# Spain's Inheritance Tax challenged by EU!'



## GUAPACHICA (Jun 30, 2012)

Hi all - apologies if this subject has been aired already, elsewhere in this forum. Again, this is copied from the 'SurinEnglish' online newspaper website.

This recent decision by the EU Court might well affect many current and future expats. and immigrants to Spain: 

European Court rules Spain?s inheritance taxes are illegal. Surinenglish.com

Saludos,
GC


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## Alcalaina (Aug 6, 2010)

Yes, it is good news for anyone who had to pay the top rate IHT because they were non-resident and therefore didn't qualify for the reductions offered by the regions to residents. They can now apply for a refund for the difference.

It should also reassure those who were worried about retiring and buying property here because their non-resident children would have had to pay the top rate when they eventually inherit.

But I believe the government has made noises about standardising the reductions offered by the regions, as they do vary widely.


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## Guest (Sep 9, 2014)

You have no idea how happy that news makes me -


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## baldilocks (Mar 7, 2010)

meetloaf said:


> You have no idea how happy that news makes me -


This sounds potentially disastrous for anyone resident in Spain. If they decide to make it a national thing rather than regional, those of us who live in, for example, where the inheritance by a spouse is virtually tax-free, may well end up paying a lot. Why can't interfering busybodies keep their noses out?


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## extranjero (Nov 16, 2012)

baldilocks said:


> This sounds potentially disastrous for anyone resident in Spain. If they decide to make it a national thing rather than regional, those of us who live in, for example, where the inheritance by a spouse is virtually tax-free, may well end up paying a lot. Why can't interfering busybodies keep their noses out?


How selfish! Seems like a case of "I 'm alright jack " for you then! Ok if it's disastrous for some poor sod in Murcia, with no regional allowances?
Why should some pay nothing, and others thousands on the basis of where you live, like a postcode lottery.
IHT is too important to be left to regional governments to decide.
It should be a state tax, with a decent, state allowance, not the miserly amount it is now!
The whole tax has been long overdue for an overhaul, which is what is happening now.
Perhaps the ones who decide could see how unfair it is for spouses and registered partners to pay this tax on assets built up together over many years with money that's already been taxed.
Congratulations to the fair minded expat who started the ball rolling.
Let's hope there will be changes which make this tax fairer for everyone, not just some lucky enough to be in the position of paying nothing or a very small amount should the inevitable occur while living in Spain.
Now Baldy, if the regional government in your state decided to abolish your very generous IHT allowances, would you still moan about "interfering busybodies, "if someone had the guts to put his head over the parapet and Petiton the EU?


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## baldilocks (Mar 7, 2010)

extranjero said:


> How selfish! Seems like a case of "I 'm alright jack " for you then! Ok if it's disastrous for some poor sod in Murcia, with no regional allowances?
> Why should some pay nothing, and others thousands on the basis of where you live, like a postcode lottery.
> IHT is too important to be left to regional governments to decide.
> It should be a state tax, with a decent, state allowance, not the miserly amount it is now!
> ...


That is just my point. Here the allowance for spouses who as you quite rightly say have helped to build up the assets that are being taxed should have an allowance of more or less 100%. What I complain about is that some busybody worrying about non-residents is trying take that away.

Those in the likes of Murcia should be the ones doing something about what their OWN community has conspired to take away from them. I wouldn't mind betting that the rich landowners (the curse of Spain) don't pay it, and that their assets are, somehow, protected just as they always have been.

It seems to be a case of people not doing proper research before they decided where to live. France was high on our list of potential retirement locations until I worked out the rate of taxation.


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## extranjero (Nov 16, 2012)

baldilocks said:


> That is just my point. Here the allowance for spouses who as you quite rightly say have helped to build up the assets that are being taxed should have an allowance of more or less 100%. What I complain about is that some busybody worrying about non-residents is trying take that away.
> 
> Those in the likes of Murcia should be the ones doing something about what their OWN community has conspired to take away from them. I wouldn't mind betting that the rich landowners (the curse of Spain) don't pay it, and that their assets are, somehow, protected just as they always have been.
> 
> It seems to be a case of people not doing proper research before they decided where to live. France was high on our list of potential retirement locations until I worked out the rate of taxation.


The petitioner was not trying to take rights away. He was tring to make it fairer and to start the ball fooling towards an overhaul of this unfairly structured and penalising tax
There is no exemption for spouses, and I hope this will change.
As for people not doing research before deciding where to live, Murcia has always had a generous allowance for IHT; it was only abolished last year.
How could anyone know this was going to happen.
The regional allowance could have been abolished where you live, would that be because of your lack of research-of course not!
It seemed to me from your post,that as long as you were all right , never mind those who would be in real trouble, keep the staus quo.


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## baldilocks (Mar 7, 2010)

extranjero said:


> The petitioner was not trying to take rights away. He was tring to make it fairer and to start the ball fooling towards an overhaul of this unfairly structured and penalising tax
> There is no exemption for spouses, and I hope this will change.
> As for people not doing research before deciding where to live, Murcia has always had a generous allowance for IHT; it was only abolished last year.
> How could anyone know this was going to happen.
> ...


Seems like those who live in Murcia should have been leaning on their regional government and campaigning through their votes.


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## extranjero (Nov 16, 2012)

No region should have the power to abolish something so important at a stroke.
The government should have clamped down on them.
IHT allowances are supposed to benefit people- some benefit!
I suppose people don't think campaigns will make any difference, but with this EU ruling, and the fact that regional IHT is being looked at, perhaps a fairer scheme will emerge.


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## baldilocks (Mar 7, 2010)

extranjero said:


> No region should have the power to abolish something so important at a stroke.
> The government should have clamped down on them.
> IHT allowances are supposed to benefit people- some benefit!
> I suppose people don't think campaigns will make any difference, but with this EU ruling, and the fact that regional IHT is being looked at, perhaps a fairer scheme will emerge.


There will be many more losers than gainers.

As for the government clamping down, it may well have been with their blessing especially as the government of the AC is the same flavour as the national one and, of course, it is one that favours the rich versus the poor.


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## Guest (Sep 10, 2014)

There are winners and losers, as with all changes, but as Baldy is reacting and writing from his perspective, so I shall from mine. A move to Spain for two pensioners is a huge risk with IHT hanging over our heads for five years. Any change has to be an improvement on the present situation. I'm over the moon about this.

Having got that out of the way, It's clearly an unfair tax win its present form and the EU agrees. It remains to be seen whether the gov takes the opportunity to introduce a fairer system, e.g., a flat 6% for residents and non residents alike. That way the burden would be spread. But of course, fairness and politics are not always renown as close bedfellows.


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## mrypg9 (Apr 26, 2008)

I wonder how many of these disgruntled British immigrants bother to vote?
How many research thoroughly what taxes they might have to pay?
How many factor into their plans that tax regimes change?
As in the UK or any country....


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## baldilocks (Mar 7, 2010)

mrypg9 said:


> I wonder how many of these disgruntled British immigrants bother to vote?
> How many research thoroughly what taxes they might have to pay?
> *How many factor into their plans that tax regimes change?
> As in the UK or any country....*


Rather difficult to factor those changes in because as governments change colour and priorities, rates of tax and tax regimes in general change, often unpredictably.


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## el romeral (May 8, 2012)

It is the worst thing about living in Spain - especially an :frusty:autonomous region:frusty: - uncertainty, rule changes, moving goal posts etc etc. You never really know where you are? :smash::lever:


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