If you have received an inheritance in the last fiscal year, you may be wondering how it affects your annual Spanish income tax declaration. In this blog post, we look at the different aspects of inheritance in terms of wealth and assets and discuss whether they should form part of your personal income tax declaration.
Important: Spanish succession follows two distinct paths depending on whether the deceased left a valid will (testate) or not (intestate). The intestate path requires a Declaration of Intestate Heirs (Declaración de Herederos Abintestato) — a step not needed when a will exists. Learn more about the succession process →
Find out about inheritance tax and laws in Spain
If I earn income from my inheritance, should I include this in my Spanish income tax declaration?
The answer to this question is usually yes, although it depends to some extent on the type of asset and what you do with it.
Inheriting property
If your inheritance includes property and you decide to let or sell it, you should declare it as follows:
Earnings from letting – the money you earn from the rental forms part of your annual income and should therefore be included on the income tax form in the letting section.
Earnings from selling – if the sale of the property earns you a profit (capital gains), you must declare this as part of your annual income and include it in the income tax form.
Inheriting cash
If you received an amount in cash from your inheritance, you must declare this when you file your inheritance tax. Once you have done so, there is no need to declare it again on your income tax form.
In a nutshell – if the asset generates income or gains for you and was not already included in your inheritance tax declaration, you must declare it on your annual income tax form.
Read about tax representation in Spain
Should I declare my inheritance in my annual income tax form?
Generally, the answer is no because you have already declared it when you filed your inheritance tax return. The amount of inheritance tax you pay depends on the amount you inherit, your relationship with the deceased, their place of residence and where you live.
Do I need professional help with declaring inheritance and income tax?
Both are complex subjects and even more so if you don’t speak fluent Spanish. In addition, it’s all too easy to omit essential details on a tax form if you don’t know exactly what you’re doing. And as result, you could end up with a fine for failing to declare everything or paying tax that wasn’t necessary.
To avoid both scenarios, we always recommend that you take expert professional advice to save you time and stress and probably money!
The Costaluz Lawyers team includes experienced professionals with a long track record in inheritance law and Spanish tax matters. Get in touch with them now to find out how they can help you.
For a complete overview of taxation in Spain, see our Your Guide to Spanish Tax.
Aviso legal: Esta informacion se proporciona unicamente a titulo orientativo y no constituye asesoramiento fiscal o legal personalizado. Cada caso debe evaluarse de forma individual segun las circunstancias especificas del cliente. Es imprescindible consultar a un especialista cualificado antes de tomar cualquier decision.
Legal Notice: The content on this page is provided for general informational and educational purposes only. It does not constitute legal advice and should not be relied upon as such. No action should be taken based solely on this content without first seeking independent professional legal counsel. Each case requires individual assessment based on its specific circumstances. CostaLuz Lawyers accepts no liability for actions taken or not taken based on this content.
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This content has been prepared with the assistance of artificial intelligence and reviewed by María Luisa de Castro, a lawyer specialising in Real Estate Law and founder of CostaLuz Lawyers.
The information provided is general and indicative in nature. It should not be used as the sole basis for making professional, legal or investment decisions, and CostaLuz Lawyers assumes no responsibility for decisions taken solely on the basis of this content.
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