February 14, 2019
The wind of (positive) change is blowing in Andalusia. This autonomous Spanish region has been for the last 40 years “famous” by its very high inheritance tax. This is going to change in 2019. Andalusia’s center-left wing party lost the power in December 2018 and the new coalition has agreed to abolish inheritance tax in Andalusia. Actually, not abolish completely but reduce it by 99% on all estates above 1.000.000 EUR.
It will be with no doubts one of the most important decisions taken by the coalition. It is a result of a long campaign led by political activists, such as ‘Stop Sucesiones’ and other political groups.
Thanks to this decision most inheritors in Andalusia will no longer need to pay inheritance tax on the assets inherited from their parents or spouses. This fiscal change follows the earlier one, introduced in 2017, abolishing inheritance tax on assets below 1.000.000 EUR.
This is how inheritance tax will look like in Andalusia:
•“Pre-existing wealth nil-rate band raised to 1.000000 EUR (per inheritor).
•Estates equal to or below 1.000.000 EUR will go untaxed (per inheritor).
•Estates over 1.000.000 EUR will be benefit from a 99% exemption (per inheritor). Meaning you only pay 1% over what exceeds the 1.000.000 EUR threshold.”
•To benefit from this tax allowance, you need to be EEA/EU-resident.
•“Group I: natural and adopted children under 21.
•Group II: natural and adopted children over 21, spouse, registered civil partnerships, parents, adoptive parents, grandparents and great-grandparents.”
This important change makes Andalusia to join other autonomous Spanish regions which apply reductions on inheritance tax to the point of practically abolishing it, i.e. Madrid, Basque Country, La Rioja, Navarre, Catalonia, Valencia, Balearic and Canary Islands.
The inheritance tax abolition is a very important news for Andalusian real estate market. I really don’t need to explain its positive impact. It’s just a pleasure to observe politicians doing something right for a change. The inheritance tax which used to be a huge weakness of Andalusian real estate market now turns out to become one of its important selling points.
Source: Larraín Nesbitt Lawyers Marbella
29 September, 2022
15 September, 2022