Spanish Inheritance Tax!
If you are a Spanish Tax resident or deemed a Spanish Tax Resident, or are non-resident but own property or assets in Spain, your spouse/beneficiary could be liable to Spanish Inheritance Tax upon your death.
This tax is known in Spain as Impuesto De Sucesiones or ISD for short. Each region of Spain has different rates and allowances. However, the Valencian region currently has some of the highest rates of Inheritance Tax in Spain.
Depending on the size of your wealth, ISD tax may apply to married couples on the death of the first spouse and the tax has to be paid within 6 months of the date of death. All joint assets in Spain are frozen on death, this includes Spanish bank accounts. If you are tax resident in Spain, all your worldwide assets wherever they may be located, are included in the calculation.
If you are deemed a UK Domicile (different from UK Resident) but live in Spain, this can also mean UK Inheritance Tax is payable by your estate (spouse to spouse is exempt in the UK).
Spanish Inheritance Tax (ISD) and UK inheritance tax (IHT) are very complex subjects, unravel the mysteries and find out how it could affect you, your family, and/or heirs and what, if possible, can be done to reduce or mitigate it.
Article by Andrew Gibson
Blacktower Financial Managment Ltd
The above information was correct at the time of preparation and does not constitute financial advice and you should seek advice from a professional adviser before embarking on any financial planning activity.
Blacktower Financial Management Ltd is authorised and regulated in the UK by the Financial Conduct Authority and is registered with both the DGS and CNMV. Blacktower Financial Management (Int) Ltd is licensed in Gibraltar by the Financial Services Commission (FSC) and is registered with both the DGS and CNMV in Spain.