Requirements for Inheriting Property in Spain as a Foreigner
Inheriting property in Spain as a foreigner is a legal process that requires compliance with specific requirements and procedures. While the process is similar to that for residents, there are particular aspects to consider depending on your nationality, residency, and the type of property being inherited. Below, we explain the key points you need to know if you find yourself in this situation.
1. Legal Capacity to Inherit
First and foremost, it’s important to note that any person, whether a resident or not in Spain, can inherit property. However, to do so, the individual must have the necessary legal capacity, meaning they must be of legal age (18 years old in Spain) and be in full use of their civil rights.
Key Requirement:
- Legal capacity to inherit: Being of legal age and legally capable of accepting the inheritance.
2. Determining the Applicable Jurisdiction (Inheritance Law)
One of the first decisions to be made is under which law the inheritance will be governed. In Spain, inheritance laws are regulated by the Spanish Civil Code, but foreigners may be entitled to apply the laws of their home country instead of Spanish law, thanks to European regulations.
The applicable inheritance law depends on the following:
- Spanish law: If the deceased was a resident in Spain or if the property is located in Spain.
- Foreign law: If the deceased was a resident of another country and the property is not located in Spain. In this case, the laws of their country of residence can apply, provided it is stipulated in the will.
European Regulation (EU Regulation 650/2012): EU citizens have the option to choose the laws of their habitual residence at the time of making the will, and these laws will also apply to the inheritance of assets located in Spain.
3. Death Certificate and Will
To begin the inheritance process, certain documents are required to prove the death of the property owner. These documents are essential for completing the procedures and transferring the property.
Required Documents:
- Death certificate: A document confirming the death of the property owner.
- Will: If the deceased left a will, this document is crucial for the distribution of the assets. If there is no will, the inheritance will follow the rules of intestate succession (without a will).
- Declaration of heirs: If there is no will, a judicial declaration is required to determine who the legal heirs are.
4. Payment of Inheritance Taxes
In Spain, heirs are required to pay an Inheritance and Donations Tax on the value of the inherited assets. This tax varies depending on the region where the property is located, as each autonomous community has its own regulations and deductions.
Key aspects of the Inheritance Tax:
- Taxable base: Calculated based on the value of the inherited property.
- Tax rate: Varies depending on the degree of relationship between the deceased and the heir. Direct family members (such as children or spouses) typically face lower tax rates than distant relatives or non-relatives.
- Reductions and deductions: Each autonomous community offers different reductions and deductions, which can significantly influence the tax cost.
It is important for foreigners to be informed about the possible reductions or deductions applicable in the autonomous community where the property is located.
5. Notarial Procedures and Property Registration
Once the validity of the will is verified and the corresponding taxes have been paid, the next step is to formalize the inheritance before a notary and register the property in the heir’s name.
Key Steps:
- Notarial signature: The heir must sign the deed of acceptance of the inheritance before a notary in Spain. This document specifies which assets are being inherited and how they are distributed.
- Property Registration: After signing the deed of acceptance, the property must be registered in the new owner’s name in the corresponding Property Registry. This step is necessary for the transfer of the property to be official and recognized.
6. Need for a Foreigner Identification Number (NIE)
Foreigners inheriting property in Spain must obtain a Foreigner Identification Number (NIE), which is necessary to carry out any legal procedures in the country, such as signing the inheritance deed or registering the property.
Key Requirement:
- Obtain NIE: All foreigners must have an NIE to complete official procedures related to inheritance in Spain.
7. International Tax Considerations
If the heir resides in another country, it is important to consider international tax agreements and how they affect the inheritance taxation. Spain has double taxation agreements with several countries, which may influence the amount of tax to be paid in both countries.
It is advisable to consult with an expert in international tax law to ensure compliance with all tax obligations both in Spain and the heir’s country of residence.
