April 11th, 2014
Spanish tax law can
undoubtedly lead to very unfortunate fiscal consequences in the event of
inheritance by beneficiaries who are unrelated to the deceased- including
unmarried / same sex partners, particularly if the relationship is not
‘recognised’ with civil status.
So, the bad news is
that advisers who warn of the exposure to Spanish Succession Tax rate of 80%
(or even slightly more) are confirming what could theoretically happen.
However, it should be
stressed that such a high rate of taxation would only apply in the very worst
Spanish tax case scenario. For example, with a very high value Spanish estate;
already wealthy beneficiaries; and no family or marriage connection between the
deceased and the beneficiaries.
But in any event, even
with Spanish estates of more modest value, the impact of Spanish Succession Tax
can still be unexpectedly harsh. So, it’s clear that planning is essential in
all family situations involving Spanish property ownership, to prevent the risk
of legally avoidable Spanish tax liability arising.
Advising non-Spanish
owners of Spanish properties is complex and specialised area of Spanish legal
practice, and without the correct advice, major Spanish tax problems can easily
arise.
We are happy to talk
through any potential cases (without obligation). Together we can explore the
solutions that are available to achieve succession wishes, in a tax efficient
manner.
