Inheriting Property in the Balearic Islands: Succession Rules for Foreign Owners

Short answer: if you own property in the Balearic Islands, the law that decides who inherits it depends mainly on where you were habitually resident when you died, unless you chose the law of your nationality in your will. Inheritance tax is paid by each heir, not by the estate, and the Balearic Islands currently give very favourable treatment to spouses, children and parents. Heirs have six months to deal with the tax, so planning ahead with a Spanish will saves time and cost.

This is general information, not legal or tax advice. Succession involving more than one country should always be reviewed by a specialist.

Which country’s law decides who inherits?

Since 17 August 2015, the EU Succession Regulation (Regulation 650/2012) applies in Spain. As a general rule, the whole estate, including Spanish property, is governed by the law of the country where the deceased was habitually resident at death.

The Regulation also lets you choose the law of your nationality in your will. A British, German or American owner living in Mallorca can therefore choose their national law to govern their estate, which often gives more freedom than Spanish rules.

Forced heirship under Spanish law

If Spanish law applies, it limits your freedom to leave assets to whoever you wish. A portion of the estate, the legítima, is reserved for certain relatives, mainly children and, failing them, parents, with rights for the surviving spouse. Spain also has regional civil-law systems, including the Balearic Islands’ own rules, which can apply to people with Spanish regional civil status. Your lawyer will confirm which rules apply to you.

Inheritance tax in the Balearic Islands

• Who pays: each beneficiary pays tax on what they receive; the estate itself is not taxed.
• Which rules: Spain sets a national framework and each region sets its own reductions and allowances.
• Non-residents: following EU case law, non-resident heirs can generally apply the regional rules of the region where the property is located.
• Close family: the Balearic Islands currently apply a 100% tax credit for heirs in groups I and II (children, descendants, spouse and parents), which substantially reduces or eliminates the tax for close family.
• Other heirs: siblings, nephews, nieces and unrelated heirs pay at higher effective rates.

Tax rules change frequently. Check the current position with a tax adviser when the inheritance arises. See our guide to inheritance tax and wills in Spain.

Steps to inherit a property in Spain

1. Obtain the death certificate and, if the deceased died abroad, have it legalised or apostilled and translated.
2. Get the certificate of last wills from the Spanish Registry of Last Wills to find out whether there is a Spanish will.
3. Obtain NIE numbers for all heirs.
4. Sign the deed of acceptance of inheritance before a Spanish notary.
5. Pay inheritance tax within six months of death (an extension may be requested within the first five months), and the municipal plusvalía tax where applicable.
6. Register the property in the heirs’ names at the Land Registry.

Heirs can also refuse an inheritance, which may make sense if the debts exceed the assets, or accept it subject to an inventory to limit their liability.

Planning ahead: why a Spanish will helps

A separate Spanish will covering your Spanish assets is usually quicker for your heirs to use, because it is already in Spanish form and registered. It should be drafted to work alongside your will in your home country, with a clear choice of law where appropriate. Spouses who own a property together should also consider how ownership is split, since this affects both inheritance and tax.

Frequently asked questions

Do I need a Spanish will if I already have one at home?

It is not compulsory, but it usually makes the process faster and cheaper for your heirs. Make sure the two wills do not contradict or revoke each other.

Can I leave my Mallorca property to whoever I want?

If your national law allows it and you choose that law in your will, often yes. If Spanish law applies, forced heirship rules may limit your freedom.

How long do heirs have to pay inheritance tax in Spain?

Six months from the date of death, with the possibility of requesting a six-month extension within the first five months.

Sophie

Sophie Gutenberg is a legal content specialist focused on Spanish property law, real estate transactions, conveyancing, due diligence and tax issues affecting international property buyers in Spain. She works alongside qualified Spanish property lawyers .