Inheritance tax reductions Andalucia 2017

Filed under : Tax Planning - Inheritance, Wills, Probate & Inheritance

Inheritance tax reductions for Andalucía

The Junta de Andalucía is set to increase the tax free sum before inheritance tax is payable on estates within the region of Andalucía. At present the amount a spouse or direct descendant can receive is 175.000€ before any succession tax is payable. From January 2017 this is set to rise to 250.000€. In addition to this if the amount inherited was above the 175.000€ the tax is currently payable on the whole sum. However from 2017 this provision would only kick in if the estate is valued at more than 350.000€.

In Spain inheritance tax is a donee tax falling on the person who receives. As an example of the change two children of the deceased each receiving 250.000€ would pay no inheritance tax after January 2017 whereas at present they would each pay 38.875€.

The inheritance tax payable on estates in Spain both for Spanish residents and for European Union nationals is a regional tax so some regions have always charged more and some less than Andalucía. It is not possible to say if there will be some separate agreement on this tax if Britain does proceed to leave the EU. The original decision to allow these rates to EU nationals was a decision of the European court so it is quite possible higher rates will be imposed on British nationals in future.

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