🗺️ Inheritance Tax in Spain 2026: How Much You Pay in Each Region

Inheriting does not cost the same everywhere in Spain. Inheritance tax is a state tax, but it is ceded to the autonomous regions, which set their own reductions and reliefs. As a result, two families receiving the same inheritance can pay very different amounts depending on where the deceased lived.

At Ruiz & Asociados we review how the tax works in 2026 in the regions where we work most, which deadlines apply and what to check before accepting an inheritance or planning your company’s succession.

📍 Which region decides how much you pay?

It doesn’t matter where the heirs live or where the assets are: inheritances are taxed under the rules of the region where the deceased had their habitual residence, meaning the region where they spent the most days during the five years before their death.

When the deceased or the heirs are not resident in Spain, regional rules can often still apply, but each case should be reviewed carefully. Find out more on our international taxation page.

📊 Inheritance tax: what children and spouses pay in 2026

Close family members (children, spouses and parents) benefit most from regional reliefs. This is the picture in the regions we serve:

Region	Children and spouse	Worth knowing
Andalusia	€1 million reduction per heir and 99% relief	For most family inheritances the tax is practically zero.
Madrid Region	99% relief	Siblings, uncles, aunts and nephews also get partial relief.
Catalonia	99% relief for spouses and a decreasing relief for children	One of the regions where close family may pay the most.
Valencian Community	99% relief	Siblings, uncles, aunts and nephews: 25% from June 2026 and 50% from June 2027.
Balearic Islands	100% relief	Collateral relatives get 60% or 35% relief depending on the case.
Canary Islands	99.9% relief	Close family members pay almost nothing.
Biscay (Basque Country)	Its own foral rules, with very low taxation	The Biscay Foral Law applies, not the state law.

Reliefs apply to the tax due and may have additional requirements or limits, so they should be reviewed case by case.

👨‍👩‍👧 What if siblings, nephews or non-relatives inherit?

The big reliefs are usually limited to close family. Siblings, nephews, uncles, aunts or non-relatives apply much smaller reductions and higher rates, and the tax is increased by multipliers based on the heir’s existing wealth. In these cases the bill can be very high, which is why planning during your lifetime is key.

🏢 Family businesses and the main home

On top of the reliefs, state law provides a 95% reduction on the value of a family business or shares in it, provided the activity, shareholding and management requirements are met and the heir keeps what they inherit for the required period (ten years under state law, less in some regions). There is also a reduction for the deceased’s main home.

If you are planning your business handover, read our guide on family protocols and business succession.

⏳ Filing deadlines

• The general deadline is six months from the date of death.
• You can request a further six-month extension, as long as you apply within the first five months.
• Late filing carries surcharges and interest.

Even if the relief brings the tax down to zero, you still have to file the return to apply it.

✅ What to check before accepting an inheritance

• The deceased’s region of residence over the previous five years.
• The reference value of any property, which the Tax Agency uses as a minimum value.
• Any debts, to consider accepting with the benefit of inventory.
• Whether there is a family business or shares that qualify for the 95% reduction.
• The municipal capital gains tax on property, paid separately to the town hall.

You can check the state rules in Law 29/1987 on Inheritance and Gift Tax published in the Spanish Official Gazette. Figures based on the rules in force in November 2026; every case needs its own review.

🧮 How inheritance tax is calculated, step by step

Although each region applies its own advantages, the calculation follows the same structure across the common territory. Understanding it helps you see where savings are possible and what paperwork to prepare:

1. Value of the inherited assets. Property, accounts, investments, vehicles, company shares and household contents are added up, the latter initially calculated as 3% of the estate.
2. Debts and deductible expenses. Provable debts of the deceased, last illness and funeral costs, and other charges allowed by law are subtracted.
3. Tax base. The result is split among the heirs according to the will or the law, and each heir calculates their own tax.
4. Reductions. Reductions for kinship, disability, life insurance, main home or family business are applied. Regions can improve the state reductions or create their own.
5. Progressive scale. A scale ranging from 7.65% to 34% under state rules is applied to the net taxable base.
6. Multiplier. The tax is multiplied by a coefficient that depends on kinship and on the heir’s existing wealth.
7. Regional reliefs. Finally, the regional relief is deducted, which in many cases leaves the tax practically at zero for children and spouses.

This is why two heirs of the same estate may pay different amounts: the result depends on their relationship to the deceased, their age, their wealth and the specific assets each one receives.

💡 An example to understand the differences

Imagine a daughter inheriting a home and some savings from her father. If he lived in Andalusia, Madrid, the Valencian Community, the Balearic or the Canary Islands, she would normally pay very little or nothing, because reductions and reliefs for close family are very generous.

If the same estate goes to a nephew, or if the father lived in a region with more limited reliefs, the tax can be substantial. And if the heir already has significant wealth, the multiplier increases it further. That is why it is worth running the numbers with real data before assuming how much will be due.

