First you establish which law governs the succession and what the estate contains, debts included, and only then do you accept, sign and pay the tax. A non-resident who inherits property in Galicia is taxed in Spain on a limited basis, only on assets located here, has six months from the death to file Spanish inheritance tax and may apply the Galician rules even if living outside the European Union, which for children and spouses usually brings the bill down to zero. If the order is reversed and a balance is collected or a division signed before the liabilities are known, the inheritance is treated as accepted outright, the option of accepting with benefit of inventory disappears and the deceased’s debts become payable out of the heir’s own assets as well.
The two clocks do not run in step. The tax deadline runs from the date of death even if the will is in another language, an heir cannot be located or nobody yet knows which law applies. The civil work has to be done inside those six months, or the extension requested before the fifth month ends. I take it in that order.
What is the inheritance law in Spain for non-residents
For deaths after 17 August 2015, the law governing the succession is fixed by Regulation (EU) 650/2012. Article 21 points to the law of the State in which the deceased was habitually resident at death, and article 22 allows the deceased to choose the law of his or her nationality in a will. The Regulation is of universal application (article 20), so Spanish notaries and courts apply it even when the deceased was British, Swiss or American.
Three situations come up again and again. The Galician who lived in Germany or Switzerland and leaves a flat in A Coruña, whose succession is governed by the law of his residence unless he chose Spanish law in his will, in which case, through his Galician civil status, the Galician Civil Law Act 2/2006 applies. The foreigner who retired to Galicia and died here, to whom Galician law applies because, where a State has several legal systems, article 36 of the Regulation refers to the law of the territorial unit in which the deceased resided. And the British or Irish person who never lived in Spain and owns a home in Galicia, for whom article 34 accepts the renvoi that his own law makes to the law of the place where the property is located, so that the Galician home is governed by Spanish law if no choice of law was made.
This matters because Galician law imposes forced shares. Descendants are entitled to one quarter of the net estate (article 243 of Act 2/2006), the surviving spouse to a life interest in one quarter if there are descendants and in one half if there are none (articles 253 and 254), and ascendants have no forced share. An English will leaving everything to a partner can be perfectly valid in England and at the same time leave the deceased’s children with an enforceable forced share over the flat in Galicia.
Foreign wills, declaration of heirs and the European Certificate of Succession
The document under which you inherit has to work before a Spanish notary and a Spanish Land Registry. The first items are the death certificate and the certificate from the Registro General de Actos de Última Voluntad, which states whether the deceased made a will in Spain and can be requested fifteen working days after the death. It is worth requesting even if the deceased was foreign, because many non-residents made a Spanish will covering only their assets here and the family knows nothing about it.
With a foreign will, three things are needed. The apostille under the Hague Convention of 1961, or legalisation if the country is not a party, a sworn translation into Spanish, and proof of the foreign law, because the notary and the registrar have to know that the document counts as a will and what effects it produces under its own law, which is shown by a certificate of law or an expert report. Not every foreign succession document is the equivalent of a Spanish will. An English grant of probate appoints an administrator of the estate, a figure Spanish law does not have, and that appointment has to be fitted into something the Registry will accept.
If the deceased lived in a State bound by the Regulation, the European Certificate of Succession under articles 62 and following simplifies the file. It is issued by the authority of the country of residence, in Spain the notary, takes effect in all bound States without apostille and is a sufficient title to register the property (article 69.5). The United Kingdom, Ireland and Denmark do not issue it.
If there is no will in any country, the heirs have to be formally declared. In Spain this is done by a notarial act of notoriety (articles 55 and 56 of the Notarial Act), and the competent notary is the one for the deceased’s last domicile in Spain, for the place where most of the estate is located or for the place of death, with two witnesses. The order of succession is set by the law governing the estate. If that is Spanish law, descendants inherit, failing them ascendants, then the spouse and then collateral relatives up to the fourth degree (articles 930 and following of the Civil Code), and failing all of them, in Galicia, the Autonomous Community (article 267 of Act 2/2006). If a foreign law applies, that order has to be proved too.
Every heir needs a Spanish foreigner identification number, the NIE, to pay the tax and register, and none of them has to travel if they grant an apostilled power of attorney in their own country with authority to accept, partition and settle.
