More and more British citizens have holiday properties in Spain. Some of them, move to Spain for their retirement. So, when they die, their relatives don’t have to deal with the inheritance just in UK, but also in Spain.
Spain and United Kingdom have very different inheritance laws, so, where, when and how to deal with an inheritance of a British citizen who had properties in Spain?
To answer this question, first of all, we have to contradistinguish four different situations:
The deceased died in United Kingdom without a Last Will and Testament (called “ab-intestato” in Spanish)
The deceased died in Spain without a last Will and Testament
The deceased died in Spain or United Kingdom (doesn’t matter) with a Spanish Will
The deceased died in Spain or United Kingdom with an English-Welsh Will
In this first post, we will study why where the person passed away is so important and we will see what happens in the first two scenarios (dying without a Last Will and Testament).
Why is it important where the person died?
The place where the person died, specially if there isn’t a Last Will, will decide the applicable law. Regulation (EU) No 650/2012 of the European Parliament regulates the inheritance inside European Union. This Regulation applies in all European Union countries except Denmark and Ireland.
For Regulation 650/2012 there are two possible applicable law: the law of the deceased nationality or the law of the residence. Which one applies?
If the deceased has passed away without a Last Will and Testament, the domicile law will apply. It doesn’t matter which nationality the deceased had.
If the deceased died with a Last Will and Testament, the Regulation gives him/her two option: the testator or testatrix is able to choose between his or her national law or the law of the residence. If nothing is said in the Last Will, the residence law applies.
Under English law, the law of succession is the law of deceased domicile. Domicile, under English law, has a specific and legal meaning.
In general lines, a British citizen acquires his or her domicile from his parents and retains it unless some specific decisions are taken. In this second case, we are talking about “domicile of choice”. Acquisition a new domicile requires two elements:
Residence in a new country
Intention to reside there permanently and indefinitely
First scenario: passed away in UK without a Last Will and Testament
As we have already explained, in this case, the UK law applies. Under English-Welsh law (Scotland has its own law for inheritance) the husband, wife or civil partner keeps all the assets (including property), up to £250,000, and all the personal possessions, whatever their value.
The remainder of the estate will be shared as follows:
the husband, wife or civil partner gets an absolute interest in half of the remainder
the other half is then divided equally between the surviving children. If a son or daughter (or other child where the deceased had a parental role) has already died, their children will inherit in their place.
The heirs or any person interested in the inheritance (p.e. a person who is representing the heirs) has the right to apply for a “Letter of Administration”. A Letter of Administration is a legal document, issued by a Court, who allows to the administrator to deal with the estate of the deceased.
The person who will be in charge of the deceased assets is called administrator. Any of the possible heirs, or any person interested in the inheritance, can apply as a future administrator.
The “Letter of Administration” form has to be sent, with a tax form, to the Court. Within 4-6 weeks, the applicant will receive a letter from the Court allowing him or her to be the administrator of the estate.
Second scenario: passed away in Spain without a Last Will and Testament
As we have seen, if the deceased passed away in Spain and there isn’t a Last Will and Testament, the domicile law applies. In this case, if the person was living in Spain for, at least, 5 years, Spanish law will apply.
First step, under Spanish law, if the deceased was married under “Sociedad de gananciales” option, is split the assets of the marriage. Each spouse will receive a part of the common assets.
Parallel, the heirs has to apply for “Últimas Voluntades” document. Últimas Voluntades is a legal document, issued by the Registro de Últimas Voluntades (part of Justice Ministry) where it is said if the deceased has or not Last Will and Testament.
As we don’t have a Last Will and testament, the help of a Notary Public is required. The heirs, as well as two witnesses, has to go to one of the Notary Public closest to the place of death and ask for a “declaración de herederos” (declaration of heirs). In this deed, the Notary Public will explain who the heirs under Spanish law are:
If there are descendants, they will be the heirs in equal parts
If there aren’t descendants, the heirs will be, in the following order: the ascendants, and then the widow or widower, then the siblings and children of siblings and lastly, cousins.
However, some regions (as Basque Country, Aragon, Navarra, Cataluña and Baleares) have their own inheritance rules.
Dying with a Last Will and Testament and next steps
We know we have given you a lot of information. Please, keep calm! We are going to take a rest now and we will go on in our next post. Next week we will see what to do if we have an English-Welsh or Spanish Will and what are the next steps.
However, if you are dealing with an inheritance with assets in Spain, you have any doubts or you just can’t wait until next week, do no hesitate to contact us!
Written by Ana Escauriaza