Private client law in Spain: overview

A Q&A guide to private client law in Spain.

The Q&A gives a high level overview of tax; tax residence; inheritance tax; buying property; wills and estate management; succession regimes; intestacy; trusts; charities; co-ownership; familial relationships; minority and capacity, and proposals for reform.

To compare answers across multiple jurisdictions, visit the Private client Country Q&A tool.

The Q&A is part of the global guide to private client law. For a full list of jurisdictional Q&As visit

Sonia Velasco, Iñigo Aguirrezabala and Carlos Gomez Liguerre, Cuatrecasas, Gonçalves Pereira


Tax year and payment dates

1. When does the official tax year start and finish in your jurisdiction and what are the tax payment dates/deadlines?

For personal income tax, the tax year generally coincides with the calendar year. The tax payment dates are approved for each year and are usually scheduled between 1 May and 30 June.

Non-residents income tax accrues when the income is obtained and on an accrual basis. The payment must be made within the first 20 days after each calendar quarter. For income derived from the sale of real estate, the payment must be made within the three months following the month after the transfer was carried out.

Inheritance tax accrues at the time of decease and must be paid within the following six months. Gift tax accrues at the time of donation and must be paid within the month following the date of donation.

Wealth tax accrues on 31 December and the payment term generally coincides with that of personal income tax.

Domicile and residence

2. What concepts determine tax liability in your jurisdiction (for example, domicile and residence)? In what context(s) are they relevant and how do they impact on a taxpayer?


In general terms, tax liability in Spain is determined by the concept of permanent residence, whereas citizenship is irrelevant. An individual is considered a permanent resident in Spain in any of the following circumstances:

  • An individual that spends over 183 days in a calendar year in Spain is deemed to be a tax resident (presence test). Temporary absences are considered time residing in Spain unless a residence certificate issued by another jurisdiction is provided.

  • When the individual's main centre of business activities or interests is directly or indirectly located in Spanish territory.

If the spouse and underage children reside permanently in Spain, residence is presumed unless sufficient proof is provided to the contrary.

These criteria of residency apply for personal income tax, wealth tax, inheritance tax and gift tax.


If there is no permanent residence in Spain, tax liability can still exist when income is obtained in Spain or when assets or rights are located in Spain.

Taxation on exit

3. Does your jurisdiction impose any tax when a person leaves (for example, an exit tax)? Are there any other consequences of leaving (particularly with regard to individuals domiciled in your jurisdiction)?

On 1 January 2015, Spain introduced an exit tax. Individuals that have been permanent residents for at least ten years during the previous 15 years and cease to be residents are taxed on any unrealised capital gain derived from shares or interests in any type of entity.

Taxation is only imposed when either:

  • The total value held in those assets exceeds EUR4 million.

  • The individual holds a stake of at least 25% in an entity and its value exceeds EUR1 million. In this case, only the gains considered to derive from this stake are taxed.

If the change of residence is temporary and some requirements are met, the tax due can be deferred for five years if the proper guarantee is submitted (preferably a bank guarantee or a pledge over the securities). If the deferral of the tax due is not requested, when acquiring Spanish residence again, the individual is entitled to claim the refund of the tax due.

If the residence is changed to an EU or European Economic Area (EEA) country with which Spain has an effective exchange of information, no tax is imposed unless either:

  • The assets are eventually transferred.

  • The individual changes residence again to a non-EU or EEA country before a ten-year period has elapsed since leaving Spain.

To benefit from the EU or EEA deferral regime, an individual must communicate his new address (and subsequent changes of domicile) to the Tax Administration using the appropriate form.

In addition to exit tax, individuals who cease to be residents must include in their income tax return any taxable income that has been deferred.

Temporary residents

4. Does your jurisdiction have any particular tax rules affecting temporary residents?

Individuals that acquire Spanish residency for employment reasons can choose to be taxed for the first five years as non-residents if specific requirements are met. This regime is not applicable to professional athletes or company directors that have a stake of at least 25% in a company.

The regime mainly implies that income obtained directly in Spain, and any employment income obtained worldwide is subject to taxation. In general terms, gross income is taxed at 24% for the first EUR600,000 and at 45% for any amount above that. Dividends, interests and capital gains are taxed separately at between 19% and 23%, depending on the income obtained.

Wealth tax is only imposed on assets located in Spain.

Taxes on the gains and income of foreign nationals

5. How are gains on real estate or other assets owned by a foreign national taxed? What are the relevant tax rates?

Citizenship and nationality are irrelevant for Spanish taxation. Therefore, the answers to these questions refer to non-residents.

Capital gains obtained in Spain by non-residents are subject to the Non-Residents Income Tax Act, under which capital gains are taxed at 19%. The acquirer of a real estate asset from a non-resident must withhold 3% of the transfer value. The transferor can offset the tax due against the withholding, and is entitled to a refund of the excess withheld.

Additionally, when transferring real estate, a municipal tax applies on the increase of the land value. The income is assessed and calculated based on the cadastral value of the land. The applicable rate varies between municipalities, but must not exceed 30%. Cadastral values are generally lower than market value and the deemed increase is based on inflation rates rather than on real market increases.

