Law in Spain

...And opens the floodgates to thousands of claims for refunds of Spanish Inheritance Tax paid during the last four years.

The European Court of Justice ruled in September last year that Spain have been acting illegally by charging non-resident beneficiaries more inheritance tax (IHT) on their estate than a Spanish Resident would have been charged. It was ruled that their behavior was contrary to the EU’s non-discrimination treaty provisions.

From 1st January 2015, the government has introduced new style forms to allow non- residents to complete their IHT returns and apply the exemptions that were formerly only available to residents, ensuring that they are no longer discriminated against with much higher tax bills.

This is good news for those people who are submitting returns from now on, as they will no longer be discriminated against. But what about all those people who through discrimination paid too much money in the past?
There could be good news for them as well... If they paid non-resident Spanish Inheritance Tax within the last four years and were resident in the EU (but not in Spain) and inherited from a direct family descendent or spouse who were also resident in the EU (but not in Spain), then they will be able to claim a refund.

The amount refunded will vary depending on which region’s tax rules governed the original payment but in some cases it can be up to 100% of the tax paid. In the new regulation of this tax, the Spanish government has fixed the applicable law to each case. The downside is that the process for making the claim is quite complicated and should only be carried out by trusted professionals as there are various deadlines which need to be met.

So don’t delay! Contact us here at Abad Abogados where we will be happy to review your individual case and inform you if you are eligible to make a claim. This applies to anyone in the EU and not just those of you in the UK.
For those of you that paid non-resident Spanish Inheritance Tax more than four years ago, you can still attempt to get a refund as well, but it would need to be a different action through the courts which could be a more costly process, requiring barristers and incurring court fees. Let us review your individual case and consider if a claim made through the courts would be advisable.

To discuss your situation and to answer any further questions you may have about inheritance in Spain please contact us on www.abadabogados.com.