1. Inheritance Tax Deductions
In Andalucía

2. This presentation has been updated and is valid for 2017.*
*Advocate Abroad does not accept responsibility for losses of any type consequent upon reliance on the
information contained in this presentation. Please consult a lawyer before acting.
Inheritance Law in Andalucia
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3. In 2001 the Spanish government devolved the power to set
inheritance tax rates and deductions to the regional
parliaments.
Inheritance Law in Andalucia
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4. Most regions enacted tax laws that applied generous
deductions only to those beneficiaries who were resident in
the region over the balance of the previous five years.
Inheritance Law in Andalucia
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5. On September 3rd 2014, the European Court of Justice ruled
that such laws were discriminatory and contrary to European
Law.
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Inheritance Law in Andalucia

6. Accordingly, the Spanish government has enacted new
legislation (Ley 26/2014) which makes any deductions that
may be applied to residents also available to non-residents
who are EU citizens.
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Inheritance Law in Andalucia

7. The main impact of the new legislation is as follows:
1) If the deceased was a non-resident, living in another
European country then the beneficiary may apply those
deductions and exemptions provided by the regional
government in which the majority of the inherited assets
are located.
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Inheritance Law in Andalucia

8. 2) If none of the assets to be inherited are located in Spain,
then the resident beneficiaries should apply the legislation
enacted by the regional government where they are normally
resident.
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Inheritance Law in Andalucia

9. 3) If the deceased was resident in one of the Spanish regions
and the beneficiaries were non-resident, and living in another
European Union country, then they may apply those
deductions and exemptions available to residents of the
region in which the deceased was resident.
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Inheritance Law in Andalucia

10. The regional level exemptions available in Andalucía were
enacted by the Seville parliament and in their current form
are specified in Legislative Decree1/2009.
The most important changes to state succession laws may
be summarised as follows:
Inheritance Tax Law in Andalucía
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11. Spanish Inheritance law first assigns beneficiaries to groups
according to the degree of kinship with the deceased:
Group I Children, including adopted children, under the age of 21
Group II All other descendants, spouses and parents
Group III Close relatives such as brothers and sisters, grandparents,
aunts and uncles
Group IV More distant relatives
Personal Deductions
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12. Those couples who are unmarried may benefit from the
same deductions as spouses if they are registered in the
relevant registry in Andalucía.
Personal Deductions for Common Law Couples
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13. The following are the personal exemptions available in
Andalucía:
Group Deduction
Group I A 100% exemption where the inheritance is valued at
less than €250,000 and the pre-existing wealth of the
beneficiary is less than €402,678.11
Group II A 100% exemption where the inheritance is valued at
less than €250,000 and the pre-existing wealth of the
beneficiary is less than €402,678.11
Group III State Level Deduction only: €7.993
Group IV No deductions available
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14. Personal exemptions cntd:
Where the total inheritance is above 250,000 € and equal to
or below 350,000 €, the deduction available under this rule
shall be reduced to 200,000 €
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15. If the beneficiary is disabled > 33%:
There is an exemption of 100% for an inheritance where
the taxable value of the inheritance is less than or equal to
€250,000 (for inheritances after June 2010)
If the beneficiary is in Group III or IV then their pre-existing
wealth should not be more than €402,678
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16. Inheritance of the Family Home:
Where the beneficiary is the spouse, child or parent of
the deceased, and ownership of the home is maintained
for 3 years, the following deductions apply:
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17. 17
Real Net Value of the Property Limit per Beneficiary % Reduction
Up to 123,000 € 100%
From 123,001 € to 152,000 € 99%
From 152,001 € to 182,000 € 98%
From 182,001 € to 212,000 € 97%
From 212,001 € to 242,000 € 96%
Over 242,001 € 95%
Inheritance of the Family Home Cntd...

18. Inheritance of the Family Home Cntd...
• Elderly relatives who were living with the deceased for
a period of two years prior to the death may also
benefit
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19. Deductions in transfer of Family Business
● Tax deduction of 99% of the value of the business
● May be children, spouse or any relative 'to third
degree of sanguinity' who may benefit from the
deduction
● Must maintain business for a period of no less than 5
years
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20. Other Deductions:
As a general rule the following deductions may be made on
any estate:
● Funeral Expenses
● Final Medical Expenses of the Deceased
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21. Other Deductions Cntd:
● Debts held be the deceased that are evidenced by public
documents e.g. a mortgage
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22. Once the final amount of tax payable is determined then it is
necessary to apply the relevant rate:
Tax Rates in Andalucía
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23. Tax Rates in Andalucía
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Taxable
Sum
Tax Payable On
This Sum
Any Remainder Up
To
Applicable Rate on
Remainder (%)
0 0 7993,46 7,65
7993,46 611,5 7987,45 8,5
15980,91 1290,43 7987,45 9,35
23968,36 2037,26 7987,45 10,2
31955,81 2851,98 7987,45 11,05
39943,26 3734,59 7987,46 11,9
47930,72 4685,1 7987,45 12,75
55918,17 5703,5 7987,45 13,6

24. Tax Rates in Andalucía
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Taxable
Sum
Tax Payable On
This Sum
Any Remainder Up
To
Applicable Rate on
Remainder (%)
63905,62 6789,79 7987,45 14,45
71893,07 7943,98 7987,45 15,3
79880,52 9166,06 39877,15 16,15
119757,67 15606,22 39877,16 18,7
159634,83 23063,25 79754,3 21,25
239389,13 40011,04 159388,41 25,5
398777,54 80655,08 398777,54 31,75
797555,08 199291,4 And Above 36,50

25. Existing Wealth
Once the relevant tax rate has been applied the result is
multiplied by a coefficient determined by the existing wealth of
the beneficiary as well as the group to which they belong:
Existing Wealth Groups
(In Euros) I & II III IV
0 to 390,657 1 1.5882 2
390,657 to 1,965,309 1.05 1.6676 2.1
1,965,309 to 3,936,629 1.1 1.7471 2.2
More than 3,936,629 1.2 1.9059 2.4
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26. Existing Wealth
The Groups referred to consist of the following beneficiaries:
Group I Children, including adopted children, under the age of 21
Group II All other descendants, spouses and parents
Group III Close relatives such as brothers and sisters, grandparents,
aunts and uncles
Group IV More distant relatives
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27. Each year in Spain thousands of expats pay more
tax on inheritance than they should – simply
because they fail to follow some simple rules.
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28. To find out how to get expert advice, in English, about how to
reduce your liability for inheritance tax, go to:
Expert Probate Services in Andalucia
Expert Probate Services in Andalucia
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