6. How is income received by a foreign national taxed? Is there a withholding tax? What are the income tax rates?

Despite some exceptions, any income obtained in Spain by a non-resident is subject to taxation under the Non-Residents Income Tax Act. In general terms, gross income is taxed at 24% and no reductions are applicable. However, the tax rate applicable to residents of an EU or EEA country, with an exchange of information agreement, is 19%.

Additionally, the calculation of taxable income for residents in an EU country, or EEA country with an effective exchange of information agreement, allows deduction of expenses incurred, to the same extent as Spanish residents.

The tax rate for dividends, interests and capital gains is 19%.

Inheritance tax and lifetime gifts

7. What is the basis of the inheritance tax or gift tax regime (or alternative regime if relevant)?

The Inheritance and Gift Tax Act (IGTA) provides for a common regulation of tax and gift taxes. It establishes the main tax provisions that must be applied throughout the country. However, the autonomous regions that make up Spain can modify for their own territories the applicable tax rates and the applicable tax reliefs, which means that the effective tax rates vary substantially between autonomous regions.

The taxpayer of inheritance and gift tax is the beneficiary and, in general terms, the tax due is determined based on both:

  • The amount received, which includes the proceeds of life insurance policies.

  • The beneficiary's previous wealth and relationship with the transferor.

For Spanish tax residents, the application of the autonomous regions' provisions is determined based on the residence of the deceased for inheritance tax purposes, and based on the residence of the taxpayer for gift tax purposes. However, when real estate is gifted, the applicable law for residents is that of the autonomous region where the assets are located.

Special rules determine the applicable autonomous region's legislation when the deceased or the taxpayer was resident in an EU or EEA country, or when the real estate was located in any of these countries.

The IGTA is the applicable law for non-residents in Spain, the EU or EEA that are beneficiaries of an inheritance or a gift in Spain. In certain cases, this can be considered contrary to EU Law.

8. What are the inheritance tax or gift tax rates (or alternative rates if relevant)?

Tax rates

The tax rate established in the Inheritance and Gift Tax Act (IGTA) ranges from 7.65%, when the taxable base is less than EUR8,000, to 34%, when the taxable base exceeds EUR800,000.

This tax rate is increased if the beneficiary is not the spouse, or a direct descendant or ascendant of the transferor, or if his wealth exceeds specific thresholds. Depending on those circumstances, the tax rate is multiplied by a coefficient ranging between 1.05% and 2.4%.

However, to give some examples, Madrid recognises a tax relief of 99% of the tax burden when the beneficiary is a direct descendant or ascendant or the spouse. Catalonia recognises, for inheritance tax, a tax relief of 99% for the spouse and a tax relief ranging from 10% to 99% for direct descendants or ascendants. For gift tax, Catalonia has approved a tax rate between 5% and 9% for these relatives.

Tax free allowance

Tax free allowances are only applicable to inheritances and are established under the IGTA between EUR15,956 and EUR47,858 for spouses and direct ascendants or descendants. A tax free allowance of EUR7,993 is established for other relatives of second and third degree.

Additional tax free allowances are established for impaired taxpayers, up to EUR150,000, and for beneficiaries of life insurance policies, up to EUR9,149.

While Madrid has not substantially increased these amounts, Catalonia has doubled them all.


Rather than exemptions, the IGTA establishes some reductions applicable to specific assets when inherited. The most important are those applicable to assets related to a business activity and to shares in an entity that carries out a business activity. Those assets, when certain requirements are met, can be granted a 95% reduction for their inclusion in the taxable base.

Another important reduction is that applicable to the habitual abode of the deceased, which when the requirements are met, can be 95% of the value of the abode and up to EUR122,606 for each beneficiary.

Techniques to reduce liability

The regulations of some autonomous regions are clearly more advantageous than those of the state. Therefore, one way of reducing liability is ensuring that the autonomous regions' regulations are applicable, which depends on the residence and location of the assets. When an autonomous region has advantageous tax rates for gift tax, a lifetime gift can be considered to reduce the overall tax burden.

Taking advantage of the reduction for the shares in an entity that carries out a business activity is a common way of reducing liability. However, authorities often scrutinise it and reject the reduction on any asset within the entity that is not related to the business activity.

The Spanish fideicomiso, which is somewhat similar to the generation skipping trust, and some life insurance policies can be used to reduce liability.

Holding Spanish assets through a non-resident entity avoids direct ownership of Spanish assets. However, when implementing these types of structures, attention must be paid to the type of entity used and to whether it has legal personality, and to the effect that the structure can entail in respect to other taxes (such as non-resident income tax). Additionally, any structure needs to rely on sound business purposes.

9. Does the inheritance tax or gift tax regime apply to foreign owners of real estate and other assets?

Foreigners that inherit or are gifted with real estate, or any other assets located in Spain, are subject to taxation according to the general provisions of the Inheritance and Gift Tax Act (IGTA).

However, if they are residents of the EU or the EEA, they may be entitled to apply the provisions of the autonomous region in which the assets are located or were mainly located during the previous five years.

10. Are there any other taxes on death or on lifetime gifts?

Any transfer of assets triggers personal income tax on the potential capital gain derived from the transfer. However, one exemption applies when the transfer is due to an inheritance.

The municipal tax applicable to the transfer of real estate is also triggered (see Question 5). However, some exemptions may apply for certain assets (such as the habitual abode).

