Globalization and the increasing number of citizens who own real estate in different countries make international successions increasingly common.
Inheriting property in Spain as a foreigner raises many questions. Not only do Spanish civil rules come into play, but also European and international law, as well as tax and practical aspects that can complicate the process.
In this article, we provide you with a detailed guide on the legal aspects you need to know if you receive a real estate inheritance in Spain as a non-resident. We will analyze the applicable regulations, the necessary procedures, taxation, and the practical steps required to register the property in your name.
Which law applies to the inheritance of a foreigner in Spain?
The central issue in any international succession is determining which law governs the inheritance. In the case of assets located in Spain, since August 17, 2015, Regulation (EU) 650/2012, known as the European Succession Regulation, applies. This regulation establishes uniform criteria across the European Union (except in Ireland and Denmark).
The general rule (Article 21 of the Regulation) states that the inheritance will be governed by the law of the country where the deceased had their habitual residence at the time of death. This means that even if the deceased was a foreign national, if they were residing in Spain at the time of death, Spanish succession law will determine how their estate is distributed.
For example, a British citizen living in Málaga who dies leaving a house in Spain and bank accounts in Italy, will have their entire inheritance governed by Spanish law, unless they had expressly stated otherwise in a valid will.
Choice of Law (Professio Iuris)
The Regulation offers a very important option: the deceased may expressly choose that the law of their nationality applies to their inheritance (Article 22). This choice must be recorded in a will or testamentary disposition. For example, a German citizen residing in Alicante may establish that German law will govern their succession, thus avoiding the application of the “legítimas” established by the Spanish Civil Code, which reserve part of the estate to descendants or ascendants (forced heirs).
This means that if Spanish law applies, a testator cannot leave all their property to a friend or a specific child, as they must respect the portion reserved for descendants or, in their absence, for ascendants and the spouse. On the other hand, if the law of the deceased’s nationality applies (for example, German law), such restrictions do not exist.
Real estate in Spain: which rules apply?
Although the European Regulation unifies the applicable law of succession, certain matters remain outside its scope. One of these is the property registration regime (Article 1.2, letters k and l of the Regulation). This means that even if the inheritance is distributed under a foreign law, the registration of the property in the Spanish Land Registry must comply with Spanish regulations.
In practice, this means that heirs must execute in Spain a public deed of acceptance and adjudication of inheritance before a Spanish notary, complying with local documentary requirements (sworn translations, apostilles, payment of taxes). Only then can they register the property in their name and legally dispose of it.
Essential steps to inherit property in Spain as a foreigner
a) Gathering the documentation
The following documents are required:
- Death certificate (apostilled and translated if issued abroad).
- Spanish certificate of last wills or, if applicable, proof of no will in Spain.
- Foreign will, if it exists, duly translated and legalized.
- Documentation proving the applicable foreign law, if the succession is governed by a law other than Spanish law.
b) Obtaining the NIE
Every non-resident heir who wishes to register a property in Spain must obtain an NIE (Foreigner Identification Number). This number is requested at the Spanish Consulate or at a Foreigners’ Office and is essential for tax and registry procedures.
c) Deed of acceptance of inheritance
The inheritance must be formally accepted in a public deed before a Spanish notary. Even if a document has already been issued abroad, it must be adapted to Spanish notarial practice. The notary will verify the validity of the will and the applicable law, and may require an expert report on foreign law.
d) Payment of Inheritance Tax
Before registering the property, heirs must file and, if applicable, pay the Inheritance and Gift Tax (Law 29/1987). The deadline is six months from the date of death, extendable for another six months if requested within the first five.
Taxation of inheriting in Spain as a foreigner
Taxation is one of the most sensitive issues for non-resident heirs. The general rule is that they must only pay tax on assets located in Spain (limited tax liability). This includes real estate, bank accounts in Spain, vehicles registered in Spain, among others.
Since 2021, thanks to the case law of the Court of Justice of the European Union, non-residents may apply the same regional reductions and allowances as residents. The applicable regional law will be that of the Autonomous Community where the highest value of the inherited real estate is located.
Differences between Autonomous Communities
- Madrid: 99% allowance for descendants, ascendants, and spouse. An inheritance of €600,000 may result in a tax of less than €1,000.
- Andalusia: €1,000,000 exemption per heir in Groups I and II, which in practice eliminates the tax.
- Valencia: stricter system, with limited reductions and higher tax burden for non-residents.
- Catalonia and the Balearic Islands: intermediate systems, with partial allowances depending on the inherited value and relationship.
Correct application of these allowances is key to minimizing the tax burden, always within the law.
Thus, if you reside in the EU or EEA, you can apply the allowances of the Autonomous Community where the property is located. If you reside outside the EU, the national rules generally apply, which are less favorable, unless regional laws or case law provide otherwise. A non-resident heir only pays tax on assets located in Spain. A resident heir pays tax on their entire worldwide inheritance.
If you are a non-EU resident heir, in addition to paying under national rules in many cases, you will also have to appoint a tax representative in Spain to deal with the Spanish tax authorities.
e) Registration in the Land Registry
Once the tax has been paid, the deed of inheritance is filed along with the tax receipt at the Land Registry corresponding to the location of the property. From that moment, heirs are the full legal owners before third parties.
f) Municipal Plusvalía Tax
In addition to inheritance tax, heirs must also pay the municipal “plusvalía,” which is a local tax on the increase in value of urban land. It must be paid to the local council where the property is located.
The European Certificate of Succession: a key tool
The European Certificate of Succession (ECS), regulated in Articles 62 to 73 of Regulation 650/2012, allows heirs to prove their status in any Member State without additional formalities. It can be requested in Spain before a notary or court and is particularly useful when assets are located in several EU countries. Thanks to this document, an heir can register properties or withdraw funds without initiating succession proceedings in each state.
Practical tips for foreign heirs
- Apply for the NIE as soon as possible to avoid delays.
- Ensure that all foreign documents are apostilled and translated by a sworn translator.
- Plan taxes carefully: review the allowances in the Autonomous Community where the property is located.
- Use the European Certificate of Succession if assets are located in several EU countries.
- Seek specialized legal advice in international successions to avoid costly mistakes.
In summary, inheriting property in Spain as a foreigner involves combining private international law, European succession law, Spanish civil law, and regional tax regulations. Regulation (EU) 650/2012 has simplified the framework, but it is still essential to comply with notarial, registry, and tax procedures in Spain. Proper succession planning and the assistance of a specialized lawyer are the best guarantee to ensure the will of the deceased is respected and that heirs acquire the property without conflicts or tax surprises.