🏠 What happens with an inherited home

The home is often the most valuable asset in an estate, and it has several tax implications:

• Reference value. Since 2022 the Spanish Tax Agency uses the Land Registry reference value as the minimum value for property. Declaring a lower value will most likely trigger a supplementary assessment.
• Main home reduction. If the spouse, descendants or certain relatives who lived with the deceased inherit, a reduction can be applied to the value of the main home, subject to holding requirements.
• Municipal capital gains tax. The town hall charges a tax on the increase in land value, with its own deadline: six months for inheritances, which can be extended.
• Later sale. If you sell the inherited home, the income tax gain is calculated from the value declared in the inheritance. Declaring too low a value can be costly later on.

🏦 Life insurance and bank accounts

Amounts received by the beneficiaries of a life insurance policy are also subject to inheritance tax, even though they are not part of the estate, and close relatives have a specific reduction. To find out whether the deceased held any policies, you request a certificate from the Register of Life Insurance Contracts together with the certificate of last wills.

As for accounts, banks usually freeze balances until the tax return has been filed. Many banks allow those funds to be used to pay the tax, which helps heirs who lack cash.

🎁 Is it better to give during your lifetime or wait for the inheritance?

Many regions also give relief on gifts between parents and children, although they often require extra conditions, such as formalising the gift before a notary or proving where the money came from. Giving during your lifetime can help with planning, but it has an often overlooked cost: the donor may have to pay income tax on the gain in the assets given away, which does not happen with inheritances.

There is an important exception for family businesses: a gift of shares that qualify for the 95% reduction does not create a taxable gain for the donor. That is why a planned gift is often a very useful tool in a business handover. Find out more in our article on family business succession.

🌍 Non-resident heirs or deceased

When the deceased or the heirs live outside Spain, the inheritance is still taxed here on assets located in Spain. In most cases the advantages of the relevant region can now be applied, which was not possible a few years ago. Heirs will need an NIE and, in some cases, will file with the state Tax Agency. If there are assets in other countries, their rules and any treaties must also be reviewed.

❓ Frequently asked questions about inheritance tax

Do I have to file if the tax comes out at zero?
Yes. Filing is required to apply the reductions and reliefs. If you don’t file, you lose the right to apply them and surcharges may follow.

What if I don’t have the money to pay it?
You can ask the bank to pay the tax from the deceased’s accounts, or request a deferral or instalment plan from the regional tax authority.

Can I renounce an inheritance?
Yes. The renunciation is formalised before a notary and, if it is outright, it is not taxable for the person renouncing. It is worth studying carefully when the estate carries debts.

Where is it filed?
With the tax authority of the relevant region, usually using form 650 and, in many cases, online.

📋 Documents you will need for inheritance tax

Gathering the paperwork from the start speeds up the process considerably and avoids surprises with deadlines. These are the usual documents:

• Death certificate and certificate of last wills.
• An authorised copy of the will or, if there is none, the declaration of heirs.
• Certificate from the Register of Life Insurance Contracts.
• Bank balance and investment certificates as at the date of death.
• Title deeds or land registry extracts for the property and its reference value.
• Documents for any debts and for funeral expenses.
• If there is a family business, the annual accounts and documents on the shareholding and management roles.

🗓️ Inheritance tax in Spain in 5 key points

1. The rules of the region where the deceased lived in the previous five years apply.
2. Children and spouses pay very little or nothing in most regions, but there are exceptions.
3. Siblings, nephews and non-relatives can pay much more.
4. Family businesses and the main home have significant reductions if the requirements are met.
5. You have six months to file, extendable to twelve if you request the extension in time, and you must file even if nothing is payable.

If you have doubts about how all this affects your family, it is best to review it in good time. Planning during your lifetime, with a will, gifts and a family protocol, can save your heirs a great deal of money and trouble.

⚠️ Common inheritance tax mistakes

• Missing the deadline because the tax is assumed to be zero. Reliefs only apply if the return is filed, and late filing brings surcharges.
• Declaring property below its reference value, which usually leads to a supplementary assessment with interest.
• Forgetting life insurance policies, which are taxed even though they are not part of the estate.
• Not checking the deceased’s region of residence over the previous five years, especially when they moved recently.
• Selling inherited assets without considering income tax, as the gain is calculated from the value declared in the inheritance.
• Leaving the family business without a plan, losing the 95% reduction because the requirements were not met at the time of death.

Most of these mistakes can be avoided with a review of the estate before filing. At our firm we prepare that review and calculate the tax for each heir, so the family can decide with all the information.

🏢 Ruiz & Asociados: inheritances and succession planning

At Ruiz & Asociados we handle the tax return, the valuation of assets and the planning so the inheritance reaches your family with the lowest possible tax burden, applying each region’s rules. 🤝

Do you have a pending inheritance or want to plan your company’s succession? Contact our firm and we’ll review it with no commitment. 🚀