Inheritance Law in Spain: A Quick Guide

Inheritance law in Spain is governed by a combination of national and regional regulations, and it differs significantly from laws in countries like the UK or United States. For non-residents or individuals with assets in Spain, understanding these rules is crucial to avoid unexpected legal challenges.

Inheritance in Spain is subject to a combination of national and regional legal frameworks, with a central tenet being «legítima» or forced heirship. This doctrine mandates that a designated portion of the decedent’s estate is reserved for descendants or other compulsory heirs.

Inheritance tax («Impuesto sobre Sucesiones y Donaciones») is calculated based on the heir’s relationship to the deceased, and must be settled within a statutory period of six months from the date of death. It is prudent for foreign nationals to engage legal counsel proficient in both Spanish and their home country’s legal systems to ensure compliance and efficient estate management.

1. The Importance of a Spanish Will

While it is not mandatory to have a Spanish will, it is highly advisable if you own property or assets in Spain. A Spanish will simplifies the inheritance process for your beneficiaries, particularly if they are non-residents. It ensures that your wishes are respected, and helps avoid the more complicated process of relying on a foreign will, which would require translation and validation in Spain.

2. Forced Heirship

Spain has a unique system called «forced heirship» that mandates a portion of the deceased’s estate must go to certain relatives. For example, one-third of the estate, known as the «legítima,» must go to the deceased’s children. Another third, the «mejora,» is also reserved for the children or grandchildren, though the testator has more flexibility in distributing this part. The final third can be freely allocated according to the testator’s wishes. This differs from common law systems like the UK, where a person can freely distribute their entire estate.

So according to Spanish law:

• First 1/3 («Legítima estricta»):
  • Must be equally distributed among all children (biological or adopted).
  • No discretion allowed in its allocation.
• Second 1/3 («Mejora»):
  • Allocated to the children, but the testator can vary the proportions (unequal distribution is permitted).
  • The surviving spouse has a life interest (usufruct) over this portion.
  • Full ownership transfers to the children upon the spouse’s death.
• Final 1/3 («Tercio de libre disposición»):
  • Freely distributable to any beneficiaries as determined by the testator.
  • No legal restrictions on its allocation.

For foreign residents in Spain, you can choose to have the inheritance law of your nationality apply to your estate, allowing more freedom to distribute your assets. However, this needs to be explicitly stated in a Spanish will.

3. What Happens Without a Will?

If someone dies without a will (intestate), Spanish law dictates the order of succession. The estate will be distributed first to children and descendants. If there are no descendants, it will go to parents and ascendants, and then to the spouse. If there are no close relatives, the estate can pass to more distant family members, and as a last resort, to the state.

4. Inheritance Tax

Spain imposes inheritance tax on beneficiaries, not the estate itself, and the rate varies depending on the relationship to the deceased. Direct family members (children, parents and spouses) benefit from significant tax reductions. Regional governments also have authority to adjust tax rates and allowances, so the amount payable can vary depending on where the assets are located.

For non-residents, Spanish inheritance tax only applies to assets within Spain. However, your home country may also tax your inheritance, so it is essential to check for any double taxation agreements between Spain and your home country.

5. Inheritance Process

The inheritance process in Spain involves several steps:

• Death certificate and will registry check: The first step is obtaining the death certificate and checking with the Central Will Registry to determine whether a Spanish will exists.
• Acceptance of inheritance: The heirs must formally accept the inheritance through a legal process, often involving a notary. This step is crucial, as it confirms the transfer of ownership of assets.
• Payment of inheritance tax: Inheritance tax must be declared and paid within six months of the date of death. Extensions can be requested if needed, but delays may incur penalties.