Taxes on buying real estate and other assets

11. Are there any other taxes that a foreign national must consider when buying real estate and other assets in your jurisdiction?

Purchase and gift taxes

When real estate is acquired in Spain, the acquisition is subject either to value added tax (VAT) or transfer tax.

VAT is usually applicable when the seller is engaged in a business and the real estate is not a second hand building or rural land. The VAT rates are 10% for residential buildings and 21% for any other kind of real estate. When the acquisition is subject to VAT an additional stamp duty is imposed that can vary from 0.5% to 2%, depending on the autonomous region.

When not subject to VAT, the acquisition is subject to transfer tax at 6%. However, this rate can be modified by the autonomous regions. Madrid, for example, has maintained 6% as the general rate, while Catalonia has increased it to 10%.

Wealth taxes

Spain has a wealth tax that non-residents should consider when buying real estate in Spain. Wealth tax is imposed on non-residents' assets located in Spain. The tax rate ranges from 0.2%, when the value of the assets held is less than EUR167,129, to 2.5%, when the value of the assets exceeds EUR10,695,966. However, there is a tax-free allowance of EUR700,000.

The autonomous regions can modify for their own territories the applicable tax rates and the tax-free allowance, and can introduce tax reliefs, which means that the effective tax rates vary substantially between autonomous regions. Autonomous region's legislation can be applicable if the taxpayer is resident in the EU or EEA.


There is a municipal tax on the ownership of real estate in Spain that depends on the cadastral value of the property, and which it is not usually burdensome. There is also a deemed income tax for any real estate asset that is not the taxpayer's primary residence. The deemed income is calculated on the cadastral value and ranges between 1.1% and 2% of the value.

An additional tax of 3% is levied on the cadastral value of real estate assets owned by entities resident in a tax haven jurisdiction, unless any exceptions apply.

12. What tax-advantageous real estate holding structures are available in your jurisdiction for non-resident individuals?

Holding Spanish assets through a non-resident entity can avoid the direct ownership of assets located in Spain. However, when implementing these types of structures, attention must be paid to the type of entity used and to whether it has legal personality, and to the effect that the structure can entail in respect to other taxes (such as non resident income tax). Additionally, any structure needs to rely on sound business purposes. However, some recent tax rulings from the Spanish tax authorities can be seen as attempts from the tax authorities to subject to wealth tax non-resident entities when their main assets are Spanish real estate assets.

Additionally, Spanish law regulates different real estate investment vehicles, such as SOCIMIs (Sociedades Anónimas Cotizadasde Inversión Inmobiliaria) (listed corporations investing in the real estate market) and SIIs (Sociedad de Inversión Inmobiliaria) (regulated collective investment vehicles), which have advantageous tax regimes. In general terms, they are collective investment schemes or listed companies and, therefore, their use must be analysed on a case-by-case basis.

Taxes on overseas real estate and other assets

13. How are residents in your jurisdiction with real estate or other assets overseas taxed?

Spanish residents are taxed on their worldwide income and, therefore, on any income derived from foreign assets. For real estate held overseas that is not the primary residence, a deemed income of 1.1% is subject to taxation, calculated on 50% of the acquisition cost of the asset.

Spanish residents are also subject to wealth tax on their worldwide wealth.

Additionally, Spanish residents are taxed on any asset they inherit or are gifted, regardless of where they are located.

International tax treaties

14. Is your jurisdiction a party to many double tax treaties with other jurisdictions?

Spain has one of the largest tax treaty networks in the world, with 102 signed double tax treaties (DTAs), 93 of which are currently in force. These include treaties with China, the UK and the US, which is currently pending approval of an amendment. Additionally, Spain has DTAs in force with a majority of the Latin American countries, including, among others, Argentina, Brazil, Chile, Colombia, Costa Rica, Cuba, Mexico, Uruguay and Venezuela.

Spain also has three tax treaties for the avoidance of double taxation regarding inheritances with France, Greece and Sweden.


Wills and estate administration

Governing law and formalities

15. Is it essential for an owner of assets in your jurisdiction to make a will in your jurisdiction? Does the will have to be governed by the laws of your jurisdiction?

In Spain, it is not essential for an owner of assets to make a will. Foreign wills are valid and enforceable, subject to specific formalities. However, it is advisable to execute a Spanish will for Spanish assets. Foreign wills must be translated into Spanish and legalised before a Spanish consul (or affixed with an apostille in countries signatory to the Apostille Convention).

Spanish conflict rules provide that successions must be governed by the national law of the deceased at the time of death. This establishes renvoi to the deceased's national rules. Therefore, if a will is made, succession is governed by the testator's national law. Additionally, any further referral set by a foreign law is not accepted unless it provides for the application of Spanish law.

The formalities applicable to any such will are governed either by Spanish law or the law applicable to the content of the will, that is, its national law (see above).

Regulation (EU) 650/2012 on jurisdiction, applicable law, recognition and enforcement of decisions and acceptance and enforcement of authentic instruments in matters of succession and on the creation of a European Certificate of Succession (Succession Regulation) changed the Spanish conflict of law rule on this matter. From 17 August 2015, successions are governed by the law of the last residence of the deceased, unless he made a will according to his national law.

16. What are the formalities for making a will in your jurisdiction? Do they vary depending on the nationality, residence and/or domicile of the testator?

The law applicable to succession determines the formalities for making a will.

