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Spanish & UK Wills

It is absolutely vital when drawing up either a UK or a Spanish Will that the content of the former does not revoke the latter.

When considering your wishes upon death to avoid potential problems you must have a UK Will which does not include a clause such as "my assets where so ever located" as this most certainly will revoke any Spanish Will. In other words the UK Will should only deal with UK territorial assets. A Spanish Will is desirable to deal with assets located in Spain.

Difficulties often arise because Spanish laws recognise, for example in the case of a British national, UK law is applied in order to decide what happens to the estate on death. A UK Will is accepted as valid in Spain, however UK law states in the situation of fixed assets (property is obviously immovable) it is the local Spanish law that decides what happens on death.

Unlike UK law where an individual is free to dispose of his estate as he chooses, Spain has something called "forced heir ship" which is in common with most European countries. This means close blood relatives cannot be denied. For example where a husband dies leaving a widow and children he can only dispose of a third of his estate freely, of the other two thirds one third must pass immediately to his children equally, a second third gives a life time interest to the wife with provision upon her death for the children to inherit this third also.

If someone dies without making a Will (intestate) then regardless of the persons nationality Spanish law applies to Spanish located assets.

As a concession Spain allows foreigners to dispose of their Spanish located assets by a Spanish Will in accordance with the laws of the foreigner’s own country.

If you only possess a UK Will it can be a very costly process to have it proved in Spain, and there can be lengthy delays involved.

Inheritance in Spain does not usually require the appointment of an Executor in the Will as the legacies pass directly to the beneficiaries. It is possible however if you wish to appoint an Administrator of the estate, who is known as an "El Albacea" in Spanish. This individual could be a relative or friend provided they know something about Spanish legal procedure, as an alternative a professional adviser can take on the role. It is fundamental to understand, as with your UK assets, upon death probate has to be applied for.

So it is with your Spanish assets, procedures need to be followed for payment of the taxes and the transfer of assets legally to new owners including those between husband and wife.

When a husband and wife own a house in Spain they do so as tenants in common and not jointly and severally as is often the case in the UK. In other words the husband and the wife own 50% each so if one dies it is legally required to transfer the deceased's share into the name of the surviving spouse if this was the intent in the Will.

Taxation of estates is dealt with very differently in Spain to the UK and is much closer to the Republic of Ireland model in that tax is paid by the recipients and not by the estate.

In Spain and Ireland beneficiaries are taxed on the value of the legacy and whereas in Ireland thresholds are extremely generous, in Spain they are very low. A note of caution however Spain’s provinces have autonomy over inheritance tax when it is applied to their official tax residents and each province has its own rules and requirements.  Advice should be sought.

Spanish equivalent of inheritance tax is calculated on an ascending scale according to the recipient's relationship with the Testator. Lowest application of the tax is wife and any children rising to those without family connection and at this level it is possible to be taxed at 85% of the legacy.

Careful consideration of estate matters now will save difficulties at a later date for those empowered to sort out your affairs.

  We are qualified in British and International Tax and Estate Planning. We are associated with Lawyers, Accountants and Financial Advisers in the UK, Europe and Offshore.

To get peace of mind is priceless and the potential financial savings are immeasurable.

The first step is to call us on (00 34) 922 390851

We travel throughout the UK, Ireland, Spain, Balearic and Canary Islands.      

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