Accepting, renouncing or accepting with benefit of inventory when there are debts
Whoever accepts outright answers for all the deceased’s debts, including with his or her own assets (article 1003 of the Civil Code). Accepting does not require signing anything. Article 999 treats the inheritance as accepted by any act that only an owner could perform, such as selling an asset, collecting a balance or letting the flat. Filing the tax return to avoid surcharges does not by itself amount to acceptance, but using the money does.
Before taking that step you need to know the liabilities. Mortgages, loans, community of owners’ fees, guarantees given for a child or a business and, very often, tax debts, which article 39 of the General Tax Act passes on to the heirs with the exception of penalties. If the deceased was the director of a company, claims may come from that direction.
When the liabilities are uncertain, the Civil Code offers the benefit of inventory (articles 1010 and following). It is declared before a notary, an inventory of assets and debts is drawn up within the deadlines of article 1017 and the heir then answers only up to the value of what was inherited. The condition is not having previously acted as heir. Anyone who does not hold the assets and has not disposed of anything can use it for as long as the right to accept has not lapsed (article 1016). Renunciation is also possible, by public deed and irrevocably.
The deceased’s accounts are in practice frozen. The bank will not release the balance until the heirs prove their title and the payment or exemption of the tax, because it is secondarily liable if it pays out without that check (article 8 of Act 29/1987). What the rules do allow is using money from the account itself to pay the tax, so there is no need to advance it from abroad, and doing so does not amount to acceptance.
There are things an heir can do today without committing to anything. Ask the bank for a certificate of balances at the date of death, withdraw or transfer nothing, gather the property tax and community receipts and any loan correspondence, and sign nothing with the other heirs, not even a private division agreement, until the liabilities are known. When the liabilities are in doubt, the firm fixes the inventory before anyone signs, and that is the first piece of work within our inheritance service.
Inheritance tax in Spain for non-residents
A Spanish resident is taxed on an unlimited basis, on everything inherited wherever it is (article 6 of Act 29/1987). A non-resident is taxed on a limited basis, only on assets and rights located in Spain (article 7), which includes the property, accounts with Spanish banks and shares in Spanish companies. Whatever is inherited in the heir’s own country is not declared here. Spain only has inheritance tax treaties with France, Greece and Sweden, so double taxation is normally corrected through the credit each country’s law grants for tax paid in the other.
Until 2014 non-residents paid under the State scale with none of the regional allowances, which the Court of Justice of the European Union held contrary to the free movement of capital in its judgment of 3 September 2014, case C-127/12. The second additional provision of Act 29/1987 introduced the correction for residents of the European Union and the European Economic Area, the Spanish Supreme Court extended it to residents of third countries and Act 11/2021 wrote that into the statute. Today an heir living in the United Kingdom, Argentina, Switzerland or the United States applies the regional rules on the same terms as one living in Lugo.
That same provision decides which regional rules. If the deceased lived in Galicia and the heir abroad, the Galician rules. If the deceased did not live in Spain, those of the region where the most valuable assets are located. What does not change is the tax authority. Because Act 22/2009 only transfers the tax on resident taxpayers to the regions, the non-resident files Form 650 with the Oficina Nacional de Gestión Tributaria of the Spanish Tax Agency in Madrid and must expressly opt for the Galician rules on filing. If no option is made, the return is assessed under the State rules and the result is a different one, as shown below.
Deadlines for paying and what happens if you miss them
The filing deadline is six months from the death (article 67 of the Inheritance Tax Regulations, Royal Decree 1629/1991). An extension of a further six months is available, but it must be requested within the first five, with the death certificate and the list of heirs and assets, and it carries late-payment interest (article 68). Requested in the sixth month, it is refused.
