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Wills for Ex-Pats in Spain

Wills for Ex-Pats in Spain

Old Jul 15th 2011, 10:00 pm
  #31  
 
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Default Re: Wills for Ex-Pats in Spain

Originally Posted by Rostra
Don't forget that if you don't declare a Spanish inheritance for 5 years (actually 4 1/2 + a bit) it becomes exempt from inheritance tax.
True, but if they can prove that you fraudulently did not declare it then it may still be liable and penalties added. Not a chance some people would choose to take.
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Old Jul 15th 2011, 10:16 pm
  #32  
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Default Re: Wills for Ex-Pats in Spain

Originally Posted by Fred James
True, but if they can prove that you fraudulently did not declare it then it may still be liable and penalties added. Not a chance some people would choose to take.
Never had a problem with that one (she says, touching wood!) and always use it if they don't want to sell the property immediately.

The Spanish here always do this. It was the self same Notary friend who said so!

Just shows - you pays your money and takes your choice.
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Old Jul 15th 2011, 10:18 pm
  #33  
 
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Default Re: Wills for Ex-Pats in Spain

Originally Posted by Rostra
Spot on, Fred, except it is only children who can contest. The spouse has no inheritance rights. But the test case apparently clarified this, and made Spanish law dominant.
To add to this, surely, although the spouse has no inheritance rights he/she has usufruct rights to remain in the house?

As for the "test case" are you referring to the 2004 Supreme Court case? If so the case there was of someone whose Spanish will was contested but he had no UK assets at all. If he had, then UK law would have applied. Apparently it's a complicated legal situation called a "Double Renvoi" - sounds complicated to me!
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Old Jul 15th 2011, 10:21 pm
  #34  
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Default Re: Wills for Ex-Pats in Spain

Originally Posted by JLFS
Then wording on wifes will says:

Nombra e instituye Heredero Universal de todos sus bienes, derechos y acciones presentes y futurs, a su citado esposo JLFS (me).

We both wanted to leave the entire amount of our assets to each other, but I cannot, my wife can because she comes under British law, which contradicts what is being said in this thread, our wills are dated May this year 2011.
Interesting LJ - Yours is more or less as I would have expected .
Did you leave a third of it to your wife? The rule is: One third equally between children, one third to one or more of the children (this allows for example for you to leave more to a disabled child, in theory) and the last third is for your free disposition.

Why was your wife's will different. Is she not resident?
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Old Jul 15th 2011, 10:40 pm
  #35  
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Default Re: Wills for Ex-Pats in Spain

Originally Posted by Fred James
To add to this, surely, although the spouse has no inheritance rights he/she has usufruct rights to remain in the house?

As for the "test case" are you referring to the 2004 Supreme Court case? If so the case there was of someone whose Spanish will was contested but he had no UK assets at all. If he had, then UK law would have applied. Apparently it's a complicated legal situation called a "Double Renvoi" - sounds complicated to me!
The "Double Renvoi" just means that the two laws apparently contradict each other (as to which law takes precedence) as you mentioned above.

The subject of the case was American. The principle established was that Spanish Law takes precedence over property in Spain, whatever the nationality/fiscal situation of the testator, IF HE/SHE IS RESIDENT IN SPAIN. If you have assets in the UK you are free to do what you like with them, but if you get a grant of Probate in the UK they will (mostly) insist on including the Spansh property and charge IHT on it. The only way then to escape two lots of IHT which is NOT covered by the DTA is to not declare the Spanish Will for 5 years.

It is a bit of a nightmare!

I never looked up the case, my Notary friend did that for me. 2004 sounds about right, though it had been going on for years. I was first told about it by a friend who worked for (oops, can't remember - big tax consultancy in Gibralter). He lived on the Costa and followed it closely. From memory it took about 8 years to reach a decision, but the Testator was very wealthy so it was worth the children's efforts to fight for their inheritance.
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Old Jul 15th 2011, 10:43 pm
  #36  
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Default Re: Wills for Ex-Pats in Spain

[QUOTE=Fred James;9498893]To add to this, surely, although the spouse has no inheritance rights he/she has usufruct rights to remain in the house?

QUOTE]

No, the spouse does not automatically get Usufructo. However if the will has been sensibly made using the third share for free disposition to leave ithat portion to the spouse, and the property was originally in joint names,then he/she owns 2/3rds of the property outright. He/she can then decide freely whether to stay or go, but if the property is sold he/she only gets 2/3rd of the money.
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Old Jul 16th 2011, 2:10 am
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Default Re: Wills for Ex-Pats in Spain

Originally Posted by Rostra
Interesting LJ - Yours is more or less as I would have expected .
Did you leave a third of it to your wife? The rule is: One third equally between children, one third to one or more of the children (this allows for example for you to leave more to a disabled child, in theory) and the last third is for your free disposition.

Why was your wife's will different. Is she not resident?
Hi Rosta,

I am Spanish and my wife is British,

I have left la legitima to the kids (by law) and the rest to the missus.

She has left the whole lot to me, as she does not have to leave anything to them.

It is not that we hate our kids or anything like that it is just that as the assets are the result of our work and planning during our marriage together, we are both of the opinion that it should be for us to enjoy while still here, and then kids will get theirs when we are BOTH gone.

But your posts seem to say that we have not got things nailed down as tight as we think.

