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You are here: Home Finance & Business Tax Inheritance and gift tax in Spain

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21/10/2003Inheritance and gift tax in Spain

Inheritance and gift tax in Spain If you are a long-term Spanish resident, it is likely you will come across inheritance and gift tax. Here are the details.

Inheritance tax is payable on the increase of wealth, obtained by reason of death. Gift tax is levied on the increase of wealth, produced by reason of gift while the transferor is still living.

Inheritance and gift tax are levied on the following:

  • The acquisition of assets and rights by way of succession. Foreign people must pay inheritance tax in Spain only for those assets the deceased left in Spain.
  • Obtaining assets and rights by way of gift or any other gratuitous transfer inter vivos (during transferor's lifetime).
  • Acquisition of revenue from a life insurance policy, where the contractor party is a different person from the beneficiary.

Payment of this tax is not made by the estate — each beneficiary must pay it individually. It must be paid by:

  • The inheritors, who acquire the assets by reason of the decedent's death. The tax is payable by the beneficiaries and not by the estate. This tax shall be paid before the beneficiary can deal with the deceased's assets. When it is the inheritors' decision to sell the assets that the decedent left in Spain, they first must pay inheritance tax. It is advisable to seek the assistance of a Spanish Lawyer in order to speed up the procedure and get advice on potential tax saving schemes.
  • The grantees, who acquire the assets by reason of a gift or gratuitous transfer inter vivos (among people still alive).
  • The beneficiaries of the insurance policy, where the contractor party is a different person from the beneficiary.

These are only general guidelines and not definitive statements of the law. All questions about the law's applications to individual cases shall be directed to a Spanish lawyer.

Article by iAbogado Servicios Jurídicos SLU (Madrid, Spain). Visit iabogado.com for more original content like this.


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