Within Spanish jurisdiction there are different regional regulations, which apply depending on the testator's civil residence (vecindad civil). Where regional regulations do not apply, formalities for making a will are set out in the Spanish Civil Code.

Under the Spanish Civil Code, the formalities for making a will are the following:

  • All wills must give proof of the testator's identity and capacity to testate.

  • Only sane people over 14 years of age can testate.

  • A will is a strictly personal act that cannot be delegated; joint wills are forbidden.

In addition, wills take different forms, each of which requires the above formalities:

  • Open will. A will is open if the testator declares his last will in the presence of a notary public who is aware of the dispositions made.

  • Closed will. A will is closed if the testator, without revealing his last will, declares that it is contained in the document presented to a notary public.

  • Holographic will. A will is holographic when entirely handwritten by the testator.

There are further special wills (for example, military wills), but they are rarely used.

Redirecting entitlements

17. What rules apply if beneficiaries redirect their entitlements?

Beneficiaries are not allowed to redirect their entitlements. However, beneficiaries can waive their rights in favour of a third person, which may be considered a gift for civil and tax purposes.

Beneficiaries, after accepting their share to a succession, can dispose of it freely unless the testator imposed specific conditions or limitations they must fulfil.

Validity of foreign wills and foreign grants of probate

18. To what extent are wills made in another jurisdiction recognised as valid/enforced in your jurisdiction? Does your jurisdiction recognise a foreign grant of probate (or its equivalent) or are further formalities required?

Validity of foreign wills

Valid foreign wills are generally accepted in Spain (see Question 15). However, to be enforced within Spanish jurisdiction, foreign wills must be legalised before a Spanish consul (or affixed with an apostille in countries signatory to the Apostille Convention) and translated into Spanish.

Validity of foreign grants of probate

Grants of probate do not have an equivalent within Spanish jurisdiction. However, valid foreign grants of probate are assimilated to the appointment of a succession's executor.

To be enforced in Spain, foreign grants of probate must be legalised (or affixed with an apostille, within countries signatory to the Apostille Convention) and translated into Spanish.

Death of foreign nationals

19. Are there any relevant practical estate administration issues if foreign nationals die in your jurisdiction?

Foreign nationals and Spanish nationals are treated alike in estate administration issues.

Spanish courts are competent to decide on succession matters if the deceased's last domicile was located in Spain.

Administering the estate

20. Who is responsible for administering the estate and in whom does it initially vest?

Responsibility for administering

The deceased can appoint one or several executors by will. If no appointment is made, administration is vested in heirs.

The executor/heir acts as representative of the estate to preserve the estate until inheritance is distributed according to the testators' instructions.

The executor is responsible to the heirs and legatees for the proper administration of the estate.


The estate vests in the heirs if no executor is appointed (see above, Responsibility for administering). The testator can establish by will the extent and powers of the executor and in this case the deceased estate automatically vests in the executor. If not specified in the will, the executor must:

  • Decide on and pay for as provided by the will any religious services and the testator's funeral.

  • Pay legacies consisting of cash, with the heirs' knowledge and approval.

  • Supervise the performance of all other mandates contained in the will, and uphold the will's validity in and out of court.

  • Take the necessary precautions for the preservation and custody of the property, with the intervention of the heirs who are present.

21. What is the procedure on death in your jurisdiction for tax and other purposes in relation to:
  • Establishing title and gathering in assets (including any particular considerations for non-resident executors)?

  • Paying taxes?

  • Distributing?

Establishing title and gathering in assets

A list of all the assets comprising the estate must be prepared. Generally, a deed of acceptance must be executed before a public notary.

Procedure for paying taxes

Heirs and other legatees are the taxpayers and, as such, must file a tax return (self-assessment) or a declaration for the tax authorities to determine the tax due. If this obligation is not met, the transfer of the title to the assets cannot be registered with the relevant public registry.

Distributing the estate

All parties should agree on the distribution of the assets. If not, proceedings will commence for the court to determine the final distribution of the assets.

It is advisable to accept and distribute the estate within six months after the testator's death to comply with the six-month term to pay inheritance tax (an extension can be requested), and avoid taxation issues arising from a division in a situation of co-ownership among heirs.

22. Are there any time limits/restrictions/valuation issues that are particularly relevant to an estate with an element in another jurisdiction?

Assuming Spanish law applies, its rules will refer to the estate of the deceased as a whole, irrespective of its location.

23. Is it possible for a beneficiary to challenge a will/the executors/the administrators?

Anyone with a legitimate interest in the testator's estate is entitled to challenge a will. This will result in judicial proceedings seeking to do any of the following:

  • Annul the will.

  • Challenge the distribution of the estate made by heirs/executors.

  • Obtain a supplementary share of the estate, in the case of forced heirs.

Only forced heirs are entitled to challenge a will in the case they were unlawfully excluded from the will.


Succession regimes

24. What is the succession regime in your jurisdiction (for example, is there a forced heirship regime)?

The Spanish Civil Code provides for a common succession regime. This applies where no regional regulations exist (Catalonia and Navarra, among other regions, have their own succession rules).

Under the Spanish Civil Code, relatives are qualified as forced heirs in the following terms:

  • Children and issue are entitled to inherit two-thirds of the succession's assets, in respect of their parents and ascendants. Each will receive an equal share. However, the testator can benefit one child with one of the two-thirds (tercio de mejora).

