It can be difficult to plan ahead when it comes to wills in Spain and Spanish inheritance. It’s a subject we tend to avoid. However, not making the necessary arrangements and talking them through with those people who it will affect, can have repercussions for those we care about.
Spanish inheritance tax can be hefty and although there are moves to change a law that treats residents and non-residents differently, this is still to find its way into practice.
Making a will in Spain provides an opportunity for you to talk through what the repercussions will be tax wise of the inheritance plans you have. Don’t expect the system to work the same as that in your own country.
There are other reasons for making a Spanish will. When you die it is not the time for those closest to you to be trying to sort out your affairs in another language and another country. If you have a will in Spain, it means it can be applied immediately without need for official translations or the Foreign Office.
If you have taken advice previously to make one or if you’ve not, we do need to draw your attention to some EU legislation that makes it even more crucial that you state your wishes when you die, in writing.
The Spanish law of succession
Different countries have different laws surrounding who you can and can’t leave your property to.
The law of succession in Spain means that when someone dies two-thirds of the total inheritance must go to the children who are the ‘legal beneficiaries’. This is different to the inheritance laws that apply in the UK and Ireland. In these countries you can make a will leaving your property to whoever you want.
Until recently this difference had not posed a problem for those living in Spain. However, new EU legislation means that Spanish national inheritance law will operate when a person dies irrespective of their nationality unless they have made a will to indicate that they want their own country’s laws to apply.
The new European law
The EU Succession Regulation (EU No. 650/ 2012) states that those people who habitually reside in a country for at least two years will have the national inheritance law of that country apply to them, unless their will requests otherwise.
The Regulation (EU) No. 650/2012 states: “EU citizens habitually residing in Spain (Residents) will be subject to the Spanish succession law, despite their nationality, unless they specifically state in their will the wish for the succession law of their country of origin to apply”.
If the correct clause isn’t included then the distribution of your inheritance will automatically revert to Spanish law. If you have no will at all, then Spanish law will also apply.
Please note that if you are a non-resident with property in Spain your own national law will dictate how you bequeathe your assets and this new piece of legislation does not apply to you.
The law is intended to make it easier to work out what inheritance law applies, however, this could be a problem if your will doesn’t specify which national law you want to follow. The new regulations come into effect from 17th August 2015 and we recommend that you ensure that your will includes the necessary clause.