Are you single with no direct descendants and own your home mortgage free in Spain?
Do you want a friend, partner or family member to live in the property when you have passed on?
Surely there is no issue with Spanish succession tax?
Well you would be wrong.
If you own a property worth say €2.5 million your beneficiary would have to pay tax in excess of €800,000 to inherit your home. Unlike the UK where the estate of the deceased pays inheritance tax, in Spain it is the recipient who is liable for the tax. There are no allowances to set against the tax bill, indeed if the recipient is wealthy in their own right the tax could increase to 82% in the worst case scenario.
Even inheriting a more modest property worth say €500,000 could result in a tax bill of €130,000 and even if you were a relative of the deceased you would only receive a very modest allowance against the tax liability.
Fortunately there are some ways to mitigate the drastic impact that this tax might have.
To find out how you could save your intended beneficiaries from this nightmare contact Fiduciary Wealth’s financial advisors Spain on +350 200 50982 or email wealth@fiduciarywealth.gi
