Every Autonomous Community has its own regulations about the Spanish inheritance tax.
Who is bound by the Spanish inheritance tax
- Taxpayers who have their habitual residence in Spain, regardless of where are located the properties or rights inherited.
- Are also required to pay the tax, the non-residents in Spain receiving property and / or rights located in Spain by the way of inheritance.
- Likewise will be obliged by the Spanish inheritance tax, the reception of amounts resulting from life insurances when the contract was made with Spanish insurers or has been hired in Spain with foreign entities which operate in the Spanish territory.
The tax base of the inheritance tax in Spain
The tax base of the inheritance tax in Spain is the net value of the individual acquisition of each heir, being understood as the real value of the property and rights reduced by any charges and debts that may be deductible in accordance with the State or Autonomous communities regulations.
Can be deducted generally the amounts owed by the deceased as long as their existence is proved. Also will be deductible of the Inheritance tax the amounts owed by the deceased to any of the public administrations in Spain.
The tax benefits. Reductions on the base of the inheritance tax
In the calculation of the inheritance tax in Spain, to the net value (value of properties and rights minus debts) of the goods inherited, depending on the family relationship with the deceased and the type of property inherited, will apply reductions on the tax base. These are the reductions according to the State regulations
| Relationship groups | Reductions according to State rules |
|---|---|
| Group I: descendants and adopted under 21 years | Reduction € 15,956.87 + 3.990'72 € / year less than 21.Limit: € 47,858.59 |
| Group II: descendants and adopted 21 years and over. Ascendants. Spouses | Reduction € 15,956.87 |
| Group III: Family collaterals 2nd and 3rd degree. Ascendants and descendants in law | Reduction € 7.993,46 |
| Reduction for habitual residence | 95% limit of € 122,606.47 |
| Disabilities | Disability =/> 33% and less than 65% » € 47858.59Disability =/> 65% » € 150,253.03 |
| Life insurance spouse, ascendants and descendants | 100% Limit € 9,195.49 |
| Reduction due to inheritance Family business | 95%* |
| Reduction due to inheritance of historical heritage | 95%* |
| Reduction due to inheritance Farming business | from 50% up to 90%* |
* There are more specific rules. Consult us to know the exact figures of your Spanish inheritance tax
These reductions of the Spanish inheritance tax are according to State law. This regulation applies to the taxpayers who are not resident in Spain nor in a country pertaining to the EU or EEA. For the rest of the cases, the inheritance tax is ruled by the Autonomous community where the properties, representing the largest value of the estate, are located.
Not existing property to inherit in Spain, will apply the rules of the Autonomous community in which each heir resides. And, being the deceased resident in Spain, by the rules of the community where he resided.
Once already it’s been implemented the appropriate reductions to the tax base of the inheritance tax, we have the net tax base, on which the tax rate will apply.
Spanish inheritance tax rates
To the reduced net value is applied the following tax rates:
Tax rates according to State rules
| Net tax base up to € | Gross Tax payable € | Rest net tax base up to € | Applicable Rate % |
|---|---|---|---|
| 0,00 | 7.993,46 | 7,65 | |
| 7.993,46 | 611,50 | 7.987,45 | 8,50 |
| 15.980,91 | 1.290,43 | 7.987,45 | 9,35 |
| 23.968,36 | 2.037,26 | 7.987,45 | 10,20 |
| 31.955,81 | 2.851,98 | 7.987,45 | 11,05 |
| 39.943,26 | 3.734,59 | 7.987,45 | 11,90 |
| 47.930,72 | 4.685,10 | 7.987,45 | 12,75 |
| 55.918,17 | 5.703,50 | 7.987,45 | 13,60 |
| 63.905,62 | 6.789,79 | 7.987,45 | 14,45 |
| 71.893,07 | 7.943,98 | 7.987,45 | 15,30 |
| 79.880,52 | 9.166,06 | 39.877,15 | 16,15 |
| 119.757,67 | 15.606,22 | 39.877,16 | 18,70 |
| 159.634,83 | 23.063,25 | 79.754,30 | 21,25 |
| 239.389,13 | 40.011,04 | 159.388,41 | 25,50 |
| 398.777,54 | 80.655,08 | 398.777,54 | 29,75 |
| 797.555,08 | 199.291,40 | higher amounts | 34,00 |
Not existing property to inherit in Spain, will apply the rules of the Autonomous community in which each heir resides. And, being the deceased resident in Spain, by the rules of the Autonomous community where he resided.
The tax liability
The tax payable inheriting in Spain is obtained by applying to the Gross payable tax, the multiplying coefficient depending on the pre-existing assets of the heir.
| Multiplying Coefficients. State rules | |||
|---|---|---|---|
| Pre-existing assets € | Relationship Groups | ||
| I y II | III | Rest | |
| From 0 up to 402.678,11 | 1,0000 | 1,5882 | 2,0000 |
| Over 402.678,11 up to 2.007.380,43 | 1,0500 | 1,6676 | 2,1000 |
| Over 2.007.380,43 up to 4.020.770,98 | 1,1000 | 1,7471 | 2,2000 |
| Over de 4.020.770,98 | 1,2000 | 1,9059 | 2,4000 |
These multiplying coefficients used to calculate the Spanish inheritance tax are according to State law. This regulation applies to the taxpayers who are not resident in Spain nor in a country pertaining to the EU or EEA. For the rest of the cases, the different regulations of the Autonomous communities determine the Spanish inheritance tax.
Deduction in case of international double taxation by inheritance tax
When the taxation is due to PERSONAL LIABILITY, the taxpayer is entitled to deduct the lower of the following two amounts:
- The actual amount of the paid abroad in respect of similar tax that affects the current capital gains subject to tax in Spain by the Inheritance tax.
- The result of applying the effective average rate of the Spanish inheritance tax to the capital gains coming from goods or rights located abroad, on which is been already applied a similar tax by a foreign country.
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