Spain Inheritance Tax by Region 2026: Andalusia vs Catalonia vs Madrid

Spanish inheritance tax (Impuesto sobre Sucesiones y Donaciones) is one of the most regionally variable taxes in Spain — what an heir pays depends on the autonomous community where the deceased was tax resident at death (or, for non-residents inheriting Spanish-located assets, the autonomous community where those assets are situated). The differences across regions are large: Madrid offers near-100% bonifications between close relatives, while Catalonia and Asturias apply much higher effective rates. This guide compares three of the most-asked-about regions for foreign owners of Spanish assets: Andalusia, Catalonia, and Madrid.

The State Framework — A Common Starting Point

The Spanish state law establishes a common inheritance tax framework: progressive rates from 7.65% to 34% on the inheriting share, multiplier coefficients based on the heir’s existing wealth and proximity to the deceased (Group I-IV), and standard reductions for spouse, descendants, and ascendants. Each autonomous community then applies its own bonifications, increased reductions, or rate adjustments — which is where the regional differences emerge. The state framework still applies on top, with the regional benefits layered in.

Andalusia — Near-Total Relief Between Close Relatives

Andalusia has been one of the most aggressive regions in reducing the inheritance tax burden between close relatives (Group I and II — descendants, ascendants, spouse). Bonifications reach 99% on inheritance shares between these family members, meaning the effective tax is reduced almost to zero on the family-relevant portion. Inheritances from cousins, friends, or unrelated parties (Group III and IV) face the standard schedule with limited or no regional relief. Andalusia is consequently one of the most attractive regions for relocating retirees who want their estate to pass cleanly to children and spouse.

Catalonia — Higher Effective Rates

Catalonia applies the standard schedule with significantly less regional relief, particularly above mid-range estate sizes. Reductions for descendants and spouse exist but cap at thresholds materially below Andalusia’s bonifications. Effective tax on a sizeable inheritance from a Catalan-resident parent to an adult child can run 15% to 25% of the inherited share — a meaningful number when planning the estate. The position has fluctuated over the years as different regional governments have adjusted, so always verify current law before making decisions.

Madrid — Group I and II Bonification Maintained

Madrid has long maintained a 99% bonification for inheritances between Group I and II relatives — making it (alongside Andalusia) one of the regions where close-family inheritances effectively pay almost nothing. Madrid also offers favourable treatment on lifetime gifts (donaciones) between close family. The combination of low inheritance tax and 100% wealth tax bonification makes Madrid an attractive seat for high-net-worth individuals planning estate transfers, although the State Solidarity Tax (ISGF) still applies on Spanish assets above the higher state threshold.

Frequently Asked Questions

Which region’s law applies to my estate?

For Spanish tax residents, the autonomous community where the deceased had habitual residence at death applies — typically determined by where they spent the most days in the five years before death. For non-residents inheriting Spanish-located assets, the region where the highest-value asset is located applies, with EU-residency-based rules giving non-residents access to regional bonifications.

What’s the filing deadline?

Spanish inheritance tax has a six-month filing window from the date of death. A six-month extension can be requested before the original deadline expires. Late filing triggers surcharges and interest. If you believe the property’s valuation used for this tax is too high, see how to challenge a property valuation for Spanish inheritance tax. And if the estate carries more debts than assets, see how to disclaim an inheritance in Spain.

How can I plan to reduce the bill?

Lifetime gifts in regions with low gift tax can transfer assets ahead of inheritance. Trust structures (where compatible with Spanish-civil-law principles) and life insurance can also be relevant. Pre-mortem estate planning produces materially better outcomes than post-mortem rectification.

Reviewed by: Maria Luisa de Castro, Expert in Off-plan Property Investment, CostaLuz Lawyers. Last updated: May 2026.