The deadlines, which come first
| Situation | Deadline | Form |
|---|---|---|
| Inheritance | Six months from the death | 650 |
| Extension of that period | A further six months, applied for inside the first five | Application |
| Lifetime gift | Thirty working days from the deed | 651 |
| Municipal land tax on an inherited property | Six months, extendable to twelve | Each town hall |
It has to be requested inside the first five months. After that it can no longer be obtained, and from the sixth month surcharges and interest start to run. Ask for it whenever the paperwork is not going to be ready comfortably: it costs nothing and it does not oblige you to use it.
Before calculating anything: which regional rules apply
The question that decides what is payable is not how much you are receiving. It is which set of rules applies to your case. Between one Spanish region and another, the same estate can cost a hundred euros or forty thousand, because the reliefs and the rebates are each region's own.
Inheritance and gift tax is a national tax — Law 29/1987 — that has been ceded to the autonomous regions. Law 22/2009 allocates two different things, and mixing them up is the commonest source of error:
- Which administration is competent, meaning where the return is filed and who reviews it. That may be a region, or it may be the national government through its central tax management office.
- Which set of rules is applied, meaning the reliefs and rebates used to calculate the bill.
The two do not always coincide. There are cases where the return is filed with the national administration but regional rules are applied to it, and that gap is precisely where money is lost through not knowing.
The five-year rule
Where the connecting factor is somebody's residence — the deceased's, the recipient's — it is not enough to look at where they were registered on the day. Regional residence is determined by the territory in which that person spent the greater number of days of the five years immediately preceding, counted date to date and ending the day before the tax falls due.
Moving to a better-taxed region three months before dying changes nothing. And the reverse: somebody who moved abroad two years ago may still be treated, for this purpose, as resident in the region they left.
Inheritances: the full picture
The tax falls due on the date of death. From there:
| Deceased | Heir | Competent administration | Rules that may be applied |
|---|---|---|---|
| Resident in Spain | Resident in Spain | The region where the deceased habitually lived | That region's |
| Resident in Spain | Non-resident | The national administration | Those of the region where the deceased lived |
| Non-resident | Resident in Spain | The national administration | Those of the region holding the greatest value of the Spanish assets; if there are none, the heir's own region |
| Non-resident | Non-resident | The national administration | Those of the region holding the greatest value of the Spanish assets |
For years every non-resident was assessed under the national rules, which are the worst of all because they carry none of the regional reliefs. That changed with the judgment of the Court of Justice of the European Union of 3 September 2014 and the Spanish Supreme Court case law that followed, and Law 11/2021 extended it to residents of third countries as well. Today a non-resident files with the national administration but applies the regional rules that correspond to the case.
If somebody paid as a non-resident under national rules and four years have not passed, a claim for rectification and refund is still possible. It produces some of the largest refunds seen in this tax.
Gifts: the class of asset governs
On lifetime gifts the connecting factor changes according to what is given. A flat and a bank transfer are not treated alike.
| What is given | Recipient | Competent administration | Rules that may be applied |
|---|---|---|---|
| Property in Spain | Resident | The region where the property is | That region's |
| Property in Spain | Non-resident | The national administration | Those of the region where the property is |
| Property outside Spain | Resident | The national administration | Those of the recipient's region |
| Money and other assets | Resident | The recipient's region | That region's |
| Money and other assets located in Spain | Non-resident | The national administration | Those of the region where those assets were located for the greater number of days of the preceding five years |
Gifting money from abroad
That last row generates more questions than any other and is the one most often got wrong. Where parents living outside Spain give money to a child who also lives outside Spain, the applicable rules are those of the region in which the money — not the people — has been located for the greater number of days over the previous five years.
In practice that means the region where the branch of the institution holding the funds is. If an account has been held in Seville for the last five years, Andalusian rules apply, even if nobody in the family has set foot in Andalusia.
And the practical consequence follows: before money is moved, it is worth looking at where it has been. Transferring it to another account the day before the gift does nothing to the five-year count, whereas opening an account in the right region well in advance can. This is planning, not engineering: it is done beforehand and it is documented.
If one region's rules are applied and the criterion cannot then be proved — the days of presence, where the assets were, where the deceased lived — the administration will assess on the basis it considers correct, with interest and, where it finds fault, with a penalty. Bank statements, registration certificates and land registry extracts are kept from the outset.
Family relationship changes everything
| Group | Who | Treatment |
|---|---|---|
| I | Children and descendants under 21 | The largest reliefs |
| II | Children and descendants of 21 or over, spouse, parents and ascendants | High reliefs and, in several regions, an almost total rebate |
| III | Brothers and sisters, nephews and nieces, uncles and aunts, and relatives by marriage | Small reliefs plus a multiplying coefficient |
| IV | Cousins and unrelated persons | No relationship relief and the highest coefficient |
The step from group II to group III causes the most distress: an estate passing between brothers and sisters can cost ten times what the same estate costs passing from parents to children. Unmarried partners are a particular trap, because whether they are treated as a spouse depends on the region and usually on being formally registered as a couple.
Your case, in two minutes
Your inheritance or gift: your map of obligations
The form for this service asks only what matters here. At the end you have your map of obligations, the deadlines running against you and a fixed price.
What has to be gathered
- Death certificate and the certificate of last wills, which says whether a Spanish will exists.
- An authorised copy of the will or, where there is none, the formal declaration of heirs.
- Deeds to the properties and the IBI receipts, which carry the cadastral reference.
- Certificates of account balances and of securities at the date of death.
- Life assurance policies and their certificates.
- Deductible debts and expenses: the outstanding mortgage, funeral costs.
- A Spanish tax number for any heir who does not have one, which takes time to obtain and should be started immediately.
If something is missing, we obtain it. What does not work is waiting until everything is in hand before looking at the calendar.
What we do with this
- We fix the connecting factor and document it. It comes first, because everything else follows from it. Where there is room for interpretation, we say so and explain the risk.
- We build and value the inventory, using the cadastral reference value for property and balance certificates at the date of death for accounts.
- We compare the applicable regional rules with the national ones where the case allows it, so that the choice is calculated rather than assumed.
- We apply for the extension inside the first five months if the paperwork will not arrive in time.
- We file the 650 or the 651 where it belongs and leave you the receipt and the complete file, in case there is a review years later.
And after the tax
Settling the tax does not finish the job. Title still has to be changed at the Land Registry and at the cadastre, the change notified to the owners' association of the building and to the town hall for council rates, and the property's tax position brought up to date: if it is let, income tax or form 210 appears; if it stands empty and the heirs live abroad, imputed income does.
Where there are assets outside Spain, two further things appear: the credit for tax paid in the other country, and form 720 the following year, which almost nobody connects with an inheritance and which is the one that causes the trouble.
Questions we are asked about your inheritance or gift
How long does an estate take? With the documentation in hand and no dispute between heirs, it can be settled in a few weeks. The legal deadline is six months from the death.
I live outside Spain and have inherited here. Can I apply the regional rules? Yes. The discrimination between residents and non-residents was corrected, and in many cases there are refunds outstanding for years that are still open.
What if I cannot pay the tax? A deferral or instalment arrangement can be applied for, and in some cases there are special rules. What does not work is letting the deadline pass.
What do you charge? A fixed quote before we start, based on the assets and the number of heirs. It is not part of any monthly fee.