SMarks

I have recently inherited property in alicante and I have been told today by a spanish lawyer that I have to pay inheritance tax as I am not resident here, can anyone help with some advice about this?

lynnxa

yes, you do have to pay inheritance tax on any property in Spain, whether you live here or not - although there are variations in amount in different regions

also, if you were resident in Spain you would have to pay the tax on anything you inherited from anywhere in the world - so they get you every which way!!

essentially, it's the inheritor who pays the tax, not the deceased's estate

missile

You are liable for inheritance tax in relation to the value of the property.
Your solicitor should have told you how much?

Domino

ISTR Spanish HMRC will want the money almost immediately whilst UK HMRC are more lenient. You will have to pay the tax even if you cannot sell the property.

So a well meaning gift in a will can prove to be a financial nightmare, which is why some Spanish solicitors, including mine in the UK, are now suggesting it is better to rent a property rather than buy.

Fred James

It's not a question of leniency - there is no such word in the HMRC dictionary!

In the UK the tax is paid by the estate before anyone gets their hands on the money. You eventually get a cheque in the post whereas in Spain you get a tax demand!

Incidentally, the amount of tax you pay is based on the value of the assets you inherit but crucially it also depends on your relationship with the deceased. Unless you are a spouse or child the tax can be much higher. In the case of a non relative the rate is doubled.

spainrico

Yes you will have tax liabilities - the actual amount depends on several factors including your relationship to the deceased (the more distant the higher the tax) valuation of the property and non residents currently also pay a higher rate (although that is supposed to be under review) You will also need a Spanish tax number (NIE) and you cannot take title to the property until the tax is paid (so you cannot sell it and then pay the tax)
I suggest you get good professional advice to ensure you pay the correct amount and then take full legal title.

snikpoh

You might also have to pay tax on the inheritance in UK - check it out first.

SMarks

Thank you so much for your replies, it was a bit of a shock to hear that when you loose a parent and they leave you a gift, you then have to pay tax on it, but I will pay the taxes due with my sister.

I have found an inheritance tax reclaim service so I will be able to get almost all the money back in due course. I might be back with more questions later.

Rosemary

As Concierge for the Spanish section of BE I would like to say hello and welcome.

BE is a very large expat website, so if you have problems finding your way around we have concierges who will try to direct you. The moderators for the Spanish forums are Mitzyboy and Fred James, moderators are there to ensure that the site runs smoothly within the rules of BE. Problems and complaints should always be addressed to a moderador who will look into the matter and deal with it efficiently and fairly. Our members who post in the Spain Forums are friendly and helpful with a wealth of knowledge of the issues of living in Spain. At the top of the page you will find a quirkily named thread called Free Beer which is full of important and useful information. Hope you enjoy your time participating in the forums.

Please let me know if you need any further help.

Rosemary

Lynn R

An "inheritance tax reclaim service" sounds a bit suspect to me. There is a set formula which stipulates how much tax is payable, based on the official value of the estate and the degree of relationship between the deceased and the beneficiary. If the beneficiary is not a Spanish resident, no allowances can be claimed to offset against the tax liability. Therefore I find it very difficult to understand how any tax could be reclaimed at a later date. If these people are charging a fee, I would be very careful.

snikpoh

Great minds .... just what I was going to write.


The only service they might offer is that if you have paid succession tax here and have then to pay IHT in UK, then they might be able to offset some of the one tax against the other.

That is, you may not have to pay all the IHT AND all of the succession tax.

SMarks

hello, The company I spoke with, can I say there name here? . but they said to get back to them once the taxes had been paid and they will help me recover the money back. it is on a no win no fee basis so I thought it would be worth a go to get my money back.

jackytoo

You cannot claim back inheritance tax...and no you cannot mention names on here or we may think you are advertising

whitelinen

ooops you beat me to it

SMarks

I came to the forums for some honest advice regarding inheritance tax and I thank you good people for that.
After the nice replies I got back I thought I would return the favour with the information I received from a spanish lawyer that as a non-resident you can recover spanish inheritance tax.