Do you own property in Spain?
If you own or are planning to purchase a property in Spain it is vital that you also make a Spanish will, registered with the Spanish Registrar of Wills in Madrid. This simple straightforward procedure will avoid unnecessary costs and upset for your heirs at a difficult time. You should also periodically review your Spanish Will to ensure that it reflects your current financial and personal circumstances.
How do I make a Spanish Will?
First you must decide how you wish to divide your estate. A foreigner making a Spanish Will is not obliged to follow the Ley de Herederos Forzosos (Law of Obligatory Heirs) and you can choose to distribute your assets as you wish. Greenfields Law will then discus your plans and ensure that you are fully compliant with the laws and every step has been taken to minimize your inheritance tax. We then present the will to the Notary who formally records your Will keeping the original in his office and filing a copy with the Spanish Registrar of Wills. You will receive a ‘Copia Simple’ of your Spanish Will that you can keep for your records.
Inheritance Tax Planning
In Spain it is those that inherit who are taxed not the estate of the deceased. Therefore surviving spouses are liable for inheritance tax in Spain even if a property is held in joint names. Inheritance Planning from Greenfields Law can avoid costly and unexpected bills for your heirs. Spanish inheritance law is very complex and there are a range of solutions available according to the personal circumstances – we offer Free Consultations for those concerned about Inheritance Tax planning – apply here for an appointment.
Types of Spanish Will
Rules relating to witnessing of Wills in Spain are very strict and you should ensure that any document is properly valid before filing with the Notary.
An Open Will (Testamento Abierto)
This is the most common type of will. Greenfields Law will prepare the document and present it to the Notary for approval. The contents must be known to the Notary and the three witnesses required.
A Closed Will (Testamento Cerrado)
In this case the contents of the will remain secret. Closed Spanish Wills must be drawn up by a Spanish lawyer. The Will is presented to the Notary who seals it in an envelope and signs along with two witnesses. It is then filed and recorded in the same way as an Open Will.
A Holographic Will (Testamento Ológrafo)
This is a Spanish will that is prepared orally or in your own handwriting. A written holographic will must be clearly signed and dated. No witnesses are required but on your death the document is presented before a judge who will decide the validity of the execution. An oral will must be made in the presence of five witnesses who must then testify before the notary as to the wishes of the deceased. The Notary then prepares a written will and certifies it with the Central Register of Wills on Madrid.
- Do I need an Executor?
Executors are unusual in Spain and, if you decide to appoint one, it could increase the inheritance tax payable. Also, if you appoint an executor you should inform your heirs so that they will know to inform them in the event of your death. If you appoint a lawyer as your executor, he’s permitted to charge a maximum of five percent of the estate’s value. Your beneficiaries must produce an original death certificate or a notarized copy of a foreign certificate if you die outside Spain.
- When is Inheritance Tax due in Spain?
Inheritance Tax in Spain must be paid within six months of the death. It is possible to request for further six months’ extension although interest will be charged. Inheritance Tax must be paid before of the release of the deceased’s assets in Spain. In some cases therefore, beneficiaries may require substantial funds to pay the tax before they receive their inheritance.
- Where should I keep my will?
Keep a copy of your will(s) in a safe place and another copy with Greenfields Law or your chosen executor. Do not leave your Spanish Will in a bank safe deposit box, which in the event of your death is sealed for a period under Spanish law.
- How does marriage affect my Spanish Will?
Unlike some other countries, in Spain marriage doesn’t automatically revoke a will. Spanish inheritance law is a complex subject and it’s important to obtain professional legal advice from Greenfields Law before writing or altering your Spanish Will.
- What is the Law of Obligatory Heirs?
Under Spanish law, any surviving spouse retains all assets acquired before marriage, half the assets acquired during the marriage and all personal gifts or inheritance which have come directly to the surviving spouse. Any remaining assets will be disposed of under the Law of obligatory Heirs, Ley de Herederos Forzosos, which is as follows. When a person dies in Spain, leaving children, their estate is divided into three equal parts:
- 33% – must be left to any surviving children in equal parts
- 33% – must also be left to the children, but the deceased decides how it is to be divided.
- 33% – can be freely disposed of
If the deceased has no children, then surviving parents of the deceased have a statutory right to 33% of the estate if they have a surviving spouse, or 50% of the estate if they do not have a surviving spouse.