Inheritance Taxes

Pay less in taxes on inheritances

Our specialist lawyers make the best calculation

DO YOU KNOW WHAT TAXES YOU HAVE TO PAY?

On acquired assets other than real estate, companies, shares, investment funds, etc…

Our specialist inheritance lawyers will tell you what other taxes need to be paid and help you with your tax obligations for the next few years. It is important to be familiar with all the obligations arising from an inheritance so as to avoid any unwelcome surprises and penalties.

When you acquire real estate, you need to pay the municipal capital gains tax, which is different in each municipality. This is a tax that is paid based on the increase in value that the land on which the property is located has undergone.

It is important to seek the guidance of specialist inheritance lawyers, as there are now multiple bonuses available that can give rise to tax savings. Moreover, the Constitutional Court has ruled that this tax is not generated in the event of a loss.

In particular, in the event that you consider transferring a property through a sale or other legal transaction in the future, it is important to conduct a study on the value of the property and the applicable tax repercussions, as the value declared in the inheritance will affect the future calculation of the capital gains generated as a result of the future transfer.

Call us and our inheritance lawyers will provide you with guidance and calculate the payment of taxes, carrying out all the procedures in order to minimise the payment thereof, thereby ensuring they are in line with reality.

The inheritance and donations tax is the main tax to be paid. This tax is different in each community. To this end, our specialist lawyers will be entrusted with calculating how much you should pay. Furthermore, this tax varies in accordance with the degree of kinship.* See the kinship table

This tax should be calculated correctly, knowing which bonuses apply in each case and finding a payment method suited to your pocket.

Inheritance tax and donations:

https://www.boe.es/buscar/act.php?id=BOE-A-1987-28141

SAVE TAXES BY PLANNING YOUR INHERITANCE

WE HAVE SOLUTIONS FOR…

Lack of funds to pay taxes

It may happen that you receive an inheritance made up of multiple real estate assets of a high economic value, but at the same time, you do not receive any money in current accounts to enable you to pay the respective taxes, which delays the acceptance of the inheritance.

Payment in installments and deferrals

If you need to settle inheritance taxes but have insufficient funds, our inheritance lawyers will help you find the best solution for your situation, processing deferrals and payment in installments.

Fines and penalties imposed by the Tax Administration

If you receive a fine or penalty from the tax administration, get in touch with our specialist inheritance lawyers and they will study the penalty in order to carry out the pertinent procedures in defence of your interests.

Learn about the 2017 Constitutional Court ruling on Municipal Capital Gains and how it affects you when paying the tax.

Why should I seek guidance in order to settle inheritance taxes?

Why should I seek guidance in order to settle inheritance taxes?

When you receive an inheritance you need to calculate and pay the respective taxes. It is important to know how much, when and how to pay them. Our specialist inheritance lawyers will calculate these taxes for you.

Many people calculate the payment of taxes incorrectly, meaning that they either pay more or are penalised by the tax administration, which results in greater and unnecessary disbursements or disproportionate penalties.

It is important to seek the guidance of specialist inheritance lawyers; an early second opinion can prevent subsequent unforeseen costs incurred by the heir due to an initial error.

Finally, it is important to find a tax payment method adapted to your situation, as you may receive a large number of assets and lack the necessary funds to pay all the taxes immediately, reason for which experts should be hired to find a solution adapted to your economic means.

FREQUENTLY ASKED QUESTIONS ON INHERITANCE TAXES

The usual taxes in the processing of inheritance are Inheritance Tax, Municipal Capital Gains Tax and Personal Income Tax.

The Inheritance and Donations Tax is a progressive tax that depends on multiple variables, in such a way that the tax rates increase the greater the value of the assets received in the inheritance. In turn, the rate may differ in accordance with your family relationship with the deceased and your previous assets.

Therefore, the applicable tax rate will be different for each inheritance and there is no single, general rate applicable to every inheritance.

All assets, as well as charges and debts with an economic value received in an inheritance must be taken into consideration in tax obligations.

The most common assets to bear in mind all real estate, bank balances and products, vehicles and personal property of extraordinary value, such as jewellery and art collections. On the contrary, the most common charges will usually be loans taken out with financial institutions or mortgage charges.

There are multiple bonuses and exemptions associated with the payment of Inheritance Tax and Municipal Capital Gains Tax that can give rise to significant tax savings.
The most important one is the bonus applicable to the habitual residence, which allows for a reduction of up to 95% of the value thereof with a limit of €500,000 in Inheritance Tax, although there are many others.

As such, before settling these taxes it is important to seek advice from a specialist in order to prevent the loss of any bonus or exemption due to a lack of knowledge, thereby obtaining the maximum savings in tax matters when accepting the inheritance.

The voluntary period in which to settle Inheritance Tax and Municipal Capital Gains Tax is six months, extendable for an additional 6 months.

Moreover, the income tax return for the year in which the deceased died must be submitted in a complementary manner in cases where it is necessary.

In order to be able to settle the Inheritance Tax, you will normally need the inheritance inventory, which is usually contained in the deed for the acceptance and distribution of the inheritance.

This inventory will usually contain a record of all the information required to settle inheritance taxes.

The payment deadline is usually 30 days from the date on which the tax is settled and once the payment letters have been obtained, always in compliance with the maximum voluntary settlement periods.

Inheritance Tax, Inheritance and Donations Tax and Municipal Capital Gains Tax can be settled within a period of 6 months, extendable for a further 6 months.

The estate in some inheritance processes may comprise assets that are difficult to convert into cash, such as real estate, meaning there are insufficient funds to pay the respective taxes.

In these cases, it is possible to request the payment of the inheritance tax in installments or to defer it and pay it once a property has been sold.

The best way to minimise the tax burden on an inheritance is for the living testator to conduct a succession study, to evaluate the tax burden on the heirs and make a will pursuant to the tax study to ensure the biggest savings, distributed in accordance with the will.

In addition, when receiving the inheritance, you should always seek advice to evaluate the options available for accepting the inheritance, thereby obtaining the biggest tax savings.

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