How much inheritance tax do direct relatives pay in Madrid?

Children, spouses, parents and grandchildren benefit from a 99% reduction on the tax due, so the effective tax payable is almost zero for these groups.

Is there relief for siblings, aunts, uncles, nieces and nephews in Madrid?

Yes. Since 2025 and maintained for 2026, Madrid applies a 50% bonification for Group III relatives, which is siblings, aunts/uncles and nephews/nieces, a relief very few Spanish regions offer.

Should a foreigner make a Spanish will for assets in Madrid?

Yes. Under EU Regulation 650/2012 you may choose that the law of your nationality applies; a Spanish will avoids cross-border conflicts, simplifies procedures for heirs and speeds up probate.

How long does the inheritance process take in Madrid?

Typically 3 to 6 months, with the inheritance tax filed within six months of the date of death (an extension can be requested within the first five months).

Inheritance Tax in Madrid 2026 — Near-Zero for Families

Q: Do gifts (donations) get the same Madrid relief?

Gifts between parents and children also benefit from the 99% reduction, provided the donation is made before a Spanish notary, making lifetime transfers very tax-efficient in Madrid.

Editorial transparency and use of artificial intelligence

This article forms part of the CostaLuz Lawyers blog and is published for general informational and educational purposes only. It was prepared with the assistance of artificial intelligence tools and, before publication, was substantively reviewed and editorially approved by Maria de Castro, a Spanish-qualified lawyer registered with the Cádiz Bar Association under number 2745, founder of CostaLuz Lawyers and the person responsible for the editorial review of the published content.

This article does not constitute legal, tax, immigration, employment, estate-planning or investment advice and does not replace an individual assessment and the professional work of the appropriate CostaLuz Lawyers specialist. No action or omission should be based solely on this information.

1. Inheritance and Gift Tax in Madrid (2025–2026)

Madrid continues to offer one of the most favourable inheritance tax regimes in Spain.

Direct relatives — children, spouses, parents and grandchildren — benefit from a 99% reduction on the inheritance tax due.
In practice, this means that the effective tax payable is almost zero for these groups.

New in 2025 and maintained for 2026:
Madrid has introduced a 50% bonification for Group III relatives — siblings, aunts/uncles, and nephews/nieces.
Very few Autonomous Regions in Spain offer such a generous relief for this degree of kinship.

Examples:

A son inheriting €500,000 → theoretical tax approx. €50,000 → with the 99% reduction, effective tax ≈ €500.
A daughter inheriting €1,000,000 → theoretical tax approx. €100,000 → with the reduction, effective tax ≈ €1,000.

Gift Tax (Donations)

Gifts between parents and children also benefit from the 99% reduction, provided the donation is made before a Spanish notary.
This makes lifetime transfers extremely tax-efficient in Madrid.

2. Making a Will in Madrid (2025–2026)

Foreigners with property or assets in Madrid are strongly encouraged to make a Spanish will.

Under EU Regulation 650/2012, you may choose that the law of your nationality applies to your inheritance.
A Spanish will:

avoids cross-border legal conflicts,
simplifies procedures for your heirs, and
significantly speeds up the probate process.

Wills are signed before a Spanish notary and registered in the Central Registry of Wills.

3. Executing an Inheritance in Madrid (Probate Process – 2025–2026)

The inheritance process generally follows these steps:

Obtain the death certificate (apostilled/translated if foreign).
Request the Spanish Last Will Certificate (“Certificado de Últimas Voluntades”).
Collect all asset information (bank accounts, property, investments, vehicles).
Sign the Inheritance Deed before a notary (escritura de aceptación de herencia).
File the inheritance tax within 6 months of the date of death (extension can be requested within the first 5 months).
Update the Land Registry if property is inherited.

Typical timeframe: 3–6 months, depending on documentation and family coordination.

Do you have questions about inheritance in Madrid?

Spanish inheritance law can feel complicated, especially for foreigners or families who are not familiar with regional rules.

Whether you need help with:

designing your Spanish will in coordination with your wills abroad,
calculating inheritance or gift tax, or
completing the full inheritance process from abroad,

CostaLuz Lawyers can guide you step by step.

The form has been submitted successfully!

There has been some error while submitting the form. Please verify all form fields again.

Related Tax Guides for Expats in Spain

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

Disclaimer: This information is provided for general guidance purposes only and does not constitute personalised tax or legal advice. Each case must be assessed individually according to the client’s specific circumstances. It is essential to consult a qualified specialist before taking any action or making any 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.

Dealing with an inheritance in Spain?

We guide foreign heirs through the entire Spanish inheritance and probate process. Bilingual help across southern Spain since 2006.

Email María Luisa Read our Spanish inheritance guide

Client line (EN/ES): +34 919 499 342 · marialuisa@costaluzlawyers.es · Costaluz Lawyers — María Luisa de Castro, ICA Cádiz nº 2745.