When is an heir considered a non-resident in Spain
Tax residence is the first thing to clarify, because it determines how the inheritance will be taxed. As a general rule, a person is a Spanish tax resident if they spend more than 183 days in Spanish territory during the calendar year, or if Spain is the main centre of their economic activities or interests. Anyone who does not meet those criteria is treated, for tax purposes, as a non-resident.
A few practical examples:
- A Spaniard who has been living and working in London for years and only visits Spain occasionally: non-resident.
- A French citizen who owns a flat in Madrid and spends two months a year there: non-resident.
- A German who inherits a commercial unit in Barcelona but lives in Munich: non-resident.
If you are unsure about your tax residence, it is worth reviewing in detail, because the residence certificate issued by your home tax authority plays a key role in the rest of the procedure.
What regulations apply to Inheritance Tax
This is one of the points that raises the most questions in cross-border inheritances.
The Spanish Inheritance and Gift Tax (ISD) is a state tax, but it has been transferred to the Autonomous Communities, which can set their own reductions and allowances. Historically, non-resident heirs could only apply the state regulations, which in many cases meant a much heavier tax bill than that paid by a resident heir in an equivalent situation.
Generally, after the relevant case-law evolution, non-resident heirs may apply the Autonomous Community regulations that correspond to their case instead of the state regulations. The CJEU judgment of 3 September 2014 (case C-127/12) and the subsequent doctrine of the Spanish Supreme Court in 2018 opened that possibility, first for EU/EEA residents and later also for residents outside the European Union.
In practice, the differences between state and regional regulations can be very significant, so each case should be reviewed individually. The same inheritance can result in a substantially reduced tax bill or a significantly higher one depending on which Autonomous Community applies.
How the applicable Autonomous Community is determined
If the deceased was a Spanish resident
The regulations of the Autonomous Community where the deceased had their habitual residence during the five years before death apply. For example, if the deceased lived in Valencia, Valencian regulations apply, even if the heir lives in the United Kingdom.
If the deceased was a non-resident
The regulations of the Autonomous Community where the highest-value asset of the estate is located apply, typically a property. For example, if the deceased lived in France but owned a flat in Madrid, the regulations of the Madrid region apply.
It is common to see clients assume that, “as a non-resident, the state regulations always apply by default”. In most cases that is no longer the situation.
What happens if the inheritance includes a property in Spain
The most common case is an inheritance that includes a home, a commercial unit or a plot of land in Spain. The administration involves several practical steps:
- Property valuation. Since 2022, the so-called reference value set by the Cadastre often replaces the declared market value as the minimum taxable base. It is worth checking it on the Cadastre website before filing.
- Land Registry extract (nota simple). An up-to-date extract from the Land Registry is essential to evidence ownership and possible charges (mortgages, attachments, easements).
- Registration in the heir's name. Once the inheritance has been accepted and the tax has been paid, the change of ownership is registered at the Land Registry, together with the deed of acceptance.
If the heir keeps the property and remains a non-resident, in subsequent years they will need to file Form 210 annually for imputed income (if the property is empty) or for rental income (if it is let). It is a recurring obligation that should be planned for from the outset.
Other taxes and costs that may arise in an inheritance
Many heirs only think of Inheritance Tax and are then surprised by additional costs. It is best to have the full picture from the start:
- Plusvalía municipal (Spanish municipal capital gains tax on the increase in the value of urban land). If the inheritance includes urban property, the city council where the property is located may charge this local tax, with its own deadlines and allowances. It does not depend on the Autonomous Community: it is strictly local.
- Subsequent NRIT (Form 210). If the heir keeps the property and does not reside in Spain, they will need to declare imputed income or rental income annually. More detail in our non-resident services page.
- Notary and registry fees. The deed of acceptance of the inheritance before a notary, plus the subsequent registration at the Land Registry, involves additional costs that depend on the value of the assets.
These costs add to Inheritance Tax and should be factored into the overall budget when planning the estate administration.
Deadlines and obligations for a non-resident heir
The general filing deadline for Inheritance Tax is 6 months from the date of death. It can be extended for another 6 months, provided that the extension request is filed within the first 5 months of the initial period.
Forms to file:
- Form 650: self-assessment of Inheritance Tax.
- Form 660: recapitulative declaration of the estate (list of the deceased's assets and rights).
The competent authority is the relevant Autonomous Community or, in some cases, the National Tax Management Office (ONGT) of the Spanish Tax Agency.
If filed late without prior request, Law 11/2021 set a progressive surcharge system: 1% plus an additional 1% per full month of delay, up to 12 months. Beyond 12 months, the surcharge rises to 15% plus late-payment interest.
If the heir does not yet have a NIE (Spanish foreign tax identification number), it must be obtained before filing anything. It can be requested from abroad through the Spanish consulate or, alternatively, through a power of attorney granted to a representative in Spain (a tax adviser, lawyer or gestor) who applies for the NIE on the heir's behalf.
International double taxation
One of the most common questions is: “if I pay Inheritance Tax in Spain, do I have to pay again in my country of residence?”. The answer depends on the bilateral framework.
Spain has signed bilateral treaties to avoid double taxation on inheritances with a limited group of countries, including France, Sweden and Greece. If the heir resides in any of those countries, the treaty sets rules to allocate taxing rights between both States and avoid paying twice.
Where there is no specific treaty, the Spanish Inheritance and Gift Tax Act allows a unilateral deduction for tax paid abroad: the heir can deduct the foreign tax (within certain limits) when settling the Spanish tax.
In practice, we see many heirs who only realise late that they can deduct what they paid abroad, because they were unaware of the bilateral framework. It is best to review the bilateral situation of the country of residence before filing, not after.
Required documentation
The minimum documentation usually needed for an inheritance with a non-resident heir:
- Full death certificate of the deceased.
- Certificate from the General Registry of Last Wills.
- Will (if any) or, otherwise, the declaration of heirs (abintestato).
- Inventory of assets with valuations or value certificates (bank balances, vehicles, real estate).
- ID document or NIE of all heirs.
- Tax residence certificate of the non-resident heir, issued by their country.
- If there is real estate: up-to-date Land Registry extract and the latest IBI receipt.
- If there is life insurance: insurer's certificate stating beneficiaries.
Common mistakes in cross-border inheritances
From the cases we see every year, the same mistakes recur:
- Assuming that the state regulations apply “by default”, when in many cases the more favourable regional regulations can be applied.
- Failing to check whether a double-taxation treaty exists with the heir's country of residence.
- Forgetting the plusvalía municipal of the city council where the property is located, which has its own deadline and is sometimes processed in parallel with Form 650.
- Miscalculating the 6-month deadline when the heir is abroad and is informed of the death late. The deadline runs from the date of death itself, not from the date the heir receives the news.
- Trying to file Form 650 without first obtaining the heir's NIE. The Tax Agency will not accept the filing.
How GESTISYD can help
- We assess your case and identify the regional regulations that apply to you.
- We compute the tax due and apply the reductions and allowances that fit your situation.
- We coordinate with the notary and the Land Registry where needed.
- We work in both Spanish and English.
Do you have an inheritance with a non-resident heir?
We tell you which regulations apply, the deadlines and the documentation required.