Inheritance tax and subsequent tax liability if I sell and take money back to uk or reinvest in Spain

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10 Oct 2012 15:25 by Destiny villas Star rating. 5 posts Send private message

Apologies for the long winded title. I will shortly (sadly) be inheriting(along with a sibling) a property in Spain. My mother has done everything"properly" but won't really discuss it with us. My concerns are what it will cost my brother and I just to keep it as is. Should we decide to sell and bring money home is there a further tax and if we sell and buy 2 properties is the tax liability lessened? My brother and I do not get on so the simplest solution that I can present to him will hopefully be best.I have no idea what the property is worth but I would guess between 200-250k and is un encumbered. Any advice would be gratefully accepted



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11 Oct 2012 08:59 by johnzx Star rating in Spain. 5247 posts Send private message

When one inherits in Spain, say a property or part of one, they must pay the tax due before they can take possession and sell the asset.

 

For non-resident inheritors the tax free allowance is I believe around 17,000 euros per person, after that there is a sliding scale of tax liability, which also involves calculations based on the assets already owned (anywhere) by the inheritor.  The rules also vary between autonomous regions.

 

Contrary to the advice I would normally give, I suggest you consult a legal professional, as it is I believe a potential minefield.

PS My mother has done everything"properly" but won't really discuss it with us.   

I don't know how you can be certain of this. I would suggest that you find out now what has been done, who has done it and confirm that is is all in order.  Otherwise it will be you paying the bills (and arguing with your sibling)  to get it sorted.





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11 Oct 2012 10:09 by Destiny villas Star rating. 5 posts Send private message

Hi Johnzx, Thanks so much for the info, scary though it was! thats a big lump were going to have to find, im sure my mum didnt ever think leaving us the place would be so expensive. I will of course take legal advice when the time comes. Do you know of another way we could have gone about it? I dont want to burden my kids  in the same way later on! Thanks again for your help mate.





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11 Oct 2012 10:20 by johnzx Star rating in Spain. 5247 posts Send private message

I would suggest you speak to a professionally qualified person. 

I am sure one can take steps to mitigate taxes, but I cannot advise as I am resident and my wife, also resident, will inherit the bulk of my 'fortune' hahahaha. 

Thus I have some idea of that scenario in relation to the Region where we live.
 





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11 Oct 2012 10:22 by norm de plume Star rating in North Tenerife and L.... 162 posts Send private message

Try and hold out as long as possible before doing anything.  The discrimination against non-resident property owners on Inheritance Tax should be rectified in the near future.  Spain has been told to get its house in order.





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11 Oct 2012 10:25 by johnzx Star rating in Spain. 5247 posts Send private message

Try and hold out as long as possible before doing anything.


I understand that taxes due on inheritance must be paid within six months of the death (open to correction),
 





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11 Oct 2012 10:30 by norm de plume Star rating in North Tenerife and L.... 162 posts Send private message

If the worst comes to the worst, any new law is likely to be retrospective (leading to another growth industry in claims firms).





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