Inheritance tax in Spain

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In Spain inheritance tax is levied on an acquisition due to death and gift tax is levied on a gratuitous gift between the living. The legal basis is the Spanish Inheritance and Gift Tax Act ( Impuesto sobre sucesiones y donaciones ).

Inheritance tax of the state and the autonomous communities

There are 17 autonomous communities in the territory of the Kingdom of Spain . According to Law 22/09 on the regulation of the system of taxes of the autonomous communities ( Ley 22/2009, de 18 de diciembre, por la que se regula el sistema de financiación de las Comunidades Autónomas de régimen común y Ciudades con Estatuto de Autonomía y se modifican determinadas normas tributarias ) the autonomous communities have limited regulatory competence in the area of ​​inheritance and gift taxes.

Therefore, in addition to the “state” inheritance tax law, which is applicable throughout Spain (with the exception of the Basque Country and Navarre), there is also the inheritance tax law of the autonomous communities. However, you only have the right to legislate to a certain extent. So you can z. B. Increase tax allowances or lower tax rates. All autonomous communities have made use of the legislative competence.

However, the law of the autonomous community only applies if

  • the testator had his tax residence in the autonomous community and
  • in addition, the acquirer has his tax residence in Spain.

Otherwise it remains with the sole legislative competence of the state.

Since January 1, 2015, people from the EU or the EEA can also choose the law of certain autonomous communities.

Subject of taxation and tax liability

Inheritance and gift tax relates to every acquisition of objects and rights based on inheritance law as well as gifts. The buyer is liable for tax. The acquisition of goods or rights located in Spain as well as abroad is subject to the tax if the buyer has his habitual residence in Spain (Art. 5 Spanish Inheritance Tax Act). If the acquirer does not reside in Spain, he is subject to tax on all items he has acquired in Spain (Art. 6 Spanish Inheritance Tax Act). Anyone who spends more than 183 days a year there or who has the main focus of their professional or entrepreneurial activity there has a general stay in Spain. In addition to real estate and movable objects there, all rights and claims that must be met in Spain, as well as deposits with banks there (which, according to German law, belong to the place of residence of the account holder) are considered to be located in Spain. Only natural persons are subject to tax liability . Corporations must tax acquisitions due to death or gifts as income subject to corporation tax.

If the purchaser already has movable objects, claims or rights that belonged to the testator up to a year before the inheritance, these are added to the estate value, unless the purchaser can prove that he acquired them from the testator for a fee Has. In the case of advance benefits from land, the same applies with longer periods.

Determination of the tax

The amount of the tax is based on the one hand on a general tariff and on the other hand on a multiplier determined on the basis of personal circumstances that is applied to this tariff. The general tariff increases with the value of the purchase. The multiplier is determined on the one hand in relation to the degree of relationship in which the acquirer is to the testator or donor, and on the other hand according to the amount of assets that the acquirer already has at the time of acquisition. With the so-called previous assets, only assets located in Spain are taken into account. The following four tax classes are formed:

  • Tax class 1: descendants (legitimate or illegitimate) including adopted children under the age of 21
  • Tax class 2: older descendants and spouses, parents, forefathers
  • Tax class 3: Second and third degree relatives (siblings, siblings), ancestors or descendants by marriage
  • Tax class 4: other persons

The general tariff is determined as a progressive partial quantity tariff according to the table below. This means that the tax is calculated separately for each value level and added up until the highest level is reached, from which a fixed percentage also applies.

Inheritance tax Spain basic tariff
Inheritance Tax liability next level applicable percentage of
the excess
0 0 € 7,993.46 7.65%
€ 7,993.46 € 611.50 € 15,980.91 8.5 0 %
€ 15,980.91 € 1,290.43 € 23,968.36 9.35%
€ 23,968.36 € 2,037.26 € 31,955.81 10.2 0 %
€ 31,955.81 € 2,851.98 € 39,943.26 11.05%
€ 39,943.26 € 3,734.59 € 47,930.72 11.9 0 %
€ 47,930.72 € 4,685.10 € 55,918.17 12.75%
€ 55,918.17 € 5,703.50 € 63,905.62 13.6 0 %
€ 63,905.62 € 6,789.79 € 71,893.07 14.45%
€ 71,893.07 € 7,943.98 € 78,880.52 15.3 0 %
€ 78,880.52 € 9,166.06 € 119,757.67 16.15%
€ 119,757.67 € 15,606.22 € 159,634.83 18.7 0 %
€ 159,634.83 € 23,063.25 € 239,389.13 21.25%
€ 239,389.13 € 40,011.04 € 398,777.54 25.5 0 %
€ 398,777.54 € 80,855.08 € 797,555.08 29.75%
€ 797,555.08 , 00€ 199,291 - 34 , 00 %

The multiplier is determined according to the following table, which distinguishes between tax classes and previous assets.

