Inheritance Tax - everyone should read

DJinSpain · 06-07-2009, 17:29

I received an email from an English lady who owns a second home in Spain. After the death of her husband she was shocked to get a bill for Spanish Inheritance Tax.

Financial Pages in Spain

My blog has more detail. I hope you will read it and pass it on to all your contacts, whether Spanish resident or property owners.

DJ

dunmovin · 10-07-2009, 06:06

I have to admit that my only worry about this tax,is the survivng spouse. If we both die at the same time, then whoever gets the house(if they want it) can pay the tax, which will be far below the actual value of the place

DJinSpain · 10-07-2009, 08:13

The surviving spouse is one of the big differences between the UK and Spanish versions. The story in my blog shows how many British people in Spain 'assume' that the systems are similar.

Personally, I think all potential beneficiaries should know the situation because the tax has to be paid within six months.

dunmovin · 10-07-2009, 08:29

what happens if the person defaults on the tax? Doesn't really affect me or my wife as we have set aside funds for just such an occassion

DJinSpain · 10-07-2009, 09:14

The tax authorities will seize the assets!

Well they can do that, but they normally negotiate an agreed payment route.

dunmovin · 10-07-2009, 09:22

I think if you choose to leave your house to someone, it would only fair to tell them and warn about tax implications, or have the tax paid from the estate.

El Gordo · 10-07-2009, 10:56

Quote:

Originally Posted by dunmovin

I think if you choose to leave your house to someone, it would only fair to tell them and warn about tax implications, or have the tax paid from the estate.

The tax cannot be paid from the Estate, and you cannot borrow against a property which is not yet yours either.

dunmovin · 10-07-2009, 11:37

then a part of the estate set, aside strictly for this purpose and payable only when the estate is settled

JazminesII · 10-07-2009, 13:21

A spanish person told me that many locals ignore this tax.......I'm told if its not paid in 7 years its no longer due.......illegal for sure but evidently an approach locals use.

El Gordo · 10-07-2009, 18:57

Quote:

Originally Posted by dunmovin

then a part of the estate set, aside strictly for this purpose and payable only when the estate is settled

Nice idea, but upon death, all accounts are frozen. Something to bear in mind if you only have a joint account!!

06-07-2009, 17:29	#1 (permalink)
DJinSpain DJinSpain is networking, social and business Regular Member Join Date: Feb 2009 Posts: 9 Thanks: 0 Thanked 0 Times in 0 Posts Rep Power: 0	Inheritance Tax - everyone should read I received an email from an English lady who owns a second home in Spain. After the death of her husband she was shocked to get a bill for Spanish Inheritance Tax. Financial Pages in Spain My blog has more detail. I hope you will read it and pass it on to all your contacts, whether Spanish resident or property owners. DJ

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10-07-2009, 06:06	#2 (permalink)
dunmovin dunmovin is.... Spain Guru Join Date: Nov 2008 Location: Gorga, Alicante Posts: 1,333 Thanks: 56 Thanked 132 Times in 112 Posts Rep Power: 0	I have to admit that my only worry about this tax,is the survivng spouse. If we both die at the same time, then whoever gets the house(if they want it) can pay the tax, which will be far below the actual value of the place

10-07-2009, 08:13	#3 (permalink)
DJinSpain DJinSpain is networking, social and business Regular Member Join Date: Feb 2009 Posts: 9 Thanks: 0 Thanked 0 Times in 0 Posts Rep Power: 0	The surviving spouse is one of the big differences between the UK and Spanish versions. The story in my blog shows how many British people in Spain 'assume' that the systems are similar. Personally, I think all potential beneficiaries should know the situation because the tax has to be paid within six months.

10-07-2009, 08:29	#4 (permalink)
dunmovin dunmovin is.... Spain Guru Join Date: Nov 2008 Location: Gorga, Alicante Posts: 1,333 Thanks: 56 Thanked 132 Times in 112 Posts Rep Power: 0	what happens if the person defaults on the tax? Doesn't really affect me or my wife as we have set aside funds for just such an occassion

10-07-2009, 09:14	#5 (permalink)
DJinSpain DJinSpain is networking, social and business Regular Member Join Date: Feb 2009 Posts: 9 Thanks: 0 Thanked 0 Times in 0 Posts Rep Power: 0	The tax authorities will seize the assets! Well they can do that, but they normally negotiate an agreed payment route.

10-07-2009, 09:22	#6 (permalink)
dunmovin dunmovin is.... Spain Guru Join Date: Nov 2008 Location: Gorga, Alicante Posts: 1,333 Thanks: 56 Thanked 132 Times in 112 Posts Rep Power: 0	I think if you choose to leave your house to someone, it would only fair to tell them and warn about tax implications, or have the tax paid from the estate.

10-07-2009, 11:37	#8 (permalink)
dunmovin dunmovin is.... Spain Guru Join Date: Nov 2008 Location: Gorga, Alicante Posts: 1,333 Thanks: 56 Thanked 132 Times in 112 Posts Rep Power: 0	then a part of the estate set, aside strictly for this purpose and payable only when the estate is settled

10-07-2009, 13:21	#9 (permalink)
JazminesII JazminesII is well actually has found lots of familiar folks ;-)) Spain Guru Join Date: Oct 2008 Location: Costa Cálida (Hot Coast) ;-)) and UK (;- Posts: 1,406 Thanks: 55 Thanked 94 Times in 93 Posts Rep Power: 38	A spanish person told me that many locals ignore this tax.......I'm told if its not paid in 7 years its no longer due.......illegal for sure but evidently an approach locals use.

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