Inheritance Tax - resident married couple

[audreytoms]

We have been resident in Spain for over 3 years, are both in our late 50s and intend to stay here for the rest of our lives (hopefully a very long time). We have no children, the house is in our joint names, and both our spanish wills leave everything to each other. We keep hearing different stories about what we will pay in inheritiance tax as the wife / husband of the deceased. Please can you clarify what would be taxed and offer any guidance as to ways of ensuring we wouldn´t pay any more inheritance tax than we absolutely have to? Thank you in advance.

[Professional Lawyer]

We have been resident in Spain for over 3 years, are both in our late 50s and intend to stay here for the rest of our lives (hopefully a very long time). We have no children, the house is in our joint names, and both our spanish wills leave everything to each other. We keep hearing different stories about what we will pay in inheritiance tax as the wife / husband of the deceased. Please can you clarify what would be taxed and offer any guidance as to ways of ensuring we wouldn´t pay any more inheritance tax than we absolutely have to? Thank you in advance.

Sorry for the delay, I did an answer for this yesterday but it didnt appear, so I must have not completed the post properly. Firstly, I am going to assume that you reside in the Valencian region (Torrevieja is within this). If one of you died, the other is liable to pay inheritance tax on the assets of the other, but a 99% exemption on their share of the main home may be available if you have been on the Padron for 5 years and making tax returns in Spain for 5 years. In Spain there is no automatic right of assets passing between spouses on death. Inheritance tax is paid by the beneficiary and is calculated on the base value of the assets owned by the deceased. There is an exempt allowance of almost 16,000 euros for a spouse. Once the second of you has passed away the inheritance tax payable by the beneficiary then will depend on their relationship with the deceased (there is no tax free allowance for friends for example). If you would like to come and see us now we can give you an approximate calculation for the inheritance tax payable at the moment if something happened. Of course this could change in the future. My advice would be to ensure that you are both on the Padron and are fiscal Residents.