Inheritance tax Spain multiplier
Preliminary assets Tax classes I and II Tax class III Tax class IV
to € 402,678.11 1.00 1.5882 2.0
€ 402,678.12 - € 2,007,380.43 1.05 1.6676 2.1
€ 2,007,380.44 - € 4,020,770.98 1.10 1.7471 2.2
over € 4,020,770.98 1.20 1.7471 2.4

The product of the euro amount resulting from the table for the basic tariff and the multiplier results in the tax liability.

Allowances

The following allowances are granted for inheritance tax:

  • Tax class I: € 15,956.87; for each year before the 21st birthday, increase by € 3,990.72, maximum tax allowance € 47,858.59
  • Tax class II: € 15,956.87
  • .Tax class III: € 7,993.46
  • Tax class IV: none

Disabled people also have a special allowance of between € 47,858.59 and € 150,253.03, depending on the degree of disability.

Spouses and descendants have an additional allowance of € 9,195.49 for payments from life insurance.

The "home" (e.g. house or condominium) used by the testator himself as his main residence (i.e. not a holiday home) is 95% tax-free up to a maximum amount of € 120,202.42,

  • if the acquirer (heir, legatee) is a person in tax class I or II and
  • if the buyer keeps the home ten years after the purchase (i.e. not sold).

In order to facilitate the transfer of a business, an exemption of 95% of the value of the business or a participation can be granted both in the case of acquisition due to death and in the case of gifts, if the transfer takes place to spouses or descendants. In the case of gifts, the transferor must have reached the age of 65 or be unable to work, and the recipient must take on management functions and operate the company for ten years, see Art. 20, Paragraph 6, Spanish Inheritance Tax Act.

Procedure and statute of limitations

The taxpayer must declare himself / herself within 6 months after the inheritance, whereby the normal case is the self- assessment, i. H. the taxpayer must calculate the tax himself, declare it and pay it (to a paying agent, e.g. a bank). Persons with limited tax liability can also apply for the tax to be assessed by official channels, but must then provide the information required for the assessment within the same period. The deadline can be extended to a total of 12 months upon request, which must be submitted within 5 months after the acquisition (usually death).

The Spanish inheritance tax expires in accordance with Art. 25 Para. 1 Spanish Inheritance Tax Act in conjunction with 66 let. a) u. b) Ley General Tributaria- LGT- (Spanish tax code ) in four years. According to Art. 67, 1 et seq. LGT, the limitation period begins on the day following the day on which the deadline for submitting the tax return or self-assessment ( declaration deadline) or the deadline for tax payment ends.

If the succession is tied to the validity of foreign documents (i.e. those issued outside of Spanish territory), the limitation period in accordance with Article 25 (2) of the Spanish Inheritance Tax Act (inserted in 2003) begins with the submission of the tax return or self-assessment; therefore only when the tax authorities themselves have knowledge of their own rights (publicity), which they only lose after four years if they fail to act (inactivity). However, this provision is not exceptional, as Art. 48 I Reglemento del Impuesto sobre Sucesiones y Donaciones -RISD- (Spanish ErbStDV ) contains the corresponding idea for all inheritance cases ; thereafter, the limitation period begins only after the self-assessment or tax return. The idea of ​​publicity continues for the general case of donations (from - to Spaniards in Spain) in Art. 48 II RISD for donations that are only registered with public (and on the territory of Spain) registration within the meaning of Art. 1227 Codigo Civil -CC - (Spanish Civil Code ) gain legal force. Various decisions by the Tribunal Supremo, the Supreme Court of Spain, also provide information that substantive tax obligations are not overridden by the expiry of deadlines due to possible administrative neglect.

Changes by the regions

Abolition of inheritance tax through trivialization

As explained in the introduction, the autonomous communities have to a certain extent their own legislative power, which they have made extensive use of. B. granted increased allowances and simplified the requirements for tax exemptions for companies. Many autonomous communities have also effectively abolished the tax for groups 1 and 2 (parents, children, spouses, partners in unmarried partnerships). Since a complete abolition by the communities is technically not possible, the tax has been trivialized in many ways by introducing allowances of 99.0 and even 99.9% of the value of the estate.

Autonomous communities with 99% tax exemptions

So far, inheritance tax within families (groups 1 and 2) has been effectively abolished in the following communities:

In 2013, the Comunidad Valenciana reduced the exemption from 99% to 75%.

The Autonomous Community of the Canary Islands abolished the tax exemption in tax classes 1 and 2 in June 2012.

The same applies to the Autonomous Community of Castile-Leon .

Other communities, such as B. Andalusia , do not grant a 99% tax exemption, but increased allowances.

The law of the autonomous community only applies if

  • the testator had his tax residence in the autonomous community and
  • in addition, the acquirer has his tax residence in Spain.

Since January 1, 2015, people from the EU or the European Economic Area can also choose the law of certain autonomous communities.

