The Spanish inheritance law emphasises the protection of the rights of the deceased’s direct descendents. If you already own, or are seeking to own, a property in Spain, take the time to speak to a lawyer and a qualified financial advisor. This will help you ensure that your assets are in order, and the correct provisions have been made so that your inheritor(s) pass through the process of probate easily.
Here are some of the key points to Spanish Inheritance law:
* There is no automatic inheritance by a wife or other joint owner of the deceased’s joint owners share in any property/asset.
* A spouse’s inheritance is taxable.
* Children are compulsory heirs under the Spanish law of herederos forzosos.
* Only one third of the estate may be disposed of freely, one third must be spread between the children in equal parts and the last third (if property) is subject to an automatic life interest in favour of the spouse.
* Upon his/her death this share is redistributed amongst the children according to the provisions made in the will.
* If the assets inherited include a property then the surviving spouse holds a usufruct over the property and the children cannot dispose of it freely until he/she dies.
* The most important consideration is that under Spanish law, you are not free to dispose of your assets as you like. Certain groups of dependants are protected and have priority rights and if they are not reflected in the Will, then those dependants have the right to challenge.
There is currently confusion as to what may happen in the case of a death of a foreign owner of a Spanish property. Spanish law (Article 9 of the Spanish Civil Code) states that in case of a foreigner’s death (resident or non), the foreigners own country’s law should be applied in order to decide what should happen to their estate. The only legal requirement is that the according inheritance taxes are paid on the assets transferred.
Normally this means the UK Will and Spanish Will (which runs in accordance with it), are used to decide who benefits from the estate. However, if one of your principal inheritors (see below) decides to contest the provisions set out in the Will they will have a right to challenge in the Spanish courts and they will probably win.
Spanish law of succession
If a foreigner dies in Spain without a will, his/her estate will be distributed according to the Spanish laws of succession, and as of yet the law does not recognize childless cohabitating couples. This can have very serious consequences as highlighted by the following scenario:
A partner dies and leaves no Will there are no children and they owned a property in Spain jointly. By law the estate is legally entitled to the parents of the deceased and not the other partner.
The Importance of having a Spanish Will
Let us assume that you have died and the only Will you have in place covering your assets in Spain is the one in your home country. Spanish law will look to your Will from your home contry, but your executors will still need to check with the Spanish Central Wills Registry in Madrid that no Spanish Will exists. The foreign Will is then taken as the main document for deciding probate, subject to the rights of the spouse and children. However, before the authorities accept the Will the executors must translate it through an official translator and provide copies of:
2. Death Certificate
3. Birth Certificate
4. Marriage Certificate
All of the above documents need to be certified for use in Spain by your countries foreign office with a Hague Apostle stamp.
A Spanish lawyer will also have to be appointed in order to prepare a certificate to prove to the authorities that the disposals in the Will are lawful and not in breach of the law. If the Will does not follow the Spanish scheme of dispersals then your direct inheritors (children or wife) can mount a legal action on the assets transferred under Spanish legal system, this could cause your intended beneficiaries considerable loss.
If you died as a non-resident in Spain then the executors should prepare a Power of Attorney to sign the inheritance documents and pay the associated tax for the beneficiaries. Your beneficiaries would need to collect together the money needed for the taxes and send it to Spain.
As you can see the associated processes are expensive & time consuming and the costs and taxes can even start to outweigh proportionally the value of the remaining estate.
What is the Solution?
Make a Spanish Will that runs in accordance and along side your own Will for your assets held in Spain. There are many very good reasons for considering this option. Your executors will be able to avoid a lot of the costs and red tape; you will also be able to make more complex arrangements for the disposal of assets including those not held in Spain. By separating those assets held in Spain under the Spanish Will and those in your home country under your national Will and by making the correct provisions in the latter, risks of inappropriate disposals are minimized and timeframes are greatly reduced.
If you rely solely on the Will from your home country, no action can be taken until the Probate of the estate in your home country has been settled, and with this taking some time your beneficiaries run the risk that the Spanish authorities will impose penalties if the deadlines are missed.
Make sure that if you follow this recommended ‘dual Will scenario’ that your Will doesn’t conflict with the Spanish one and that your lawyer hasn’t left in standard practice clauses such as one’s that revoke all previous Wills.
How to make a Spanish Will
The process for going about and making a separate Spanish Will for your assets is simple. Your Spanish lawyer will listen to your wishes and will advise you as to how the Will should read in order to carry out your intentions. The Will is then made out in two columns; one will be Spanish and the other in your native language. The Will is then checked by the Notary and is signed in his presence and that of three witnesses. This is called an open Will, the notary keeps the original, the lawyer keeps an authorized copy and a notification is sent to the Wills Registry in Madrid. Typical charges are around 300€ plus IVA (VAT) for a couple.