  • In the absence of the foregoing, parents and ascendants are entitled to inherit one-half of the succession's assets, in respect of their children and descendants.

  • The surviving spouse has the following forced heirship rights:

    • if they concur with children or issue, they will inherit usufruct over one-third of the estate;

    • if they concur with parents or ascendants, they will inherit usufruct over one-half of the estate;

    • if they do not concur with any of them, they will inherit usufruct over two-thirds of the estate.

Forced heirship rules vary considerably between regional and local systems.

Forced heirship regimes

25. What are the main characteristics of the forced heirship regime, if any, in your jurisdiction?

Avoiding the regime

The forced heirship regime cannot be avoided unless specific legal and very restrictive causes concur. However, Catalan law has eased the exclusion of forced heirs and Navarra only has a formal forced heirship, with no economic value. Private placement life insurance (insurance wrappers), in some situations, may be useful to avoid forced heirship rules. Under Spanish inheritance rules, the life insurance premium is not included in the assets to be inherited. Therefore, the payment of the life insurance premium is made independently of the forced heirs' rights, who are not allowed to such premiums for calculating their forced heirship.

Assets received by beneficiaries in other jurisdictions

Assets received by beneficiaries in other jurisdictions are taken into account to determine forced heirship rights. Under Spanish inheritance rules, the same applicable law must govern the entire succession. Therefore, Spanish rules, when applicable, take into account the worldwide assets of the deceased. The forced heirs can claim the inheritance of such assets and are entitled to bring any proceedings in protection of their rights. This also applies when assets are located abroad.

Mandatory or variable

Forced heirship rights are mandatory and cannot be altered during the testator's lifetime.

Real estate or other assets owned by foreign nationals

26. Are real estate or other assets owned by a foreign national subject to your succession laws or the laws of the foreign national's original country?

Spanish laws provide for a principle of unity of the law governing succession. Therefore, the entire succession is governed by the national law of the deceased at the time of death.

27. Do your courts apply the doctrine of renvoi in relation to succession to immovable property?

There are no special rules governing renvoi on the law applicable to immovable property. Spanish inheritance law has always been subject to the principle of unity of the succession, meaning that the same applicable law governs a succession as a whole.

However, Spanish courts cannot reject jurisdiction over real estate assets.



28. What different succession rules, if any, apply to the intestate?

In the case of intestacy, common Spanish civil law establishes the following order to inherit:

  • Children and issue. In the absence of one or several children, issue of the latter inherit alongside children.

  • In the absence of children and issue, parents inherit in equal shares. In the absence of both parents, the right to inherit passes on to the closest ascendants.

  • In the absence of the above, the spouse and collateral relatives inherit.

  • In the absence of relatives with a right to inherit, the state will inherit.

The order of beneficiaries varies depending on the regional regime (for example, in Catalonia, the spouse or partner inherits before the parents of the deceased).

29. Is it possible for beneficiaries to challenge the adequacy of their provision under the intestacy rules?

Any beneficiary is entitled to challenge the adequacy of their provision under intestacy rules. This requires judicial proceedings. Proceedings are brought before the private law court of the last domicile of the deceased. The Spanish procedural law provides specific rules for these claims.



30. Are trusts (or an alternative structure) recognised in your jurisdiction?

Type of trust and taxation

Spain has not ratified the Hague Convention on the Law of Trusts 1985. Under Spanish law, trusts are generally disregarded. Therefore, it is considered that the assets in trust are either owned by the settlor or, in certain cases, the beneficiary/ies of the trust.

Spanish tax legislation does not contain any provisions on the taxation of trusts and there is some uncertainty regarding their tax treatment. The only guidelines on the tax treatment of foreign trusts under Spanish tax law are found in a few tax rulings issued by the Spanish tax authorities.

In the most recent tax rulings,the tax authorities disregarded the existence of trusts under Spanish law and considered transactions involving trusts as transactions made directly between the settlor/s and beneficiaries. The tax rulings do not differentiate between a discretionary and non-discretionary trust, or a revocable and irrevocable trust.

Based on most tax rulings, distributions made by trusts to beneficiaries on the settlor's death are considered mortis causa transfers between the settlor and the beneficiaries. Accordingly, Spanish-resident beneficiaries are subject to inheritance and gift tax (IGT) on the value of the assets in trust/received. Non-resident beneficiaries in Spain are subject to IGT on the Spanish assets acquired or rights that can be exercised in Spain.

The tax rulings issued by the Spanish tax authorities are questionable. However, they at least provide guidance on how the Spanish tax authorities understand the use of trusts.

There is almost no case law on the tax treatment of trusts (see Questions 33 and 34).

Residence of trusts

See above, Type of trust and taxation.

31. Does your jurisdiction recognise trusts that are governed by another jurisdiction's laws and are created for foreign persons?

The Spanish Civil Code establishes that foreign legal institutions validly and effectively incorporated under the provisions of the relevant legal system are recognised under Spanish law, so long as they are not contrary to the Spanish public order. For example, the Spanish Supreme Court, in a resolution of 30 April 2008, appeared to consider that a mortis causa trust validly incorporated under the legal system applicable to the settlor can, in certain circumstances, be recognised by Spanish law, provided the claimant proves it is a valid institution under the foreign law applicable to it.

