If you have inherited property in Spain, the first question is often a practical one: what do I need to do now? For a foreign heir, inheriting a Spanish property may involve succession law, Spanish taxation, notarial documentation and registration of the inherited property.
The fact that the property is located in Spain does not necessarily mean that Spanish succession law governs the inheritance. However, the existence of Spanish real estate will normally require certain legal and tax formalities to be completed in Spain before the inherited ownership can be properly registered and subsequently sold or otherwise dealt with.
The correct procedure will depend on factors including the deceased’s habitual residence and nationality, the contents of any will, the residence of the heirs, the location of the estate and the law applicable to the succession.
For a broader overview of the legal and tax framework applicable, you can read my general guide to international inheritance in Spain: Inheritance in Spain for Foreigners: What You Need to Know.
Key Takeaways
- Owning a property in Spain does not necessarily mean that Spanish succession law governs the inheritance.
- In international successions, the applicable law must first be determined under the relevant private international law rules.
- Spanish Inheritance Tax may be payable even where the heir and the deceased were not resident in Spain.
- The general deadline for filing Spanish Inheritance Tax is six months from the date of death.
- A six-month extension may be requested within the first five months following the death.
- The Spanish tax authority responsible for the inheritance and the regional tax rules that may be applied are separate questions.
- An inherited Spanish property will normally need to be properly documented and registered in the heir’s name before a future sale can proceed smoothly.
- Inheritance of urban property may also give rise to Spanish municipal tax obligations.
1. First Step: Determine Which Law Governs the Inheritance
Before dealing with an inherited property in Spain, it is important to determine which law governs the succession.
For successions falling within Regulation (EU) No 650/2012, the general rule is that the succession as a whole is governed by the law of the State in which the deceased had his or her habitual residence at the time of death.
However, the deceased may have made a valid choice of law in accordance with Article 22 of the Regulation, choosing the law of the State of his or her nationality to govern the succession.
This distinction can be crucial. A foreign national may own a house or apartment in Spain while the succession itself is governed by the law of another country. Conversely, Spanish succession law may apply in circumstances where the deceased’s connections with Spain satisfy the relevant rules.
The location of the property should therefore not be confused with the law governing the succession.
2. Does Spanish Law Automatically Apply Because the Property Is in Spain?
No. Under Regulation (EU) No 650/2012, the law determined under the Regulation generally governs the succession as a whole, irrespective of the nature of the assets and regardless of whether particular assets are located in Spain or elsewhere.
This principle is particularly important for international families whose estates contain assets in several countries. The Regulation seeks to avoid unnecessarily fragmenting the succession by applying different succession laws merely because assets are situated in different States.
However, the applicable succession law must be distinguished from Spanish property, registration and tax requirements. Even where foreign succession law governs the inheritance, Spanish formalities may still have to be completed in relation to real estate located in Spain.
3. Check the Will and the Succession Documents
The next step is to establish the legal basis on which the property passes to the heir or heirs.
Depending on the circumstances, the relevant documentation may include a Spanish will, a foreign will, a declaration of heirs in an intestate succession or, where applicable, a European Certificate of Succession.
In cross-border cases, it may also be necessary to establish whether the deceased executed more than one will and whether a Spanish will was intended to deal exclusively with Spanish assets.
Foreign documents intended to be used in Spain may require legalisation or an Apostille under the Hague Convention, where applicable, as well as an official translation into Spanish.
4. Do I Need a European Certificate of Succession?
Not necessarily. The European Certificate of Succession is a useful instrument created by Regulation (EU) No 650/2012 to enable heirs, legatees, executors and administrators to prove their status, rights or powers in another participating EU Member State.
It can be particularly useful in cross-border estates involving assets located in different European countries, but it is not mandatory in every international inheritance.
Whether it is the most appropriate instrument will depend on the structure of the succession and the documentation already available.
5. Do I Have to Pay Spanish Inheritance Tax on an Inherited Property in Spain?
Spanish Inheritance Tax must be considered whenever property in Spain is inherited.
A non-resident heir may be subject to Spanish Inheritance Tax by reason of acquiring assets or rights situated, exercisable or enforceable in Spanish territory. Therefore, the fact that both the deceased and the heir lived outside Spain does not necessarily remove the inheritance from Spanish taxation.
Where the heir is resident in Spain, different rules concerning personal liability may apply and the tax analysis must take account of the circumstances of the entire succession.
For international estates, it is therefore essential to determine both the residence position of the deceased and the residence position of each heir.
6. Which Spanish Tax Authority Deals With the Inheritance?
This is one of the areas in which international inheritances frequently cause confusion.
Where the deceased was non-resident in Spain, or where the relevant heir is non-resident in Spain, the Spanish State Tax Agency (Agencia Tributaria) may be competent to manage the Inheritance Tax, subject to the applicable statutory rules.
However, the authority responsible for managing the tax and the substantive tax rules that the taxpayer may be entitled to apply are not necessarily the same question.
