A non-resident who acquires assets and rights by inheritance in Spain is taxed under the Inheritance and Gift Tax (ISD) by real obligation, that is, only for the assets and rights located, or that can be exercised in Spanish territory.
1) Applicable regulations and competent Administration
- Generally, when the acquirer (heir) is a non-resident, the management of the tax corresponds to the State Administration (AEAT).
- However, the applicable regulations can be from:
- The State, or
- The Autonomous Community (the ones corresponding to the Autonomous Community where the assets are located in Spain), when the legally provided requirements are met.
In inheritances with real estate, the usual connection point for determining the autonomous community regulations is the location of the property.
2) Self-assessment deadline
- The general deadline for submitting the ISD self-assessment is 6 months from the date of death.
- It is possible to request an extension (usually for another 6 months), if requested within the legal deadline.
3) Real estate in Spain: additional taxes and charges
If real estate located in Spain is included in the inheritance, in addition to the ISD, it is advisable to consider:
- IIVTNU (municipal capital gains tax): This is accrued by the mortis causa transfer and is administered with the corresponding City Council.
- IBI and other property expenses: after the adjudication/acceptance, the following are relevant:
- IBI,
- Community expenses
- Utilities or other recurring charges, to the extent of which they begin to affect the allocated owner from the regularization of ownership and the ordinary management of the property.
At PLANA VENTURA GARCÉS we offer you specialized advice on inheritance law, providing answers, among many others, to the issues and questions that may arise in any type of inheritance.