It appears that inter vivos trusts can be more difficult to accommodate within the Spanish legal system. The Spanish Constitution only recognises the right of incorporating a public foundation. Therefore, considering the traditional civil law perspective of protection of the creditors, it is challenging to recognise inter vivos trusts under Spanish law.

32. What are the tax consequences of trustees (for example, of an English trust) becoming resident in/leaving your jurisdiction?

The residence of the trustees should not affect the Spanish tax analysis of trusts (see Question 30).

However, trustees that become tax resident in Spain must file form 720 (informative form on assets abroad) if they are signatories of bank accounts and other financial assets outside Spain held by a trust with a Spanish settlor or, in some cases, beneficiaries. If trustees become non-Spanish tax residents, they are no longer subject to filing form 720 if they are signatories of a bank account or other financial assets abroad.

33. If your jurisdiction has its own trust law:
  • Does the law provide specifically for the creation of non-charitable purpose trusts?

  • Does the law restrict the perpetuity period within which gifts in trusts must vest, or the period during which income may be accumulated?

  • Can the trust document restrict the beneficiaries' rights to information about the trust?

Purpose trusts

There is no specific legislation on trusts.

Perpetuities and accumulations

See above, Purpose trusts.

Beneficiaries' rights to information

See above, Purpose trusts.

34. Does the law in your jurisdiction recognise claims against trust assets by the spouse/civil partner of a settlor or beneficiary on the dissolution of the marriage/partnership?

Due to the lack of any specific legislation on trusts, the approach of the Spanish courts to trusts is uncertain.

35. To what extent does the law of your jurisdiction allow trusts to be used to shelter assets from the creditors of a settlor or beneficiary?

Due to the lack of any specific legislation on trusts, the approach of the Spanish courts to trusts is uncertain.



36. Are charities recognised in your jurisdiction?

Spain recognises charities that generally take the form of a foundation or of certain types of associations. Foundations with public interest aims are recognised by the Spanish Constitution. In contrast, family foundations are not allowed under the current Foundations Act.

In Spain, there is no legal definition of charity. However, it is generally accepted that charities are entities that are not allowed to distribute their profits among founders, members of the board or specifically appointed beneficiaries. In terms of taxation, Act 49/2002 establishes a special tax regime applicable only to registered Spanish non-profit entities.

A foreign foundation receives the same tax benefits as Spanish foundations if it establishes a formal branch in Spain, registers it with the relevant public body, and meets the legal requirements for foundations under Spanish regulations. If the foreign foundation seeks private interests, it cannot apply for the special tax regime.

37. If charities are recognised in your jurisdiction, how can an individual donor set up a charity?

Spain has had a Foundations Act in force since 2002. This Act (Act 50/2002) is applicable to foundations acting in more than one Spanish autonomous region, and to Spanish foundations acting at international level.

Foundations acting in one autonomous region alone are subject to the laws in force in the autonomous region. Despite some differences between Spanish and regional laws, it is generally compulsory for a foundation to have a governing body made up of at least three members or trustees, who cannot be remunerated. However, they can be remunerated for any other professional services they provide to the foundation, when the founder has not expressly forbidden it, and it has been authorised by the protectorate (a public body that monitors foundations by controlling and reviewing them). As a general rule, a minimum number of assets is required to set up a foundation. When contributing money to a Spanish foundation, this amount is EUR30,000. Setting up a foundation also requires a public deed, including bye-laws of the future foundation, and approval by the public entity acting as protectorate. The foundation only achieves its own legal personality with the protectorate's final approval.

Foundations must submit their annual accounts to the protectorate. The protectorate reviews, approves and deposits them in the foundations register once it has examined and verified them, and the annual action plans have been fulfilled.

Additionally, a financial report, complying with information requirements regarding the foundation's activity must be submitted annually to the corresponding tax authorities.

38. What are the benefits for individuals when setting up charitable organisations?

Individuals are entitled to a tax credit of 75% of the value of the gift of up to EUR150 made to a charity that falls under the scope of Act 49/2002. Any amount exceeding EUR150 is entitled to a tax credit of 30%. In both cases, there is a limit of 10% of the donor's total liquid taxable income. Amounts exceeding 10% cannot be applied in the following taxable periods (that is, they cannot be carried forward).

In addition, the donor is exempt from taxation on the capital gain arising from the donated asset (other than cash).

Entities are entitled to a tax credit of 35% on all gifts (contributions) up to 10% of their taxable base. However, this expense is not tax deductible for corporation tax purposes. Amounts exceeding this limit can be used in tax periods ending in the immediate year and subsequent ten years.

In both cases (individuals and entities), the tax credit can be increased by an additional 5% if the donor has donated to the same charity the same or a higher amount each year in the previous three years.

Donations to foreign charities not established in Spain are not entitled to tax credits (Act 49/2002). However, donations to charities based in the EU may be entitled to tax credits according to several decisions of the European Court of Justice. In these cases, the foreign charity must comply with the requirements set out in Act 49/2002.


Ownership and familial relationships


39. What are the laws regarding co-ownership and how do they impact on taxes, succession and estate administration?

The law of marital property varies from region to region in Spain. The Spanish Civil Code provides rules for general co-ownership. Some territories also have specific legal regimes. There are relevant differences between marital co-ownership and ordinary co-ownership. However, they all acknowledge the principle of freedom of choice regarding the option of several systems.

