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Go Back   Pollensa Forum > LIVING & WORKING IN POLLENSA > Living & Working in the Pollensa Area

Living & Working in the Pollensa Area This forum is for any comments, questions and advice about living (permanently or temporarily) and working in the Pollensa area. Aimed at ex-pats, property owners etc.

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  • 1 Post By Disorderly

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Old 10-01-2018, 19:04
Join Date: Feb 2008
Location: Lancaster
Posts: 583
Default Spanish Inheritance Tax

My wife and I are retiring and are planning the purchase of an apartment in PP, for our own and family holiday use only as non residents. This Forum has been invaluable to research the costs involved in buying, locating a local solicitor, choosing a bank and understanding ongoing costs and taxes.
As a result, we have a good grasp of all that and are coming out in March and April to seek a property......we feel so lucky to be able to finally do this.

However, thereís one thing I canít get my head around (though I suppose the solicitor will) and that is the inheritance tax question. We are a married couple planning to buy in joint names (though that involves two NIE numbers and annual returns as I understand it), and we have two grown up sons ( our sole beneficiaries).

So here is where Iím struggling......if one of us snuffs it, whatís the Spanish inheritance tax liability. Iíve read countless articles and remain thoroughly confused. Any ideas?
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Old 10-01-2018, 20:25
Join Date: Feb 2009
Location: West Yorkshire
Posts: 1,087

I am sure someone will be able to give you detailed advice on this one - but I do know from our own experience years ago that it is very important to make a 'Spanish' will regarding the property. Best of luck with your new venture
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Old 10-01-2018, 23:23
Join Date: Feb 2008
Location: Lancaster
Posts: 583

Thanks Rosie.....good advice.
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Old 11-01-2018, 10:37
Deanscroft's Avatar
Join Date: Feb 2010
Location: Puerto Pollenca
Posts: 431

When making a Spanish Will if you are non-Spanish, non-Resident, be sure to include the phrase 'Estate to be dealt with under the inheritance laws of the United Kingdom'. If the will doesn't include this then it will be governed by Spanish law. Under Spanish law your estate is divided up according to a formula set down here which will not necessarily be how you want it divided. Very broadly under Spanish law the first third goes to the first direct heir, the second third is divided equally amongst all the direct heirs, and only the last third can you decide.
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Old 11-01-2018, 18:29
Join Date: Feb 2008
Location: Lancaster
Posts: 583

Thanks Deanscroft. Where I may be confused is that I gained the impression that even if one makes wills as you suggest, there is still a tax liability on the beneficiaries. Perhaps Iím mistaken?
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Old 11-01-2018, 20:00
Join Date: Aug 2008
Location: Puerto Pollensa
Posts: 2,062

There is a tax liability. If one dies then the other person has to pay tax on the deceased 50% share of the property. Someone will correct me if I'm wrong but I believe they have now bought non residents in line with residents and although it varies all the time at the moment I think it is 1%.
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Old 11-01-2018, 21:12
Join Date: Feb 2008
Location: Lancaster
Posts: 583

Thanks Lillipop. That sounds reassuringly and unexpectedly painless. Another box ticked and something else not to worry about.

Your response much appreciated.

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Old 12-01-2018, 10:31
Deanscroft's Avatar
Join Date: Feb 2010
Location: Puerto Pollenca
Posts: 431

Not quite.
The tax liability depends on the relationship. The closest (son or daughter) pays the least, second is the wife/husband, then it increases the more distant the relationship.
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Old 12-01-2018, 16:38
Join Date: Nov 2017
Location: Surrey
Posts: 20

Gosh....hadn't given this a moments thought! Better get it sorted ourselves!
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Old 12-01-2018, 17:00
car77's Avatar
Join Date: Apr 2009
Posts: 136

Disorderly - I've sent you a PM
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