| Step | Deadline | Rule |
|---|---|---|
| File inheritance tax (Form 650) | Six months from the death | Article 67 of the Inheritance Tax Regulations |
| Extension of the filing deadline | A further six months, requested within the first five | Article 68 of the Inheritance Tax Regulations |
| Municipal capital gains tax on the inherited property | Six months, extendable to one year on request | Article 110 of the consolidated Local Finance Act |
| Certificate of last wills | Issued fifteen working days after the death | Registro General de Actos de Última Voluntad |
| Limitation period for inheritance tax | Four years from the end of the filing period | Article 66 of the General Tax Act |
| Payment of the 3 % withholding when a non-resident sells | One month from the sale, by the buyer | Article 25.2 of the Non-Resident Income Tax Act |
If the tax is filed late without any prior demand, article 27 of the General Tax Act imposes a surcharge of one per cent plus a further one per cent for each complete month of delay, and after a year a surcharge of fifteen per cent plus interest. If the Tax Agency detects it first, there is a penalty. In the meantime the bank does not release the money and the Registry does not register the property.
Limitation has a rule of its own for inheritances documented abroad. The authority’s right to assess lapses four years after the end of the filing period, but article 25.2 of Act 29/1987 provides that, where the inheritance is recorded in a document executed before a foreign authority, the period only starts running when that document is presented to a Spanish authority. An inheritance deed signed in Buenos Aires ten years ago and never presented here is not time-barred. Conversely, an heir who discovers years later an account or a plot in Galicia belonging to an estate already settled in Spain files a supplementary return and, if more than four years have passed, obtains the record of limitation that allows registration without payment.
Anyone who paid under the State rules when the Galician rules were available can apply for rectification of the self-assessment and a refund of the excess, with interest, within those same four years. For payments made before 2015 the window has almost always closed, but assessments on residents outside the European Union made between 2015 and 2021 deserve a check of the dates.
How inheritance tax on property in Spain is calculated for non-residents
The taxable value of a property is no longer whatever the heir chooses to declare. Since 2022, article 9 of Act 29/1987 takes as the base the reference value published by the Cadastre, unless the declared value is higher, and the market value if the property has no reference value. It can be looked up on the Cadastre’s online office and it can be challenged. If the heir considers it exceeds the real value because of the condition of the property, encumbrances or location, the value can be contested on filing or through a later rectification, and it is the Cadastre that must justify its calculation with a report. Household effects are added to the assets, which the law presumes at three per cent of the estate (article 15) and which the Supreme Court has limited to items of personal use, excluding money, investments and property that is not a dwelling.
The deceased’s debts that can be proved are deducted, the mortgage among them, together with funeral and last illness expenses (articles 13 and 14). The kinship allowance of article 20 is then applied to that base, with four groups. Group I, descendants under twenty-one. Group II, adult descendants, spouse and ascendants. Group III, siblings, uncles, aunts, nephews, nieces and in-laws. Group IV, cousins and unrelated persons. The State allowances are 15,956.87 euros for groups I and II, with an addition for each year under twenty-one, 7,993.46 euros for group III and nothing for group IV.
Galicia raises the allowance for groups I and II to 1,000,000 euros per heir and applies its own scale of five to eighteen per cent to the excess. A non-resident son inheriting from his father, a resident of A Coruña, a flat with a reference value of 150,000 euros and an account of 20,000 euros has a base of 170,000 euros, does not exhaust the Galician allowance and pays no inheritance tax. The same son, if he does not opt for the Galician rules on Form 650, is taxed with the State allowance and the article 21 scale, which starts at 7.65 per cent and rises to 34, and the bill comes to around 22,000 euros. For siblings, nephews and nieces the Galician allowance is far smaller and the bill is also multiplied by the article 22 coefficients, which rise with the remoteness of the relationship.
On top of all this comes the municipal tax on the increase in value of urban land (articles 104 and following of the consolidated Local Finance Act), which the heir pays to the municipality where the property is located on the cadastral value of the land, and which is not due if it is shown that the land has not gained value since the deceased acquired it.
How to reduce inheritance tax in Spain as a non-resident
The lawful routes are few and all of them depend on getting the above right. The first is to apply the Galician rules, which are not applied automatically. The second is to deduct every debt that can be proved and not to accept a reference value that does not match the property.
