If you have inherited assets in Spain, you will no doubt be feeling somewhat daunted by the task that lies ahead in claiming them, if indeed you want to.
In Spain, inheritance is a right rather than an obligation, and in many cases beneficiaries of estates decide not to accept what has been left to them. This is usually because the debts on the estate exceed the value of it. In rejecting an inheritance, it automatically falls to the next in line to inherit.
There is always much to do when administering an estate, regardless of which country you are in or which laws apply. It can be particularly challenging if you are not based locally, and so you may wish, if you do decide to accept your inheritance, to instruct Spanish probate solicitors to handle the estate for you.
Giambrone Law is an international, award winning law firm with offices in numerous countries, including the UK and Spain. We have a team of specialist Spanish probate solicitors at your disposal, all of whom speak fluent English and are natively aware of the laws and cultural aspects that apply across the different regions of Spain. Our experts will be able to advise you as to the value of the estate early on, so that you can make an informed decision as to whether to accept your inheritance. This is valuable guidance to have at the start, as it may be that you decide to reject it, all things considered.
The following information has been put together to assist you in understanding how the Spanish probate system works, but of course we are available on a one-to-one basis to answer your individual questions.
What are the main differences between Spanish probate law and UK probate law?
Spanish probate law is very different to that in the UK in numerous ways. Firstly, Spanish wills do not usually appoint an executor. Instead, as a beneficiary you would be required to appear before a Spanish notary to state whether you accept the inheritance. Secondly, as already stated, in Spain you have a choice as to whether you accept an inheritance, it is a right rather than an obligation.
If you are unable to appear in person before the Notary, then you can appoint a power of attorney to do so on your behalf, which would usually be the Spanish probate solicitor managing the estate.
Another difference is that if the estate involves land or property, then a ‘deed of acceptance’ will need to be prepared, and this will need to be executed in front of a Spanish Notary.
I’ve inherited assets from a non-Spanish resident, will the rules differ?
A new law that took effect on 1 January 2015 changed things considerably. Previously, if you inherited assets from a non-Spanish resident, the State Rules would apply concerning inheritance tax, no matter where the assets were based in Spain. This contradicted the law applying to Spanish residents, who were able to take advantage of the beneficial tax allowances allocated by the various autonomous communities. This was considered discriminatory however, and the new EU law now means that beneficiaries of non-resident EU citizens with assets in Spain can enjoy the same tax allowances as Spanish nationals.
What is involved in the Spanish probate process?
The Spanish probate process can be summarised into nine main steps:
Step 1: Documents and information
The process starts with a pulling together of all the necessary documentation. You will need originals of the death certificate and the will; the title deeds for any property; a receipt for the most recent property rates payment; bank account numbers; valuations; the NIEs (fiscal number certificates) of the deceased and date of death statements together with any applicable UK Grant of Probate. If there was no will, then you should be prepared with proof of your relationship to the deceased, such as a birth or marriage certificate. You will also need your own NIE (see below).
Step 2: Power of Attorney
The Spanish probate procedure involves a great deal of personal attendance, which is obviously going to be difficult if you are not based in Spain. It is therefore useful to appoint a power of attorney to act in person on your behalf, and this will usually be your Spanish probate solicitor. If you are unable to get to Spain to sign a power of attorney then your solicitor will be able to arrange for the power of attorney to be signed in the UK.
Step 3: Obtaining a NIE
A ‘Número de Identificación de Extranjero’ or ‘NIE’ as it is commonly known, is a fiscal identification number. Anyone who owns assets in Spain requires one, and you will need one if you are to accept an inheritance. A good Spanish probate solicitor will have a streamlined process in place to enable you to obtain a NIE swiftly, usually without visiting Spain.
Step 4: Searching the Central Wills Registry
In Spain, most wills are lodged with the Central Wills Registry in Madrid. It is a requirement to make a search of the registry to ascertain the existence or absence of a Spanish will. If evidence exists of a will but you are unable to locate a copy, you will be able to obtain one from the Notary’s office that registered it.
Step 5: Legal Certification and Official Translations
If there are any documents that are required as evidence of entitlement to your inheritance, and they are in English, such as Grants of Probate, death certificates, birth certificates, marriage certificates, etc., then these will usually need to be legalised by the Foreign and Commonwealth Office so that they can be used as legal admission in Spain. In some cases they will also need to be translated and certified by an official translator.
Step 6: Execution of Inheritance Deed
Spanish inheritance tax must be paid within six months of the date of death so as to avoid interest and penalties. The tax cannot be paid until the notarial process is completed, nor any property cannot be registered in the name of the beneficiary, so it is essential that the official deed of declaration of inheritance is signed by the Notary without delay. A proficient Spanish probate solicitor will proactively push this forward.
Step 7: Tax Payment
Once the Inheritance Deed is signed, it is time to pay the taxes due. You should already have been provided with a list of cost and taxes due, so that you are prepared to make the required payments. We have provided further details about the costs involved in Spanish probate later in this article.