BTW we are both residents, with property here and UK
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Old Jul 16th 2011, 2:18 am
  #38  
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Default Re: Wills for Ex-Pats in Spain

Originally Posted by JLFS
Hi Rosta,

I am Spanish and my wife is British,

I have left la legitima to the kids (by law) and the rest to the missus.

She has left the whole lot to me, as she does not have to leave anything to them.

It is not that we hate our kids or anything like that it is just that as the assets are the result of our work and planning during our marriage together, we are both of the opinion that it should be for us to enjoy while still here, and then kids will get theirs when we are BOTH gone.

But your posts seem to say that we have not got things nailed down as tight as we think.

BTW we are both residents, with property here and UK
JL - your case is clear since you are Spanish. It's your wife's that worries me. I believe that if she used your UK address when making her will she might get away with using UK law, but don't forget the UK inheritance tax situation (they will try to include Spanish property for inheritance tax.)

It is a nightmare!

As you are likely to go first (sorry - but you're a bloke and we usually outlast you) make sure she knows about the 5 year rule.

I can't tell you how many arguments (sorry - animated discussions) I have had with UK Probate offices about all this. It is REALLY muddy water.

Don't forget too that you can make a part declaration of a Spanish will (which deals with things like transferring the car into the name of the survivor)
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Old Jul 16th 2011, 2:26 am
  #39  
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Default Re: Wills for Ex-Pats in Spain

Originally Posted by Rostra
JL - your case is clear since you are Spanish. It's your wife's that worries me. I believe that if she used your UK address when making her will she might get away with using UK law, but don't forget the UK inheritance tax situation (they will try to include Spanish property for inheritance tax.)

It is a nightmare!

As you are likely to go first (sorry - but you're a bloke and we usually outlast you) make sure she knows about the 5 year rule.

I can't tell you how many arguments (sorry - animated discussions) I have had with UK Probate offices about all this. It is REALLY muddy water.

Don't forget too that you can make a part declaration of a Spanish will (which deals with things like transferring the car into the name of the survivor)
hhmmmmmmmmmm.

We might have to rip it up and start again.

But in July and August it is too hot to be getting steamed up and doing verbal gymnastics in the gestors office.

Cheers
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Old Jul 16th 2011, 2:34 am
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Default Re: Wills for Ex-Pats in Spain

Originally Posted by Rostra
JL - your case is clear since you are Spanish. It's your wife's that worries me. I believe that if she used your UK address when making her will she might get away with using UK law, but don't forget the UK inheritance tax situation (they will try to include Spanish property for inheritance tax.)

It is a nightmare!

As you are likely to go first (sorry - but you're a bloke and we usually outlast you) make sure she knows about the 5 year rule.

I can't tell you how many arguments (sorry - animated discussions) I have had with UK Probate offices about all this. It is REALLY muddy water.

Don't forget too that you can make a part declaration of a Spanish will (which deals with things like transferring the car into the name of the survivor)
You could be wrong about me going first, on of the kids might want to hurry things along at some stage in the future.

If so it would be better to bump off the wife, if they sit and work out the sums, if I go first they get a third, then the missus cops for the rest and does not have to leave them anything.

if the missus goes first she leave me the lot, and then the kids get a third of the total of mine and hers together.

So I think she is the one that needs to stay away from high cliffs.
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Old Jul 16th 2011, 2:43 am
  #41  
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Default Re: Wills for Ex-Pats in Spain

Originally Posted by JLFS
You could be wrong about me going first, on of the kids might want to hurry things along at some stage in the future.

If so it would be better to bump off the wife, if they sit and work out the sums, if I go first they get a third, then the missus cops for the rest and does not have to leave them anything.

if the missus goes first she leave me the lot, and then the kids get a third of the total of mine and hers together.

So I think she is the one that needs to stay away from high cliffs.
So when she goes, you sell up and spend the lot!
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Old Jul 28th 2011, 9:03 pm
  #42  
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Default Re: Wills for Ex-Pats in Spain

Originally Posted by Rostra
So when she goes, you sell up and spend the lot!
We have read all your comments and Wow!!!!! It looks like I opened a complicated 'can of worms'

We are in the process of moving to a retirement park home in Spain - but are seriously reconsidering it. Our total assets would not even come close to IHT in the UK, but we are well into retirement and don't want any financial hassle for each other when one of us dies in Spain.

Thank you so much for taking the time to comment for us.
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Old Jul 28th 2011, 9:38 pm
  #43  
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Default Re: Wills for Ex-Pats in Spain

Originally Posted by Fred James
True, but if they can prove that you fraudulently did not declare it then it may still be liable and penalties added. Not a chance some people would choose to take.
Agree. We've been advised formally (and told informally by many people) that the 5 year loophole worked in the past but that these days it would be difficult to achieve and that the penalties would be steep. As you say, in most cases it would be fraudulent (and probably not difficult to prove as the surviving spouse at some point would probably have to fraudulently submit paperwork (eg annual tax return, albeit it a nil one) on "behalf" of the deceased.
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Old Jul 29th 2011, 5:04 am
  #44  
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Default Re: Wills for Ex-Pats in Spain

I was told that a woman had died and the Spanish Goverment took her house because she did not leave a will and her son came over from UK and couldnt do anything about it.. true or false..
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Old Jul 29th 2011, 5:41 am
  #45  
 
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Default Re: Wills for Ex-Pats in Spain

False. If she didn't leave a will the children get it.

If you don't have any relatives at all then yes it goes to the state.
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