Compatibility with European law

The European Court of Justice (ECJ) ruled on September 3, 2013 that the Spanish regulations on the taxation of non-residents with inheritance tax violate the free movement of capital , as foreigners typically do not enjoy the benefits of the autonomous communities. Anyone who has paid Spanish inheritance tax in the past can now, under certain circumstances, request a refund.

Double taxation

As the inheritance tax liability under Spanish and German law can overlap, double taxation is possible. Spain has only concluded double taxation agreements in inheritance tax matters with France , Greece and Sweden , Switzerland and Austria not. An agreement was signed with Germany for the first time in 1966, which was updated in 2011.

However, under certain conditions, the Spanish inheritance tax can be offset against the German inheritance tax.

If the testator was subject to unlimited taxation in Germany (residents), the inheritance tax paid on accounts and custody accounts cannot be offset against the German inheritance tax.

The European Court of Justice holds the current state of Community law but such double taxation is inevitable, as far as the legal developments within the European Union is not yet sufficiently advanced.

Capital gains tax on inheritance of land

Due to the law on a municipal capital appreciation tax on land in built-up areas ( Impuesto Municipal sobre el Incremento del valor de los Terrenos de Naturaleza Urbana ), the municipalities can tax the appreciation of land in the event of a change of ownership. Such taxation is also carried out in the event of inheritance. The municipalities determine the amount of the tax, also known as Plusvalia for short in Spain . However, in Art. 108 the law limits taxation by setting upper limits for an increase in value to be taken into account, staggered according to the number of inhabitants of the communes and according to the period within which the increase in value occurred. The underlying increase in value is limited to increases of 2.7% to 3.7%, of which 16% to 30% can be levied as capital gains tax, whereby the permissible percentages depend on the size of the municipality.

See also

Individual evidence

  1. ↑ Ley 29/1987 of December 18, 1987, Noticias Juridicas, loaded January 12, 2010, Impuesto sobre sucesiones y donaciones (Spanish)
  2. ↑ Quoted from José Martínez Salinas: Spanish inheritance tax - introduction .
  3. ↑ Quoted from José Martínez Salinas: Spanish inheritance tax: Reform eliminates discrimination against non-residents .
  4. ↑ Article 9 of the Spanish Income Tax Act
  5. ↑ Art. 21 Spanish Inheritance Tax Act
  6. ↑ Art. 22 Spanish Inheritance Tax Act
  7. ↑ Art. 20 para. 2 c) Spanish Inheritance Tax Act
  8. ^ Portal of the Tribunal Supremo (Spanish) ( Memento of September 2, 2011 in the Internet Archive )
  9. ↑ Judgment 1688/2000 v. November 6, 2000, ruling 44/2003 v. April 3, 2003 and Judgment 751/2003 v. November 28, 2003
  10. ^ Inheritance tax for the Autonomous Region of the Balearic Islands
  11. ↑ Quoted from José Martínez Salinas: Modification of the inheritance tax of the autonomous community of Valencia .
  12. ^ Canaries: Reform of the regulations of the autonomous region on inheritance tax
  13. ↑ Castile and Leon: Cancellation of the 99% discount on tax liability for children. ( Memento from September 27, 2013 in the Internet Archive )
  14. ^ Inheritance tax Autonomous Region of Andalusia
  15. ↑ Quoted from José Martínez Salinas: Spanish inheritance tax: Reform eliminates discrimination against non-residents .
  16. ↑ Case C-127/12
  17. ↑ Quoted from José Martínez Salinas: Reclaiming the Spanish inheritance tax as a result of the judgment of the ECJ .
  18. ↑ admin: Agreement between the Federal Republic of Germany and the Kingdom of Spain to avoid double taxation and to prevent tax reductions in the field of taxes on income and property - Federal Ministry of Finance - Topics. Retrieved May 26, 2020 .
  19. ↑ Quoted from Jan-Hendrik Frank: Crediting Spanish inheritance tax in Germany .
  20. ↑ Quoted from BFG: BUNDESFINANZHOF judgment of June 19, 2013, II R 10/12 .
  21. ↑ ECJ judgment of February 12, 2009, Block, C-67/08
  22. ↑ Plusvalia - the municipal capital gains tax

literature

  • Jan-Hendrik Frank: Internationales inheritance law - Spain , 2nd edition 2014, CH Beck Verlag, Munich, ISBN 978-3-406-66422-9
  • Burckhardt Löber - Erhard Huzel: Inheritance law in Spain , in: Rembert Süß (Ed.): Inheritance law in Europe , 2nd edition 2008, zerb Verlag, Angelbachtal, ISBN 978-3-935079-57-0 , pp. 1409-1482
  • Wolfgang Sohst (translator): The Spanish law on the taxation of non-residents and Spanish inheritance tax law , print or CD-ROM, 7th edition 2011, xenomoi-Verlag Berlin, ISBN 978-3-942106-07-8 or -08- 5