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Making a Will in Spain
This guide is, of necessity, both brief and general and is therefore no substitute for proper professional advice, which we will be happy to provide on request.
Owners of property in Spain need special advice when making an English will and must consider whether to make a separate Spanish will.
Do I actually need to make a Spanish will?
No. There are, however, good reasons for doing so. Although your English will — if you have one — will probably be recognised as valid by the Spanish authorities, the cost of having it recognised is usually far greater than the cost of dealing with a "proper" Spanish will. In addition, you may want to make some quite complicated arrangements in your English will. These may simply not be appropriate in the case of what are often a limited number of assets located in Spain. Worse still, they may lead to considerable extra tax being payable in Spain — tax that could possibly be eliminated completely by the preparation of a suitable Spanish will.
The Problems when making an English will
You may already have made a Spanish will dealing with your assets in Spain. Unless you are asked about this when you make an English will there is a great danger that a standard clause may be pulled off the computer, revoking not only your pre-existing English wills but also your earlier Spanish will. The consequences of this can be expensive!
Equally, if you are not asked about Spanish property, then an entirely inappropriate English will can be drafted, again causing you or your beneficiaries considerable loss.
If you choose not to make a will at all, relying on the intestacy provisions, even worse consequences can follow.
Inappropriate English wills
If an existing Spanish will is not to be revoked it is vital that the English will does not attempt to deal with the property located in Spain and so effect a double — and possibly inconsistent — disposal of the same assets.
Inheritance in Spain does not normally require the intervention of an executor. Legal title passes directly to the beneficiaries. An English will may provide for the appointment of executors & trustees to whom the estate is given "on trust to......". Spanish law has no concept of a trust (except than in very limited circumstances) and so such a provision may be treated as a gift to the Trustees. Such a gift is likely to result in far higher taxes being paid than if the house were to be given directly to the likely beneficiaries under the trust — the wife and children. This is particularly so if the Trustee is a bank or solicitor as gifts to non-family are taxed at a much higher rate. In the case of a gift of a typical £50,000 house, the difference is that, if given to a wife and 3 children, the gift would be tax free whereas a gift to a solicitor trustee would result in tax being paid on the entire gift — and at double the rate that would have been charged to a family member. Worse still, the trustee would presumably then wish to transfer title by way of gift to the wife and children. This transaction, too, would be taxable — and also incur legal costs. The gift being a gift by the trustee owner to somebody not a member of his own family would again attract the higher rate of tax. The combined total of these taxes and charges could consume a large part of the value of the house!
Although the English will should be recognised in Spain it is not a cheap process. One cost is the expense of an official translation of several documents including the grant of probate. A huge word processed will can cost £500 or more to translate. The result can be an overall bill totally out of proportion to the value of the house in Spain. If there is to be an English will for use in Spain it should, therefore, be short, simple and take into account Spanish law. Better still in most cases is to make a separate Spanish will and register it in Spain. This can be done either in this country or in Spain.
Why should I make a separate Spanish will?
Apart from eliminating the risks mentioned above, the existence of a Spanish will usually makes it much quicker to deal with your affairs in Spain. If you rely on an English will no action can be taken until the probate of your English estate has been dealt with. This can take some time — particularly if your English will or affairs are complicated.
The Spanish authorities impose tax penalties if matters are not dealt with quickly. You have only 6 months (in certain cases extendable to 12 months) to pay the taxes due on the Spanish estate, failing which a surcharge of 20% will be applied and interest will start clocking up. It is rare for the English probate to be dealt with in time to allow this deadline to be met.
How do I make a separate Spanish will?
Spanish wills — i.e. a will in Spanish drafted in accordance with the Spanish formalities — usually need to be signed in front of a Notary Public and then registered in the Spanish wills registry in Madrid.
There are three main ways in which we can arrange this for you. You should choose the one that is most convenient for you.
Sign the will in London
We can arrange for you to make a Spanish will in London. We prepare the will and send it to a specialist Notary Public who is familiar with the necessary Spanish formalities. You travel to London to sign the will. Once you have done so we make arrangements for it to be registered in Spain. Unfortunately, the only place where such specialist notaries are available is in London.
There are a number of advantages to making the will in this way. It is, generally, the way we would recommend — although we understand the inconvenience and cost which may be caused by travelling to London.
The advantages are that the will is made in a way entirely consistent with the Spanish method of making a will and so will almost certainly be accepted without question as being in valid form. We draft the will and we can therefore ensure that it meets your requirements before you sign it. This is often not possible where wills are signed in Spain. The cost of coming to London is likely to be less than the cost of travelling to Spain and the visit can often be arranged to allow you to do something else at the same time — even if it is only shopping!!
Sign the will in front of a Notary near where you live
Most towns have a Notary Public. We can arrange for your will to be signed in front of any notary who is prepared to undertake this work. The major difference, compared to signing in London, is that the notary is most unlikely to speak fluent Spanish — in which case an official translator will be needed — and he is also most unlikely to work in the same way as a Spanish Notary. This can cause complications, and thus extra cost, both when you make the will and when the time comes to give effect to the will. Although this appears an attractive option, in reality the extra complications introduced mean that if it is at all possible for you to travel it is probably better for you to make your will either in London or in Spain.
Sign the will in Spain
If you are planning to visit Spain — perhaps on holiday — we can arrange for a Notary in Spain to prepare a will for signature and register it with the authorities. The drawbacks of this method are that, although we will tell the notary exactly what you want to say in your will, we will usually not be able to check the document before you sign it and, of course, you may not be planning to go to Spain or want to spend a significant part of your holiday in a Notary's office.
What should I put in my Spanish will?
That is up to you. You can say what you want. Remember, however, that in Spain certain people — mainly your husband/wife and children — will have certain semi-automatic rights in respect of your estate. These should, if possible, be respected. It is cheaper this way. If you want to make any complex arrangements or to leave assets to people who are not members of your family, it is generally better to do so in your English will and to make your Spanish will as simple as possible.
We will be happy to advise on the best structure in more detail once we know more about your circumstances.
What if I cant make a Spanish will for some reason?
We can prepare a normal English will drafted in such a way as to make the task of dealing with your inheritance in Spain as cheap and simple as possible. This can either be your main or only English will or a separate English will dealing only or mainly with your assets in Spain.
What does it all cost?
Our standard fee for the preparation of a straightforward Spanish will is £250. On top of this you will have to pay VAT and any sums which we have to pay out on your behalf. These will normally include the costs of the Notary in front of whom you sign the will (which will vary from notary to notary and dependent upon whether a translator is needed), the cost of certifying the Notary's signature for use overseas (currently £19 plus, in urgent cases, the cost of a courier to save postal delays — about £80).
Complex wills and advise as to the best way of dealing with your estate are charged for on the basis of our standard hourly charging rates as set out in our letter to you.
English wills, drafted with particular reference to the requirements of Spanish law, cost £150 + VAT.
Where two people who jointly own a property wish to make wills containing essentially the same terms, the second will is charged for at half the price of the first.
What happens if I do not make a will of any kind? - The Risks of Intestacy
Under Spanish law your share of property you own jointly with somebody else does not pass automatically to that other person on your death. It will be disposed of either in accordance with your will or, if there is no will, under the laws relating to intestacy.
These can produce quite unexpected results.
What do I do next?
If you would like more information, please contact:
The International Law Partnership LLP
Solicitors & International Lawyers
Holborn Hall
193-197 High Holborn
London
WC1V 7BD
Tel: 020 7420 0400
Fax: 020 7836 3626
Email: info@LawOverseas.com
Internet: www.LawOverseas.com
© The International Law Partnership – August 2006
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