The third is to bring the transfer forward in lifetime, and here the sums do not always add up. Galicia taxes gifts from parents to children made by public deed on a reduced scale that starts at five per cent from the first euro, whereas on inheritance the same child has the million-euro allowance. Gifting a property also triggers a capital gain for the donor under personal income tax, or under non-resident income tax if the donor lives abroad, which an inheritance does not. For a child, inheriting a Galician property is usually cheaper than receiving it as a gift, and a gift only pays off for reasons other than tax. What does change the calculation are the Galician succession agreements, the apartación and the pacto de mejora, which are taxed as an inheritance rather than a gift and which are explained in this article on the apartación and the pacto de mejora. They require the deceased to hold Galician civil status and Galician law to govern the succession, which for a Galician living abroad means a choice of law under article 22 of the Regulation.
Renunciation is no shortcut either. If an heir renounces outright, those who receive the share are taxed according to their own relationship to the deceased, but if the renunciation is in favour of a named person, article 28 of Act 29/1987 treats it as an inheritance followed by a gift and both taxes are paid. Renouncing so that one’s children inherit only works if the law governing the succession calls them in that place, because under Spanish intestate succession, where there are several heirs of the same degree, the share of the one who renounces accrues to the others and does not pass to his children (article 923 of the Civil Code).
After inheriting, what the non-resident owner pays and what happens on a sale
Once the property is registered, the non-resident heir has obligations of his own. The annual property tax, the IBI, and Non-Resident Income Tax, Form 210, which taxes a deemed income even if the flat is empty, of 1.1 per cent of the cadastral value if it has been revised or 2 per cent if not, at a rate of 19 per cent for residents of the European Union and the European Economic Area and 24 per cent for everyone else. If the flat is let, the rent is declared at those same rates, and only residents of the Union and the Economic Area may deduct expenses.
On a sale, the buyer must withhold three per cent of the price and pay it to the Tax Agency on account of the seller’s tax within one month (article 25.2 of the consolidated Non-Resident Income Tax Act, Royal Legislative Decree 5/2004). The seller then declares the gain, taxed at 19 per cent for all non-residents, and recovers whatever part of the withholding exceeds the final bill. The gain is the difference between the sale price and the acquisition value, which for an inherited property is the value declared for inheritance tax plus the inheritance tax paid, the municipal capital gains tax and the notary and registry costs. Declaring a low value in the inheritance saves nothing if a sale is planned, because it shifts the burden to the gain on the sale, at a rate higher than the one a child pays on inheritance in Galicia. The municipal capital gains tax falls due again on the sale, this time on the seller.
Sales often collapse because one heir will not sign or cannot be found, and the flat can neither be sold nor registered in the name of one heir without all of them. An heir who stays silent can be served a notarial demand to accept or renounce within thirty days, and silence counts as acceptance (article 1005 of the Civil Code). For the division, Act 2/2006 allows, under certain conditions, the heirs representing a majority of the estate to carry it out with notice to the others, and as a last resort there is the judicial division of the estate.
Frequently asked questions
Can I accept the inheritance with benefit of inventory so that my own assets do not answer for the deceased’s debts?
Yes, provided you have not already acted as heir. The benefit is declared before a notary and an inventory of assets and debts is drawn up within the Civil Code deadlines, after which you answer for debts only with what you inherit. If you have already collected balances, sold or let a property, acceptance has taken place tacitly and the benefit is no longer available.
How is a declaration of heirs made in Spain if the deceased left no will in any country?
Through a notarial act of notoriety before a Spanish notary, under articles 55 and 56 of the Notarial Act, with the death certificate, the certificate of last wills and two witnesses. The notary declares as heirs those called by the law governing the succession, which must be proved if foreign, and that act serves to accept, pay the tax and register the property.
Where the firm starts with an inheritance received from outside Spain
The first thing I look at in an enquiry of this kind is how much of the six months is left, because that decides whether the extension has to be requested before anything else. Then which law governs the succession and which document will prove it, and third what the liabilities are, because those two answers decide whether the estate is accepted outright, with benefit of inventory or not at all. The specific risk in these inheritances is twofold, the surcharge for filing late and tacit acceptance through touching the money too early, and both are avoided by keeping to the order I have described. The firm prepares the complete file from A Coruña without the heir having to travel, and the first consultation is already work on your case. You can put it to us through the inheritance service, the contact form or on +34 677 841 007, and we reply as soon as we can.