Under the Spanish Inheritance and Gift Tax legislation, a taxpayer whose inheritance is managed by the State may, in the circumstances provided by law, be entitled to opt for the legislation of the relevant Autonomous Community. This possibility is not limited to residents of the European Union or European Economic Area; the Spanish Tax Agency expressly recognises its application to taxpayers resident in third countries where the statutory connecting factors are satisfied.
This can be financially significant because regional allowances, reductions and rebates may substantially affect the final tax liability.
7. What Is the Deadline for Spanish Inheritance Tax?
The general deadline for filing Spanish Inheritance Tax in a succession is six months from the date of death.
An extension for a further six months may be requested, but the request must be made within the first five months of the original filing period.
Foreign heirs should therefore avoid waiting until all succession formalities have been completed abroad before considering the Spanish tax deadline. International documentation, Apostilles, translations and the coordination of several heirs can take time.
If you have inherited property in Spain and the six-month deadline is approaching, the tax position should be reviewed promptly even if the succession documentation is not yet complete.
8. How Is an Inherited Property Valued for Spanish Inheritance Tax?
Property valuation is another important aspect of Spanish Inheritance Tax.
Under the current Spanish Inheritance and Gift Tax rules, where an inherited property has a cadastral “reference value” (valor de referencia), that value is generally taken as the value of the property for tax purposes at the date on which the tax arises, unless the value declared by the interested parties is higher.
If no reference value exists or it cannot be certified by the Spanish Cadastre, the applicable valuation rules must be examined separately. Under the statutory rules, the taxable value will generally be the higher of the value declared by the taxpayer and the market value, subject to the relevant rules on administrative verification.
The valor de referencia should not be confused with the valor catastral. They are different concepts and can have different tax functions.
9. What Documents Are Usually Required?
The documentation required will depend on the particular succession, but an international inheritance involving Spanish property commonly requires some or all of the following:
- Death certificate.
- Certificate from the Spanish General Register of Last Wills.
- Spanish or foreign will, or the relevant intestacy documentation.
- European Certificate of Succession, where appropriate.
- Passport or identification documents of the heirs.
- Spanish tax identification numbers for the heirs where required.
- Title deeds and/or Land Registry information concerning the Spanish property.
- IBI documentation and cadastral information.
- Documents relating to other Spanish assets, liabilities or deductible expenses.
- Apostilles or legalisation of foreign public documents where required.
- Official Spanish translations of foreign documents where required.
The precise documentation should be determined according to the facts of the estate rather than treating every international succession as identical.
10. Do Foreign Heirs Need a NIE or Spanish Tax Identification Number?
Foreign heirs will need to be properly identified for Spanish tax and notarial purposes.
Depending on their circumstances, a foreign heir may already have a Spanish NIE or may need to obtain the appropriate Spanish tax identification number before the inheritance can be fully processed.
This issue should be addressed sufficiently early in the procedure, particularly where several foreign heirs are involved, as identification requirements can otherwise delay the tax and notarial stages of the inheritance.
11. Do I Need to Sign an Inheritance Deed Before a Spanish Notary?
In many cases involving Spanish real estate, the succession will ultimately be formalised in a Spanish public deed of acceptance and adjudication of inheritance so that the heir’s title can be presented to the Spanish Land Registry.
The exact structure of the deed will depend on the succession law applicable to the estate, the title on which the heirs rely, the number of beneficiaries and the nature of the assets.
Where foreign succession law applies, the Spanish notarial and registration process may require appropriate evidence of the content and application of that foreign law.
This is one reason why international succession work often requires coordination between legal professionals in Spain and, where necessary, lawyers or notaries in the country whose succession law governs the estate.
12. Registering an Inherited Property in the Spanish Land Registry
Once the succession has been properly documented and the relevant tax requirements have been dealt with, the title can be presented to the competent Spanish Land Registry (Registro de la Propiedad).
The Registry will examine the succession title and the documents submitted in accordance with Spanish registration law.
Registration is particularly important if the heir intends subsequently to sell, mortgage or otherwise dispose of the property. Problems with the deceased’s registered title, discrepancies in the description of the property or an incomplete chain of ownership may need to be resolved before registration can be completed.
For this reason, obtaining an up-to-date Land Registry extract at an early stage is often advisable when dealing with inherited property in Spain.
13. Is There Any Municipal Tax When I Inherit Property in Spain?
Potentially, yes.
Where the inheritance involves urban land, the transfer may also fall within the scope of the Spanish municipal tax on the increase in value of urban land, commonly known as plusvalía municipal (IIVTNU), subject to the statutory rules governing the tax.
For transfers on death, the general statutory filing period is six months from the date of death, extendable up to one year at the request of the taxpayer. The applicable municipal ordinance and the circumstances of the property should be checked in each case.
This municipal tax is separate from Spanish Inheritance Tax. Completing one tax obligation does not automatically complete the other.
14. What If There Are Several Heirs?
Where several people inherit the Spanish property, the succession must determine the share or rights acquired by each beneficiary.
