joint names

[mijas bound]

Myself and my brother bought a house last year (in Spain)
We bought the house in his name only because of problems i was having at the time.

my questions are:

1 how much would it cost if we changed it to joint names?
2 what would happen if he died, with or without a will (he doesn't have one at present)
3 would it be better to leave the property in just his name and get a will naming me as the sole benficiary (he has no children but we have sister).

thanks in advance.

[Jool]

Option 3 is the cheapest and simplest so long as the Will made is valid in Spain unless the house is worth a lot of money in which case this may be cheaper than IHT..........

Option 1 will cost you the transfer taxes and notary costs etc..........say 10% you may get away with 8.5 if you don´t use a solicitor

Option 2 - lots of complicated hassle for you to prove you have a right to inherit your share of it based on your financial contribution, rest will follow inheritance law in Spain.

[mijas bound]

Thanks Jool,
the house is not worth a huge amount

if he names just one beneficiary, does it matter that he has siblings?? or is it only children who have a claim?

[julian]

with option 1 you only have to pay about 8.5% transfer tacs, costs etc on half the value of the house.

[mijas bound]

what would be the process if he died and left a will naming me as sole beneficiary??

would i still have to pay the transfer taxes etc and what would the approx costs be.
what is the threashold for inheritance tax in Spain

[Beachcomber]

In my opinion option 1 would be the cheapest and most expedient. Your brother sells half of the property to you. As Julian says, you would pay transfer tax on half of the declared value and your brother would pay 18% CGT on the difference between half of the original purchase value and the current transfer value.

You would not need a lawyer, just go to a notary and arrange everything. You may need a translator.

If your brother died naming you as sole beneficiary you would pay inheritance tax on the full amount.

[julian]

as your brother selling you his half is really a ficticious sale, then you only need to value the property at whatever the minimum is acceptable to junta/hacienda, which will kep all costs down.
the interesting bit will be when the notary has to state how the amount is paid by the buyer to the seller, putting cash would not be a good idea, so there would have to be a cheque involved for half the value of the property.