Residents in Spain are liable for Spanish Inheritance Tax (IHT - El impuesto sobre sucesiones y donaciones) regardeless in which the inheritance is located, you are considered a resident if you spend more than 183 days on Spanish territory during the calendar year; the main centre or base of your activities or economic interests is in Spain, directly or indirectly.

The tax must be paid within 6 months of the death, it is possible to ask for an additional delay of 6 months but then there is an interest to be paid on this extension. The tax is due because the beneficiary acquires an asset and not because it is transferred to him or her. There is no exemption between husband and wife, the one who survive pay. Beneficiaries (Donees and inheritors) are divide into four groups :

Group 1: Descendants, natural and adopted children under 21

Group 2: Descendants, natural and adopted children over 21, spouses, parents and adoptant parents , unmarried partners.

Group 3: Relatives in second and third degree, that is, brothers/sisters and nephews/uncles, stepchildren, cousins.

Group 4: Relatives in forth degree, or without any relationship.

Once the proper allowance has been determined a tax rates is applied, the tax rates depend upon the value of the amount inherited. It can be a costly tax, it is possible to reduce by forming a corporation and transfer the assets to that corporation, for more information consult a professional, the info I post here are just introduction.

Note : The legal concept of Trust does not exist in Spanish Law .

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