Depending on the applicable succession law and the agreement reached between the heirs, the property may ultimately be registered in co-ownership or may be adjudicated to one heir with appropriate arrangements concerning the other beneficiaries.
The tax and civil consequences of the proposed distribution should be considered before the inheritance deed is signed. Rearranging ownership after the inheritance has already been completed can potentially create additional legal and tax consequences.
15. What If I Do Not Want the Property?
An heir should not assume that inheriting a property necessarily means that he or she must retain it.
Depending on the law governing the succession, the heir may have different options concerning acceptance or renunciation of the inheritance. Those options, their formal requirements and their consequences must be analysed under the applicable succession law.
Particular care is required where the estate contains debts or liabilities. A decision concerning acceptance or renunciation should therefore be taken before carrying out acts that could have legal consequences under the law governing the succession.
16. Can I Sell an Inherited Property in Spain?
Yes. Once the heir’s title has been properly established and the necessary succession, tax and registration formalities have been dealt with, an inherited Spanish property can be sold.
However, it is advisable to resolve the inheritance properly before entering into a binding sale transaction. A prospective purchaser and the purchaser’s lawyer will normally expect the seller’s title to the property to be clear and capable of registration.
If the inherited property in Spain is going to be sold, the tax consequences of the subsequent sale should also be analysed separately from the taxes arising on the inheritance itself.
17. What If I Decide to Keep the Property?
If the heir retains the property, the legal work does not necessarily end with registration of the inheritance.
The new owner should ensure that local property tax records, community of owners’ records where applicable, utilities and other relevant administrative details are updated.
A non-resident owner should also obtain advice on the Spanish tax obligations associated with owning property in Spain, including the tax treatment applicable depending on whether the property is kept for personal use, rented or subsequently sold.
18. Common Mistakes After Inheriting Property in Spain
Some of the most common problems in international Spanish inheritances arise not from particularly complex estates, but from taking steps in the wrong order.
- Assuming that Spanish succession law automatically applies because the property is in Spain.
- Ignoring the six-month Inheritance Tax deadline while waiting for documents from another country.
- Failing to consider whether a tax extension should be requested within the first five months.
- Confusing the authority responsible for managing the tax with the regional tax legislation that may be available.
- Using foreign succession documents in Spain without the necessary formalities or translation.
- Overlooking the cadastral reference value when valuing Spanish real estate.
- Forgetting the possible municipal tax consequences of inheriting urban property.
- Trying to sell the property before the inheritance title and registration position have been properly resolved.
19. Frequently Asked Questions About Inherited Property in Spain
Do I have to travel to Spain to deal with the inheritance?
Not necessarily. Many steps in an international inheritance can be handled through appropriate legal representation and powers of attorney. Whether personal attendance is required will depend on the acts that need to be completed and the documentation available.
Does Spanish law apply because I inherited a house in Spain?
Not necessarily. The law governing an international succession must be determined under the applicable private international law rules. Under Regulation (EU) No 650/2012, habitual residence at death is the general connecting factor, subject to the other provisions of the Regulation, including a valid choice of the law of nationality.
How long do I have to pay Inheritance Tax in Spain?
The general filing period is six months from the date of death. A further six-month extension may be requested within the first five months of that period.
Can a non-resident inherit property in Spain?
Yes. Non-residence does not prevent a person from inheriting Spanish property. However, the inheritance may give rise to Spanish tax, notarial and registration obligations.
Can a non-EU resident benefit from Spanish regional Inheritance Tax rules?
Potentially, yes. Under the current Spanish rules, taxpayers resident in third countries may also opt for the legislation of the relevant Autonomous Community where the statutory connecting factors permit it. The applicable regional legislation must therefore be identified in each case.
Can I sell the Spanish property immediately after inheriting it?
The property can ultimately be sold, but the inheritance title, tax position and Land Registry situation should first be properly resolved. Attempting to sell before completing these steps can create avoidable difficulties during conveyancing.
Do I have to pay both Inheritance Tax and plusvalía municipal?
They are separate taxes. Spanish Inheritance Tax and the municipal tax on the increase in value of urban land have different legal bases and must be considered independently where the latter applies.
20. Legal Advice about Inherited Property in Spain
I am Raquel Yepes, Lawyer, and I advise foreign heirs on international succession matters involving assets in Spain, including the legal analysis of cross-border estates, Spanish Inheritance Tax, coordination of foreign succession documents, notarial inheritance procedures and registration of Spanish property.
Legal assistance is available in English, French and Spanish.
Where the succession is governed by foreign law, or requires action in another jurisdiction, the Spanish aspects of the inheritance can also be coordinated with lawyers or other legal professionals in the relevant country.
In a cross-border succession, taking the wrong step, or even taking the right steps in the wrong order, can result in unnecessary costs, delays and avoidable legal or tax complications. Proper legal coordination from the outset can therefore save considerable time, expense and difficulty throughout the inheritance process.
