Lucía lives in Valladolid and is the sole heir of her uncle Andrés, who died in Málaga on 14 February 2025 with no children or spouse. She inherited his flat in El Palo and a little over 40,000 euros in the bank. Between the grief, the travelling, the notary and the feeling that "there would be time", she did not file Modelo 650, the Spanish inheritance tax return. Today, at the end of September 2026, the bank will not release the money without proof of the tax, and she realises that the deadline ended more than a year ago.
Lucía's situation is common and can be put right. But it is one of those that cost the most money purely because of the calendar, because in inheritance tax the deadline is long and for that very reason it is let slip entirely. It is worth seeing what she has already lost, what she has not lost and what she still stands to lose if she keeps waiting.
The deadline she had and the extension she can no longer ask for
Law 29/1987 on Inheritance and Gift Tax (the Impuesto sobre Sucesiones y Donaciones, or ISD) and its regulations set six months from the death to file the self-assessment. For Lucía, from 14 February to 14 August 2025. Those six months can be extended by another six, but the extension has to be requested within the first five months. After that point, it is no longer possible.
The extension, moreover, is not free: late-payment interest runs during the extended period. But it is much cheaper than the recargo (the surcharge for filing late unprompted), and it is the tool most wasted in inheritances. How those periods are counted, and the borderline cases, is in deadlines and the extension in ISD.
Which region collects Lucía's inheritance tax
Although Lucía lives in Castilla y León, the tax is not governed by her region but by the region where the deceased was habitually resident. Andrés lived in Málaga, so the Andalusian rules apply and the self-assessment is filed with the Agencia Tributaria de Andalucía, the Andalusian regional tax agency. Filing in the heir's region is a frequent mistake; the full table of which region applies in each case is in the ISD competence table.
Lucía, as a niece, is in kinship group III. The reductions for that group are much smaller than those for children or a spouse, and her inheritance does carry tax. Suppose that, after valuing the flat at its valor de referencia (the official reference value set by the Catastro, the Spanish property cadastre), adding the balance and the household contents, subtracting deductible expenses and applying the Andalusian rules, the tax to pay is 21,400 euros.
What each month of waiting costs her
The recargo in article 27 of the Ley General Tributaria (the General Tax Act) is 1% plus one point for each full month of delay. After twelve months it is 15% plus late-payment interest for the time beyond those twelve months. Every surcharge is reduced by 25% if it is paid on time, unless it is deferred without a guarantee. This is how Lucía's cost looks depending on the day she files:
| If she filed on | Full months since 15-8-2025 | Recargo | With the 25% reduction |
|---|---|---|---|
| 30-10-2025 | 2 | 3% = 642 euros | 481.50 euros |
| 30-4-2026 | 8 | 9% = 1,926 euros | 1,444.50 euros |
| 30-7-2026 | 11 | 12% = 2,568 euros | 1,926 euros |
| 30-9-2026 | 13 | 15% = 3,210 euros | 2,407.50 euros + interest |
Filing on 30 September 2026, Lucía pays the 21,400 euros of tax, the reduced surcharge of 2,407.50 euros and late-payment interest from 15 August 2026, about 46 days: with a rate of around 4%, about 108 euros. In total, about 2,515 euros on top of the tax. From here the surcharge no longer rises in percentage, but the interest keeps running every day.
If your case is like Lucía's, the inheritance and gift form collects the dates, the kinship and the assets, and with that we know what applies to you and how much.
What Lucía has not lost
The first piece of good news is that the delay does not, in principle, take away the reductions she is entitled to by kinship or the others provided by the Andalusian rules: money is lost in surcharge, not the right to the reduction. It has to be checked in the applicable regional rules, because some regions make certain benefits conditional on filing on time, but it is not the general rule.
The second is that, since she has received no letter, she is still in time to avoid a penalty. If the Agencia Tributaria de Andalucía got there first with a formal request, what she would face is an assessment with a penalty under article 191, of 50% to 150% of the tax. Against that, the 15% surcharge is a discount.
As well as inheritance tax, inheriting the flat triggers the plusvalía municipal, the local tax on the increase in land value, payable to Málaga city council. Its deadline for inheritances is six months, extendable by another six if requested within the initial period, and it is governed by each council's bylaw. If the 650 was forgotten, the plusvalía almost certainly was too. They are regularised at the same time, each before its own administration, and how the one on inheritances works is in the plusvalía on inheritances and gifts.
Why the inheritance is stuck until she files
What has made Lucía react is not the surcharge, but the bank. And that is no coincidence. The inheritance tax law makes institutions that hand over a deceased person's money to the heirs without proof that the tax has been paid or filed secondarily liable for it. That is why banks ask for the receipt before releasing balances.
The same happens with the Land Registry: documents transferring assets subject to the tax are not accepted without the stamp showing the return was filed. Until Lucía files the 650, the flat remains in her uncle's name. She cannot sell it, mortgage it or even let it with the peace of mind of appearing as the owner. And the comunidad de propietarios (the owners' association) charges and the IBI (the annual local property tax) will keep arriving in the name of an owner who no longer exists.
The order for getting out of the jam
- Gather the documents: death certificate, certificate of last wills, the will or declaration of heirs, the deed to the flat, the IBI receipt, a certificate of the balance at the date of death.
- Look up the reference value of the flat at the date of death on the Catastro's electronic office. It is the minimum at which it will have to be declared, and declaring below it opens an almost certain review.
- Prepare the 650 with the Agencia Tributaria de Andalucía and pay the tax at the same time, to keep the reduction of the surcharge.
- File the municipal plusvalía as well.
- With the receipt, ask the bank to release the balance and take the deed of acceptance of the inheritance to the Land Registry.
If Lucía does not have the 21,400 euros now, she can ask to defer the tax. But first she should know that deferring without a guarantee makes her lose the 25% reduction of the surcharge. With the bank balance blocked precisely because the tax is unpaid, the practical solution is usually to ask the bank to pay the tax out of the deceased's account, something many banks do at the heirs' request.
All of this is estimated, not guaranteed: the valuation of the flat, the applicable reductions and the final rate depend on the Andalusian rules in force at the date of death and on the documents. What is certain is that the cost of waiting does not go down.
What people ask us about a forgotten Modelo 650
Should I wait and see whether they ask me for the Modelo 650?
No. With Modelo 650, when it is filed late, the recargo in article 27 of the Ley General Tributaria goes up one point for each full month of delay, and after twelve months it becomes 15% plus interest. But that is not the expensive part: the moment a request arrives the recargo disappears and what opens is penalty proceedings. The difference between moving today and waiting for them to move is usually thousands of euros.
Can I ask for more time?
Yes: an extension of another six months, but it has to be requested within the first five. After that point it is no longer possible, and it is one of the deadlines most often let slip.