Expats and property owners in Spain - No plan for Spanish Inheritance Tax (ISD)?

January 2012: No apologies for telling you as it is! The irony about ISD is that since careful planning can avoid most of the tax, it is actually a ‘Voluntary Tax’

I recommend that you take advantage of a FREE proposal which will tell you the extent of any liability you might have. It commits you to nothing but does put you in the picture.

• Spanish Inheritance Tax (ISD) is NOT the same as UK IHT

• A widow’s sad story

• Why didn’t your lawyer tell you?

This tax is totally different from UK IHT, in fact so different that it is not covered by any Double Tax Treaty between UK and Spain. This article covers anybody who has assets in Spain whether they are resident or non-resident in Spain.

I suspect that it affects everyone who reads this Blog and each of you know many, many people who are also trapped by its implications. Perhaps you could pass it on to friends and neighbours?

But there are solutions

A letter from a Widow

Mrs Holt wrote to me, about a sudden demand for €8,800 plus other costs to transfer ownership into her name following the tragic early and unexpected death of her husband. For a modest second home in Alicante Province, transferring their holiday home will cost more than €10,000. In addition to the ISD there are the Notary costs, land register charge and her own solicitor’s costs.

‘The property I assumed would be signed over to myself, however, after asking our solicitor in Spain to confirm the costs they have included an 8,800 euro inheritance tax.’ She told me. ‘At his time of death we were both working and living full time in the UK and hold residence of the UK.’ She added.

Mr & Mrs Holt bought their dream home in 2002 but the solicitor who handled their purchase never mentioned Spanish ISD. I’m not sure why but they never seem to.

As if coping with a tragic death is not enough, there is a highly significant tax as well!

Yet there are UK solutions which are using the advantage of EU treaties, yet complying with Spanish Law. Rather than tell you more here, I suggest that you look at your own situation and get a free quotation based individually on your own circumstances.

Please click on the section 'Check YOUR Spanish Inheritance Tax liability' in the right hand column.

As always, you can also contact me by sending an email

David Goodall

Financial Pages in Spain

davidgoodall.spain@gmail.com

PS If you’d rather pay this ‘voluntary tax’ – do nothing!