Inheritance tax
Feb 14th 2012 | 8:07 pm
#46
MEL & JOHN
Joined: Dec 2005
Posts: 720
Re: Inheritance tax
Essentially the rules are the same - if one party dies then only half of the value of the property is liable to tax. Whoever inherits the deceased's share pays the tax. There are no exemptions for transfers between spouses (as there are in the UK).
Where it gets complicated in the case of siblings is that unless they are living together in the house and it is their habitual residence most of the special allowances do not apply. Also the tax increases by over 50% as siblings are not considered close relatives (spouses and children are).
It's a very complicated subject, the rules are different in each region and they are changing all the time. If it is a real concern for you then you should seek local professional advice.
Where it gets complicated in the case of siblings is that unless they are living together in the house and it is their habitual residence most of the special allowances do not apply. Also the tax increases by over 50% as siblings are not considered close relatives (spouses and children are).
It's a very complicated subject, the rules are different in each region and they are changing all the time. If it is a real concern for you then you should seek local professional advice.
Please could you tell me if grandchildren are considered close relatives for the purposes of Spanish IHT ?
Many thanks Mel
Feb 14th 2012 | 10:35 pm
#48
MEL & JOHN
Joined: Dec 2005
Posts: 720
Re: Inheritance tax
Thank you Fred, reply much appreciated
All the best Mel
All the best Mel
Feb 14th 2012 | 10:40 pm
#49
Moderator
Joined: Mar 2007
Posts: 15,149
From: Costa Valencia
Re: Inheritance tax
Rosemary
Feb 14th 2012 | 10:48 pm
#50
MEL & JOHN
Joined: Dec 2005
Posts: 720
Re: Inheritance tax
Thanks for your reply Rosemary, I have to look into this and get advice but had just read that under 21's are not liable for Spanish IHT. I am sure it is not that straight forward but want to consider all options. Our will leaves the house to our 2 adult children BUT I would hate for us to turn our toes up and they be left with a large IHT bill and a property that, in these difficult economic climes, they would be unable to sell but have to maintain/ foot the expenses bill for.
Mel
Mel
Feb 14th 2012 | 11:36 pm
#51
Lost in BE Cyberspace
Joined: Feb 2008
Posts: 6,172
Re: Inheritance tax
Thanks for your reply Rosemary, I have to look into this and get advice but had just read that under 21's are not liable for Spanish IHT. I am sure it is not that straight forward but want to consider all options. Our will leaves the house to our 2 adult children BUT I would hate for us to turn our toes up and they be left with a large IHT bill and a property that, in these difficult economic climes, they would be unable to sell but have to maintain/ foot the expenses bill for.
Mel
Mel
Feb 15th 2012 | 1:02 am
#52
Senior Moment
Joined: Jan 2006
Posts: 20,459
From: On the edge
Re: Inheritance tax
I had to just go in and have an error amended on the wifes will.
We (each) have wife / husband > daughter > my sister
and thats all
We (each) have wife / husband > daughter > my sister
and thats all
Feb 15th 2012 | 2:06 am
#53
BE Forum Addict
Joined: Apr 2010
Posts: 2,143
From: London (mainly)/Oliva
Re: Inheritance tax
I don't know if this point has been raised but as I understand it, there is no significant grace period for payment of inheritance tax.
Does anyone have experience of this?
If that is correct it may affect how I deal with my Spanish property. ie sell it while still alive.
Does anyone have experience of this?
If that is correct it may affect how I deal with my Spanish property. ie sell it while still alive.
Feb 15th 2012 | 2:11 am
#54
Retired and loving it!
Joined: Sep 2007
Posts: 5,211
From: Ontinyent - Valencia region (campo)
Re: Inheritance tax
I don't know if this point has been raised but as I understand it, there is no significant grace period for payment of inheritance tax.
Does anyone have experience of this?
If that is correct it may affect how I deal with my Spanish property. ie sell it while still alive.
Does anyone have experience of this?
If that is correct it may affect how I deal with my Spanish property. ie sell it while still alive.
Feb 15th 2012 | 2:15 am
#55
BE Forum Addict
Joined: Jul 2006
Posts: 1,389
From: up the mountain near Guadalest
Re: Inheritance tax
Inheritance tax is payable within six months of the date of death otherwise interest is charged.
Feb 15th 2012 | 2:21 am
#56
Joined: Jun 2006
Posts: 11,231
From: Granada Costa
Re: Inheritance tax
I think you can extend it for 6 months so long as you apply before the 6 months is up. Interest will be due for the extra time.
Feb 15th 2012 | 2:22 am
#57
BE Forum Addict
Joined: Apr 2010
Posts: 2,143
From: London (mainly)/Oliva
Feb 15th 2012 | 2:33 am
#58
Joined: Jun 2006
Posts: 11,231
From: Granada Costa
Re: Inheritance tax
They get the basic allowance of €16k plus €4k for every year under 21 up to a maximum total allowance of €48k.
Feb 15th 2012 | 2:50 am
#59
MEL & JOHN
Joined: Dec 2005
Posts: 720
Re: Inheritance tax
Thanks Fred, yep spotted that during my "googling"
SO, is is best to will the house to our 2 adult children and grandaughter to reduce the liability as each would have their own allowance, what about adding a daughter-in -law ? Just thinking out loud
I am presuming that non-residents do have the tax allowances OR are they only for residents ?
Any thoughts that anybody has would be welcome, maybe together we can work out the best way to reduce Spanish IHT, having said that our circumstances will all be different.
SO, is is best to will the house to our 2 adult children and grandaughter to reduce the liability as each would have their own allowance, what about adding a daughter-in -law ? Just thinking out loud
I am presuming that non-residents do have the tax allowances OR are they only for residents ?
Any thoughts that anybody has would be welcome, maybe together we can work out the best way to reduce Spanish IHT, having said that our circumstances will all be different.
Feb 15th 2012 | 3:06 am
#60
Joined: Jun 2006
Posts: 11,231
From: Granada Costa
Re: Inheritance tax
The basic allowances apply to non residents. It's the special allowances for the "habitual residence" and some of the additional regional variations that only apply to residents.
