Stepmother died 3 years ago but still on villa deeds. Tax implication? Fine?

Not sure if this is a problem or not. No doubt is is! 

My father, and his two children (me being one) and his deceased wife are on the deeds to our Spanish villa. We all live in the Uk.

She died 3 years ago and without a UK will so all her assets went to my father by default....but nothing was done about her share of the property in Spain.

My father now wishes to give his share of the property to us (his children) in the most tax efficient way, but of course we still have a deceased owner.

Could this be expensive to rectify or does my stepmothers share just automatically become my fathers as it would in the UK?

Appreciate any guidance. 

Thanks

I can't give you any advice, but I think you will find the rules regarding inheritance different in Spain. If there was no UK will, there probably was no Spanish will, so the spouse doesn't inherit everything.

"Spanish Succession Laws stipulate that both descendants (children or grandchildren) and ascendants (parents or grandparents) will inherit with priority over a surviving spouse. They are entitled, by law, to inherit fixed shares of the estate."

Source: https://www.spanishpropertyinsight.com/2015/01/08/spanish-wills-probate-law-light-european-regulation/

I believe there is also a inheritance tax to pay for all those that inherit too. I'm sure someone more knowledgeable will come along soon.

Mark

In Spain if one does not pay a tax etc. (and no attempt has been made to inform you of it)  within four years then the authorities cannot demand payment.                                    

I understand that Spaniards often ‘forget’ to notify a death until that time has passed.

I asked  at Blackstone Franks seminar once how a poor Spanish widow could pay inheritance taxes,  plus valir etc .  that was what they said,

On that point thouth maybe you should take some informal advice.to ensure that still applies.

Useful reading:-      https://www.spanishpropertyinsight.com/2016/02/08/spanish-inheritance-tax/

Thank you for your replies. 

There was no Spanish will unfortunately. 

I understand the Sucession Laws but as my stepmother had no children and her parents and grandparents are dead then would her share then go to her husband?... or would it go to her nieces and nephews etc 

Interesting about the 4 year rule, I will investigate. Thanks 

Arambol:

Where is the property located?

South coast, Casares.....between Marbella and Gibraltar.

Your dad needs to do the Spanish part of the ab intestate probate ( and pays corresponding tax if 4 years have not elapsed since the time of death), then, he can gift the property to you. Gift tax would apply.

Andalucia tax residents have a threshold of one million euros free of ISD taxes from January 2018.

Thank you Maria, 

She died in 2013 so 4 years have passed. What is the scenario after 4 years? Nothing to pay? 

He still needs to remome her from the Escitura before he can gift the vila I presume.

Arambol:

Yes, nothing to pay after 4 years. 

Yes, he needs to do the Spanish part of the probate to have her removed from Escritura and Land Registry

Am I reading this correctly? When I or my partner dies, If we want to avoid paying Inheritance tax on our property in Spain all we need to do is not notify the Spanish authorities until 4 years have lapsed, and one of us will have saved thousands of euros in taxes......

Jarvi the simple answwr is yes

But if you get discovered then there will fines which mean you are takiing a risk not to declare

Thanks John. Looks to me like a risk worth taking. Hopefully it wont be for may years to come yet.

Just another thought on this one. Someone dies, their relatives "forget" to inform the authorities for 4 years, then they don't pay any inheritance tax. How would they then manage to pay non-resident taxes for someone who is deceased, surely the authorities would realise if they had continued paying the non-resident taxes that they were intending to deceive the state?

I pay the 210 tax direct from my bank account on a couple of apartments my son owns.  There is no apparent obligation to say he is alive !

Good point John.