Spain: Lower income tax for real estate received by inheritance

folder_openFamily / Succession, Gift tax, Immobilier
baisse impôt revenu espagne

In a recent resolution on 15 September 2021, the Spanish Supreme Court ruled on how to determine the purchase value of a building received as an inheritance. It is different from what the Spanish Tax Authority was considering, which obviously tended to be worse for the taxpayer.

The Court ruled that, for Income Tax purposes, the declared value of the real estate in the Inheritance Tax declaration by the heirs must be considered, rather than the cadastral value registered in the Spanish Cadastral Registry. Since that affects the depreciable value of the building, it has a certain impact on the heirs’ income tax, especially where high-value real estate is concerned.

In summary, this decision will lead to a lower income tax payment for those who receive real estate by inheritance and must pay personal income tax in Spain.

(Author: Lexunion España, Barcelona)

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