Inheritance for foreigners: everything you need to know
If you receive an inheritance, whatever your situation, you will have to complete a series of formalities to accept or renounce it. You will also have to pay a number of taxes within six months of the death of the deceased. Keep in mind that the Spanish Tax Agency (Agencia Tributaria) will not notify you of them. You therefore have to handle each of the tax settlement formalities yourself.
At the same time, be clear that the six months run from the death of the person whose estate you inherit, not from the moment you accept the inheritance.
In this article we explain, step by step, the formalities to keep in mind when handling an inheritance, whether the deceased was a Spanish national or a foreigner.
Which documents do we need for the process?
After the death of the deceased, if you are one of the heirs to the estate, you will need to obtain a series of documents to process the inheritance:
- Death certificate
- Certificate of last wills
- Life insurance certificate
- Locating the will
- Proof of foreigner status
Below we explain how to obtain each of them, step by step. Note that for the first four items, to obtain this type of certificate you must first determine whether the deceased died in Spain or in another country.
Death certificate
If the person died in Spain, the certificate is requested free of charge from the Civil Registry (Registro Civil). It can be requested online, in person at the registry of the town where the death was recorded, or by post.
If, on the other hand, the person died abroad and held Spanish nationality, the death will be recorded in the Consular Civil Registry (Registro Civil Consular). You will therefore have to request the certificate from the relevant consulate. If the deceased held another nationality at the time of death, the certificate must be requested from the competent authorities of the country where the death occurred.
Certificate of last wills
If the deceased was Spanish
If the deceased was Spanish, this certificate must be requested from the General Registry of Last Wills (Registro General de Actos de Última Voluntad). At least 15 days must have passed since the death before it can be processed.
You must also pay fee 790 (tasa 790) and submit the death certificate with the application. Like the death certificate, it can be requested in person or online.
If the deceased was a foreigner
If, on the other hand, the deceased was a foreign national, you must provide the certificate from the equivalent registry of last wills in the country concerned. If no such registry exists, you must prove that it does not exist, or any other reason that prevents you from submitting that certificate.
Life insurance must be handled directly in the country and with the financial institution with which the life insurance policy was taken out.
If you are a citizen of a country that has ratified the European Succession Regulation, you must submit the European Certificate of Succession.
Locating the will
Where the deceased was Spanish, the latest will appears on the certificate of last wills. The next step is then to go to the notary's office named in the will with the documents that prove you are an heir. These are:
- The family book (libro de familia),
- DNI (Spanish national identity document),
- Death certificate.
Finally, you must request an informational copy (copia simple).
If, on the other hand, the deceased was a foreigner, you must submit the will duly translated and legalized by the competent country. If the deceased was a citizen of the European Union, the European Certificate of Succession may be submitted.
Proving your status as heir
Lastly, you must complete the formality of proving that you are an heir of the deceased. To do so, you will have to submit the birth certificate of the deceased and those of the other heirs.
Here we need to distinguish according to nationality and the relationship with the deceased.
If the persons were born in Spain, the birth certificates can be obtained from the Civil Registry of the town where the deceased and the heirs were born. If they were born abroad and the birth is recorded in the Consular Civil Registry, a copy of the certificate must be requested from the relevant consulate.
Otherwise, you will need to contact the authorities of the country of birth and ask them to issue that certificate.
In addition, if you are the spouse of the deceased, you must also provide the marriage certificate.
If the marriage took place in Spain, it is requested from the Civil Registry where you married. If, on the other hand, you married in another country and the marriage is recorded in the relevant Consular Civil Registry, the copy must be requested from the relevant consulate. If no such record exists, you will have to go to the competent authority in the country where you married.
These are the last certificates needed to process an inheritance involving foreigners. Once you have located each of them, you can go to the notary and start the process.
Which rules govern an inheritance involving foreigners in Spain?
On the one hand, there are the rules that govern the inheritance itself, that is, those that set out the procedure for distributing the estate of a deceased person. On the other, there are the tax rules, which determine which taxes apply.
Regulation (EU (European Union)) No 650/2012 of the European Parliament and of the Council of July 4, 2012. This regulation is also known as the European Succession Regulation, and it governs successions within the scope of European law.
Before the European regulation came into force, inheritances were governed by Article 9.9 of the Spanish Civil Code:
"Succession upon death is governed by the national law of the deceased at the time of death, whatever the nature of the assets and the country where they are located."
Since the regulation came into force, an inheritance is governed by the law of the country where the deceased was resident, unless that person chose in their will to apply their national law or the law of the country with which they had ties. As a general rule, the law of the country of residence of the deceased applies.
Tax rules that apply to an inheritance involving foreigners
As mentioned, there are also other rules that govern the formalities and procedure of an inheritance involving foreigners. These are the tax rules that regulate the taxes due on a succession of assets.
Which taxes must be paid when receiving an inheritance in Spain?
- Inheritance Tax (Impuesto de Sucesiones): this tax does not have the same rate in every Autonomous Community, since its management has been devolved to them.
The deadline for paying this tax is 6 months from the death of the deceased. An extension of a further 6 months may also be requested if necessary. What matters is that the extension must be requested before 5 months have passed since the death.
- Municipal capital gains tax (plusvalía municipal): this must be paid if the estate includes real estate. Its full name is the Tax on the Increase in Value of Urban Land (Impuesto sobre el Incremento de Valor de los Terrenos de Naturaleza Urbana).
The period for paying the plusvalía is 6 months from the person's death, the same as for inheritance tax. In this case, a longer extension can be requested, namely up to one year, at the request of the taxpayer.
Settling these taxes is very important, since without it you will not be able to register the acquisition of the property in the Land Registry (Registro de la Propiedad).
If you are a resident foreigner and inherit assets from a person who was resident in a European Union country
Furthermore, if you are from another country, live in Spain and have inherited from a person who was resident in a European Union country, you must pay tax on all the assets, both those located abroad and those in Spain.
However, depending on the Autonomous Community where you live, you may receive certain tax allowances. Where all the assets are abroad, the allowance applied will be that of the community where the heir lives.
You will also be able to deduct the other country's taxes for each property located outside Spain.
If you are a non-resident foreigner and inherit assets from a person who was not resident in a European Union country
As in the previous case, you must pay all the taxes of each country, with the difference that you will not be able to benefit from tax allowances in Spain. You will also be able to deduct the foreign country's tax for the properties that are not located in Spain.
If you are a non-resident foreigner and inherit assets in Spain from a person who was resident in a European Union country
In this third case, you must pay Spanish Inheritance Tax only on the assets located in Spain. You will also be able to take advantage of the tax allowances and reductions granted by each Autonomous Community.