Step 8: Dealing with the Bank
It is well known for this stage of the Spanish probate process to take the longest. The takeover of a bank account is dealt with by the bank’s central legal department, and communication can be slow. An experienced Spanish solicitor with established contacts will help to move the process along a little more swiftly, although you should not expect it to happen overnight.
Step 9: Registry Applications
Once the Spanish inheritance tax has been paid, you are free to apply to the land registry and / or vehicle registry to transfer the title of any assets into your name.
How long does the Spanish probate process take?
There is no set answer to this question, as it very much depends on the contents of the will if there is one and if there is not one, then the process will take longer. If the will was made outside of Spain then further delays will ensue, and the entire process depends on the succession law applied. If you are looking to make the Spanish probate process as simplistic and swift as possible for your beneficiaries, then you should without doubt make a Spanish will, as this vastly reduces the complexity and extent of the documentation that needs to be presented to the Spanish authorities.
What are the costs involved in Spanish probate?
It is important to be prepared for the costs involved in Spanish probate, including the inheritance tax payable, so that you are ready to make the payments when required and so that the process is not delayed.
You will need to account for Notary fees in the UK and in Spain; the cost for setting up a power of attorney; translation costs; obtaining certificates, for example from the Central Registry of Wills; your NIE application; property registry fees; inheritance tax filing fees; Spanish inheritance tax; ‘Plusvalia’ – a municipal tax levied by the local Town Hall on the increase in the value of urban land on change of ownership; legal fees; courier charges; bank transfer fees and disbursements.
With regard legal fees, you should always make sure that your quote is all-inclusive and incorporates an itemised list of all of the above, so that you are not met with a surprise bill at the end. Respected Spanish law firms will always clearly set out the full list of fees and explain any potential additional costs.
Will I have to pay taxes, and how much will they be?
Aside from the taxes and costs mentioned above, Spanish inheritance tax, or ‘Impuesto sobre Sucesiones y Donaciones’ (ISD), must be paid by the beneficiary of any inherited assets that were located in Spain, as well as by resident Spanish beneficiaries.
The rates of tax are connected with the value of the inherited assets; the relationship between the giver and the recipient prior to the transfer and the region in which the assets were situated.
A more in-depth explanation of ISD, the applicable rates, regional allowances and how to minimise it is available in our dedicated Spanish inheritance tax guide.
What happens if there was no will?
If someone has died without leaving a will, either in Spain or in the UK, then the intestate rules of the country of the deceased’s domicile or residency will apply.
If assets are left in Spain, then the beneficiary will be required to obtain a ‘declaration of heirs’ if the heir is the spouse of the deceased, or a descendant or ascendant, in which case this can be obtained from a Notary. If the heir is another relative or not a relative at all, then a court order will be required.
Do I need to use two different solicitors to deal with the UK and Spanish assets?
It is unusual for a UK wills solicitor to be competent in Spanish probate law, unless they are specifically experienced in cross-border probate. If you are able to find a solicitor with offices in both the UK and in Spain, who can proficiently represent you in both countries, and who speaks both your language and the local dialect applicable to the region of Spain in which the deceased’s assets were based, then you will not need to engage two solicitors.
Do I have to be in Spain to deal with the Spanish probate process?
There is no need for you to be present in Spain in order to deal with the Spanish probate procedures as you can appoint a power of attorney to act on your behalf. This will usually be a role undertaken by your Spanish probate solicitor. The power of attorney can be arranged before a Notary in the UK.
Glossary of Spanish Probate Terms
The following are some of the most commonly referred to terms when dealing with Spanish probate, and their corresponding meanings:
Residence: A Spanish resident is defined as an individual who spends more than 183 days per calendar year in Spain; who intends to reside there; who has his centre of vital interests based there or, unless otherwise proven, his spouse lives in Spain and he is not legally separated.
Domicile: You are generally domiciled in the country that is your permanent home, and therefore you can only ever have one domicile. This is a legal status that has an effect on taxes.
Nationality: This is usually defined by the country in which an individual was born, although nationality can be changed. A passport will usually stipulate the nationality of its holder, but it is possible to have dual nationality.
Principle of unity of succession: This means that an estate is probated in the location that the deceased was last domiciled, and that country’s laws will apply to the entire estate. So if an estate is dealt with in the UK, there is no need for intervention on the part of the Spanish authorities, even if there are assets in Spain.
Matrimonial regime: Unless otherwise agreed, shared matrimonial assets will be deemed ‘assets in common’, which means that all property and rights acquired are jointly owned. There is also a ‘separation of assets’ regime which provides that each spouse owns the property acquired before they were married as well as any property acquired during the course of the marriage.
Plusvalia: A municipal tax levied by Spanish town halls on the increase in value of urban land when a change of ownership occurs. The rate varies depending on the local population size as well as the length of ownership and it will be payable on transfer of title.
Giambrone Spanish Probate Solicitors: Advice you can rely on, from English Speaking Experts
Giambrone Law has offices in Spain and in the UK, and offers exceptional experience in cross border probate, regularly acting for beneficiaries in both countries and in doing so saving on both time and costs. If you would like to talk to us about assisting you with administering an estate in Spain and have questions on Spanish probate to be answered, you are very welcome to get in touch.