a general idea, there are several things you can do to reduce future taxes for your heirs – being a resident helps because most reductions apply to residents only. Register with your town hall as soon as possible.

P: Can you avoid inheritance tax by putting the property into your children’s names?

JM: Yes, this is another way round inheritance tax – your children (or your heirs) are legal owners of the property and you have exclusive life interest in the property. But as I said before, this depends on each individual case and you must discuss the implications of this with your lawyer before making a decision.

P: How much inheritance tax would you pay on a property in Andalusia?

JM: Again, each case is different but as a rough idea, on a 2-bedroom apartment with a fiscal value of between €80,000 and €100,000 you would pay between 16 and 21% in tax. Your listeners will be relieved to know that you don’t use market values when calculating an inheritance.

P: Thank you very much, José.

Andalusian Lawyers can be contacted on their website at: www.andalusianlawyers.com

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