Under the Civil Code (CC), spouses can agree before a notary public, in a public deed, any clauses, amendments or replacements to the financial arrangement governing a marriage (Article 1325, CC).

If there is no marital agreement, to determine the supplementary legal marital law between spouses, their nationality must be considered, or in the case of Spanish citizens, their place of residence. It must also be determined whether the marriage was held before or after 29 December 1978. If the marriage was held after this date, the CC establishes the following rules to determine the law applicable to the marriage:

  • The common law governing both spouses.

  • If the spouses are not governed by a common law, the law governing one spouse or the law governing the habitual residence of either, recognised by both in a certified document granted before the marriage, applies.

  • If there is no certified certificate, the law of the common habitual residence immediately subsequent to the marriage applies.

  • If there is no common habitual residence, the law of the place where the marriage was held applies.

Any subsequent change of residence does not alter the financial arrangement governing the marriage, although it may amend the financial arrangement applicable to the succession.

The CC establishes a supplementary legal system of joint ownership of property (Sociedad de Gananciales) (Article 1315, CC, regulated under Articles 1344 et seq, CC). This is the most common system applicable to married couples in Spain. The CC also regulates the separation of assets (separación de bienes) and gain sharing (participación en las ganancias) as conventional systems.

Under other regional (foral) civil regimes, the most common financial matrimonial regime between spouses is that of a community estate (comunidad de bienes). For example, in Galicia, there is a general reference to the common law system of the joint ownership of property. In Navarra, the supplementary legal system is called the Sociedad Conyugal de Conquistas (Conjugal Conquest Society), and in Aragon, it is the system of Comunidad Legal (legal community), which are both similar to the system of joint ownership of property under common law.

In the Basque Country, the provinces of Álava and Guipúzcoa also use a supplementary joint ownership of property system. The province of Vizcaya uses the supplementary legal system of joint ownership of property (in force in some municipalities no aforadas, including Bilbao) and the supplementary legal system of the Comunicación Foral de bienes (Regional Communication of Assets) (in force in the rest of the province or Tierra llana), which is a type of universal estate in which all assets are considered community property of the spouses, before or after the marriage, under any title.

In the Balearic Islands, Catalonia and Valencia, the separation of assets is used as a supplementary financial-matrimonial system.

Familial relationships

40. What matrimonial regimes in trust or succession law exist in your jurisdiction? Are the rights of cohabitees/civil partners in real estate or other assets protected by law?

The existing matrimonial regimes in Spain are community property, separation of assets and gain sharing (see Question 39). The supplementary matrimonial regime varies from region to region. However, the most widespread is the community property regime (Sociedad de Gananciales) (Article 1315, Civil Code).

In Spain, there is no national regulation for de facto couples, but there are different regional regulations on the matter. The effects are virtually identical to legislation regarding married couples, although no financial arrangement is established. The separation of assets is then maintained unless agreed otherwise. The applicable regulations for partners depend on the Spanish region where the partners are resident. While in some regions partners must be registered to acquire legal status, in others there is no such registry.

Regarding inheritance rights, for example, in Catalonia, partners have the same inheritance rights as spouses. Regarding the habitual abode, the surviving partner has the right to use the property for one year after the partner's death and to own its contents (furniture).

41. Is there a form of recognised relationship for same-sex couples and how are they treated for tax and succession purposes?

Same-sex couples can get married with the same rights as any other married couple. From a civil and tax perspective, same-sex couples receive the same treatment as different-sex couples, as they are spouses for all purposes (different from civil partners). Therefore, they can benefit from reduced tax rates or tax reliefs applicable in certain regions.

42. How are the following terms defined in law:
  • Married?

  • Divorced?

  • Adopted?

  • Legitimate?

  • Civil partnership?


The Civil Code (CC) does not provide a definition of marriage (or married person). The CC regulates the:

  • Requirements for getting married.

  • Rights and obligations of the spouses.

  • Valid forms of celebration.

  • Registration of the marriage.

  • Marriage annulment.

A marriage is the union between two capable people (of same or different sex) under certain legal forms from which rights and obligations are borne equally by both parties.

However, some regional regulations, for example in Catalonia, define marriage as a legal bond between two people that originates a life community in which the spouses must respect, be loyal to, and help each other.


Divorce is defined as one of two possible ways to dissolve a marriage (the other is the death of one spouse). A divorced person is a person that was married in the past and is capable of remarrying.


The CC does not provide a definition of adoption or adopted person. Adoption is a legal institution for the protection of underage children, according to which the same legal bond as that existing between parents and their biological children is borne between the adopted child and the adoptive parents, as the legal bond between the adopted child and his biological family has been extinguished (Article 178, CC).


Spanish legislation grants the same rights to all children and, therefore, it is irrelevant whether the child is legitimated.

Civil partnership

In Spain, there is no national regulation for de facto couples, but there are different regional regulations on the matter. Therefore, different definitions of civil partnership exist depending on the region.

According to Catalan regulations, for example, a civil partnership is formed by two people living together in a life community similar to marriage provided that:

  • They live together for more than two years.

  • They have a child.

  • They formalise their relationship in a public deed.


