How foreign nationals living in Spain can use “Brussels IV” to leave their estate to a Foundation/Charity (and the tax upsides)

Author: María — CostaLuz Lawyers
Published: 16 October 2025

TL;DR — If you live in Spain and hold a non-Spanish nationality, the EU Succession Regulation (“Brussels IV”) lets you choose the law of your nationality to govern your entire estate. Many national laws grant full freedom of testation (no forced heirship), which can make it simpler to benefit a charity or foundation. In Spain, qualifying charities/foundations typically enjoy inheritance-tax and corporate-tax relief, so more of your legacy reaches the cause.

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Who this is for

• Foreign nationals (including dual nationals) who reside in Spain.
• Anyone wishing to leave part or all of their estate to a charity/foundation—in Spain or abroad.
• People who want to reduce conflict and increase impact, lawfully.

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Brussels IV in two lines

1. Default rule: if you do nothing, your succession is generally governed by the law of your habitual residence (often Spain).
2. Your lever: you can elect the law of your nationality to govern your entire estate—put this expressly in your will.

Why it matters: If your national law doesn’t impose forced heirship (or imposes milder restrictions), you gain more freedom to make charitable bequests—sometimes 100%. Always check your specific national rules.

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The practical playbook

1. Map your position
   • Which nationalities you hold (now, and at death).
   • Where you live and where your assets sit (Spain/other countries).
   • Whether your national law gives freedom of testation.
2. Spanish notarial will + choice-of-law clause
   • Add a clear clause: “I choose the law of my nationality [country] to govern my succession.”
   • Identify the charity/foundation precisely (legal name, tax ID, address).
   • Include substitutions (backup beneficiary with similar purpose).
3. Choose the right beneficiary entity
   • Prefer entities that qualify for Spain’s Law 49/2002 (public-benefit charities/foundations) to optimise tax treatment.
4. Coordinate cross-border
   • If you hold assets outside the EU, check local conflict-of-laws rules.
   • Consider life insurance with the charity as beneficiary to simplify logistics.
5. Paper trail
   • Keep nationality proofs, the charity’s registration/tax status, policies, and a notarial copy of your will. Less friction later.

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Quick scenarios

• “All to a Foundation”
  UK national living in Spain elects English law in a Spanish will; leaves 100% to a foundation.
• “Split with purpose”
  National of a country with limited forced heirship elects that law; leaves a large share to an NGO, a defined minimum to family.
• “Dual national”
  Dual national chooses the nationality whose law offers greater testamentary freedom; sets specific charitable legacies and a purpose-restricted fund.

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Spanish tax upsides when leaving assets to a charity/foundation

• Inheritance & Gift Tax (ISD)
  In Spain, qualifying charities/foundations generally do not pay ISD on inheritances/legacies they receive—so the gift reaches them gross. This is a key advantage versus leaving the same amount to individuals (who are typically taxed under regional rules).
• Corporate Tax for the entity
  Under Law 49/2002, eligible non-profits enjoy exemptions/reliefs on income from inheritances and donations and a favourable regime overall.

Bottom line: Directing assets to a qualifying foundation/charity usually means minimal Spanish tax drag at the entity level, maximising impact. (Separate donor deductions apply to lifetime gifts under Law 49/2002; the will strategy concerns death transfers.)

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Common pitfalls (and easy fixes)

• No choice-of-law → Spanish law applies by residence; forced heirship may restrict charitable giving. Fix: add an express election.
• Vague beneficiary → Use the exact legal name and tax ID.
• No fallback clause → Name a substitute with a similar purpose.
• Forgetting non-EU assets → Get local advice and align with your main will.
• Out-of-date nationality → The election must match a nationality you hold when you sign or when you die.

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Mini-FAQ

Can I pick any law I like?
No—you can choose only the law of your nationality (any of them, if you hold several). Put it expressly in your will.

Does this avoid Spanish forced-heirship rules automatically?
It doesn’t “avoid” so much as change the applicable law. If the elected national law has no or lighter forced heirship, you usually have far more freedom.

Can I split by asset type (one law for property, another for cash)?
No. Brussels IV applies one law to the whole estate to keep it coherent.

Will the charity actually get the money tax-free in Spain?
If it’s a qualifying non-profit/foundation, Spanish rules generally exempt inheritances received by such entities, and Law 49/2002 gives preferential corporate-tax treatment.

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Compliance checklist for your Spanish notary meeting

• Confirm current nationality(ies).
• Insert express choice-of-law clause (country + Brussels IV reference).
• Name the foundation/charity with full legal details (name, tax ID, address).
• Add substitution (backup beneficiary; similar purpose).
• Review life insurance beneficiary designations.
• Verify the entity’s Law 49/2002 status (or equivalent) for tax efficiency.
• If you own non-EU assets, align with local counsel.

Make your legacy count.
Claim a free consultation to design a will that maximises your gift to a foundation or charity—legally, clearly, and with minimal tax drag in Spain.

Schedule: info@costaluzlawyers.com

For a complete overview of wills and inheritance in Spain, see our Spanish Wills & Testament Guide 2026.