Spanish Inheritance Tax for Non-Residents: Where to File and What to Review

If you live abroad and have inherited a property or other assets in Spain, you may need to file the Spanish Inheritance Tax return.

One of the first questions is usually where to file it: with the state tax agency or with the autonomous community where the property is located?

The authority that administers the tax and the rules that allow it to be calculated are different questions. Filing the return with the state tax agency does not necessarily mean that only the state rules can be applied.

At MH Legal & Seguros we explain what to check in order to organise the tax position of an international inheritance.

Who pays inheritance tax in Spain as a non-resident

The Spanish Inheritance and Gift Tax Act provides for non-residents to be taxed on the acquisition of assets and rights situated, exercisable or to be performed in Spain.

This may affect, for example, a person who lives in another country and inherits a Spanish property. The review must identify the assets subject to the tax and the acquisition corresponding to each beneficiary.

Knowing the nationality is not enough. The tax residence of the deceased and of each heir at the relevant date must be checked.

Where the inheritance tax return is filed

In cases not transferred to the autonomous communities under the common regime, administration lies with the State Tax Administration Agency (AEAT), usually through the National Tax Management Office.

The AEAT includes among these cases:

• The non-resident heir who receives assets or rights in Spain.
• The heir resident in Spain where the deceased was a non-resident.

The specific connecting factors must be checked and, where applicable, the particular features of the foral regimes and of Ceuta and Melilla.

Do not file the tax with an autonomous community merely because the property is located there.

Can non-residents apply regional rules?

Yes. The AEAT expressly distinguishes between administrative competence and the applicable rules.

In the relevant cases, the regional rules determined by the statutory connecting factors may be applied. This possibility also covers residents of third countries, not only residents of the European Union or the European Economic Area.

It does not allow any autonomous community to be chosen freely: the one corresponding to the file must be identified.

Which connections must be reviewed

As guidance for inheritances within the common regime:

These criteria must be applied to the actual composition of the estate. Where there are properties, accounts or other assets in different autonomous communities, they must be examined together.

How much is paid: why there is no single figure

The tax cannot be calculated from the approximate price of the property alone.

To prepare the return, it is worth reviewing:

• What each beneficiary acquires.
• The taxable value of the assets and rights.
• Charges, debts and deductible expenses.
• The relationship to the deceased and personal circumstances.
• The state or regional rules that apply.
• The requirements for the applicable reductions and reliefs.

The taxable base starts from the net value of each individual acquisition. For properties, the valor de referencia catastral (the cadastral reference value) at the date the tax arises must be checked, together with the rules for declared values above it and for properties without a reference value. It must not be confused with the cadastral value used for IBI (the local property tax).

That is why, before offering an estimate, the documentation and the date of death must be reviewed.

Which documents to prepare for modelo 650

In files administered by the AEAT, modelo 650 is used for acquisitions by inheritance and other succession titles.

The documentation may include:

• Death certificate.
• Spanish certificate of Last Wills and Testaments (Actos de Última Voluntad).
• The will or documentation evidencing the heirs.
• The deed of acceptance of inheritance or, failing that, the inventory and declaration accepted.
• Tax identification of the interested parties.
• Documentation relating to the properties.
• Bank certificates as at the date of death.
• Evidence of debts, expenses and relevant circumstances.
• Documentation of representation, where applicable.

Foreign documents require the conditions of filing, translation and authenticity applicable to the case to be reviewed.

The fact that the deed is not yet prepared does not mean you should wait without reviewing the tax deadline.

Which deadline you need to control

As a general rule, the filing period is six months from the date of death.

An extension of a further six months may be requested within the first five months, subject to the corresponding requirements. The extension carries late-payment interest.

The period does not start when you receive the will, sign the deed or decide to sell the property.

If foreign documentation is missing, it is worth considering as early as possible how to complete the file and whether to request the extension.

Can it be filed from abroad?

The AEAT provides for electronic filing of modelo 650 and its documentation, with the corresponding identification and representation requirements.

This route may allow the return to be filed without travelling to the National Tax Management Office.

Before starting the process, review who will file the return, which powers they need and how notifications will be received.

Do not confuse filing the tax with distributing the estate

Filing the inheritance tax return does not replace the documents needed to evidence the inheritance rights and formalise the acquisition.

Possible municipal obligations, and any that may exist in other countries, must also be reviewed.

To organise the file, it helps to keep one shared calendar covering documentation, taxes, the notary and the Land Registry, identifying which steps can proceed in parallel.

Frequently asked questions about inheritance tax for non-residents

Because I live outside Spain, must I always apply the state rules?

No. The option of applying regional rules according to the statutory connecting factors may exist, even where the AEAT administers the tax.

Can I choose the autonomous community with the lowest tax?

Not freely. The corresponding regional rules must be determined in accordance with the applicable rules.

Do all heirs file with the same authority?

Not necessarily. If their residence circumstances differ, competence must be reviewed for each of them.

Does a relief mean I do not have to file anything?

That should not be assumed. The formal obligations and the requirements of the tax benefit must be checked, even where the amount payable is reduced or nil.

Can I wait until I sell the property to file the tax?

You should not take that for granted. The general period runs from the date of death, regardless of any plans to sell.

Organise the tax position of your Spanish inheritance

An initial review identifies where the tax must be filed, which rules may be used and which documents are missing before the calendar moves on.

At MH Legal & Seguros we advise international clients with inheritances in Spain. We review their circumstances and coordinate the succession documentation and the preparation of the tax obligations with the professionals who need to be involved.

Contact our team to organise the tax position of your inheritance in Spain.