43. What rules apply during the period when an heir is a minor? Can a minor own assets and who can deal with those assets on the minor's behalf?

Minors are considered as such until they reach 18 years of age (legal age). There are several limitations relating to minors, including:

  • A person who is not of legal age has limited legal capacity.

  • When minors are determined as heirs, they can acquire possession over assets by any title (including through testamentary provisions). However, they require the assistance of their parents or guardians to use the rights linked to these assets (Article 443, Civil Code).

Even with their parents' or guardians' authorisation, minors cannot execute wills.

Minors can inherit and own assets, although the administration of the assets will be assumed by their parents or guardians. As a general rule, transfers of the minors' assets must be authorised by a court.


Capacity and power of attorney

44. What procedures apply when a person loses capacity? Does your jurisdiction recognise powers of attorney (or their equivalent) made under the law of other jurisdictions?


A person can only be declared incapable under a court judgment.

Persistent physical or mental illnesses, and deficiencies that prevent a person from governing himself are a cause for incapacity.

Court procedure

Anyone with a legitimate interest in another person's incapacity must request the court to rule on that person's capacity.

The declaration of incapacity can be requested by:

  • A person presumed incompetent.

  • A spouse or person in a de facto situation of a similar nature, such as cohabitees or civil partners.

  • The descendants, ascendants or siblings of the presumed incapacitated person.

Public authorities can also initiate incapacitation proceedings.

Powers of attorney

A power of attorney that meets the formal requirements established under the laws of the country where it was granted is considered valid in Spain, as long as the power of attorney is legalised by a Spanish consul or apostilled.


Proposals for reform

45. Are there any proposals to reform private client law in your jurisdiction?

The authors are not aware of any current proposals for reform. The Spanish tax laws were recently extensively modified (in force for tax years starting 1 January 2015).


Contributor profiles

Sonia Velasco, Partner

Cuatrecasas, Gonçalves Pereira

T +34 932 905 590
F +34 933 129 588

Professional qualifications. Spain, Lawyer

Areas of practice. Tax and wealth management.

Non-professional qualifications. Bachelor of Laws, Universitat de Barcelona, 1992; Master in Business Law, Universitat Pompeu Fabra, 1994; Master in Tax Consultancy and Management, ESADE, 1995

Recent transactions

  • Advising international clients (multinationals, venture capital and private equity entities) on acquisitions, disinvestments and restructurings.

  • Working closely with US and Canadian multinationals, and venture capital companies with investments in Spain and Latin America when based in Cuatrecasas, Gonçalves Pereira's New York office from 2006 to 2009.

  • Advising private clients in their wealth planning and succession planning.

Languages. Spanish, English

Professional associations/memberships. Secretary of the boards of directors of various international companies; member of the American Bar Association; member of the International Bar Association (IBA), 2013-2014 co-chair of the Tax Section; member of the Barcelona Bar Association; member of the Society of Trust and Estate Practitioners (STEP).


  • Comentarios al Impuesto sobre la Renta de no Residentes (Comments on Non-resident Income Tax), published by Civitas y Aranzadi in collaboration with Cuatrecasas, co-author.

  • The IBA Individual Tax and Private Client Committee's International Estate Planning Guide (Ed. International Bar Association), contributor.

  • Articles in specialised journals such as the US publication Tax Notes International ( and in major Spanish newspapers.

Iñigo Aguirrezabala, Partner

Cuatrecasas, Gonçalves Pereira

T +1 212 784 8800
F +1 212 758 1028

Professional qualifications. Spain, Lawyer

Areas of practice. Tax; wealth management; real estate; private equity.

Non-professional qualifications. Bachelor of Economic Law, Universidad de Deusto, 1999; Master in Tax Law, Universidad de Navarra, 2000

Recent transactions

  • Counsel to Spanish wealthy families on an ongoing basis.

  • Advising a high net-worth individual in moving his residence to Spain and determining the legal and tax implications of the assets held through an offshore trust and distributions.

  • Advising Spanish beneficiaries on US estates and trusts in relation to the inheritance and gift tax.

  • Advising private equity funds in their investments in Spanish companies or acquisition of assets in Spain, in the technology, real estate, retail and industrial sectors.

  • Advising in the sale of a Spanish holding company (ETVE) with investments in Latin America, in the energy sector.

  • Assisting a US entity in the defence of a tax claim made by Spanish authorities in relation to corporate income tax.

Languages. Spanish, English

Professional associations/memberships. Member of the Barcelona Bar Association; member of the American Bar Association (ABA); member of the International Fiscal Association US branch (IFA).


  • The IBA Individual Tax and Private Client Committee's International Estate Planning Guide (Ed. International Bar Association), contributor.

  • Articles in major Spanish newspapers.

Carlos Gomez Liguerre, Counsel

Cuatrecasas, Gonçalves Pereira

T +34 932 905 484
F +34 932 905 538

Professional qualifications. Associate Professor of Private Law, Universitat Pompeu Fabra (Barcelona, Spain); non-practising lawyer

Areas of practice. Private client; contract law; tort law.

Non-professional qualifications. Bachelor of Laws, Universitat Pompeu Fabra, 1996; PhD in Law, Universitat Pompeu Fabra, 2005; Bachelor of Business Administration, Universitat Internacional de Catalunya, 2006

Languages. Spanish, English, German

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