INHERITING FOREIGN ASSETS AS A SPANISH RESIDENT: DO NOT FORGET YOUR TAXES!

If you are a foreign national residing in Spain – meaning you are a tax resident here – and you have inherited money or assets from abroad, there is a crucial step you cannot overlook: declaring these inheritances to the Spanish tax authorities.

It is a common area of confusion, but failing to declare can lead to significant problems with Hacienda (the Spanish Tax Agency).

Why declaration is crucial (even if tax-exempt)?

You might be wondering: “How exactly do I do that?” That is where we come in. We specialise in guiding Spanish residents through the process of declaring foreign inheritances.

Here is a key point: In many cases, the payment of inheritance tax on these foreign assets might be exempt for Spanish residents, especially given regional tax allowances (like those in Andalusia).

However, even if the tax payment is exempt, the obligation to declare the inheritance still exists. This declaration is vital for several reasons:

• Avoid bank account blocks: failure to declare could lead to Spanish banks freezing your accounts if they detect a large, unexplained incoming sum.
• Prevent issues with annual income reviews: the Spanish tax authorities review your annual income. An undeclared increase in your assets from an inheritance could raise red flags and lead to uncomfortable questions.

How we can help you declare your foreign inheritance

To get started, we will need specific documentation from the inheritance in your home country. This usually includes papers clearly stating the amount you have received or are due to receive, and details about the person from whom you inherited it.

Important Timeline: Generally, you have six months from the date of death to declare the inheritance in Spain. However, it is possible to apply for an extension for another six months.

Once we have the necessary documents, we will:

• Prepare the corresponding explanatory documentation.
• Accurately calculate and file the relevant inheritance tax declaration (even if the resulting tax payable is zero).

DO NOT RISK IT – AVOID ISSUES WITH HACIENDA!

Navigating international inheritance rules and tax obligations can be complex. Do not take chances that could lead to penalties or legal issues down the line. Let us help you ensure everything is handled correctly and efficiently.

Contact us today to declare your foreign inheritance and gain peace of mind!