Death

Information and questions about the Law in Spain and Andalucia.
Parilla
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Death

Postby Parilla » Mon Nov 15, 2010 7:09 pm

My apologies at the outset for this being not the most cheerful of topics, but whilst neither my wife nor I have any intention of boarding that 'plane for a long long time, we do need to make provision for such an event however far away it is.

Our bank accounts are in joint names and I am a bit concerned that several people have told me that if in Spain a death of one of the couple occurs and is registered, the bank accounts are immediately frozen. If true, that would place an intolerable burden on the one left at the worst time in their life, and not something either of us would wish on the other.

I normally know better than to take any notice of experts like "the bloke down the pub", but on this subject I can't help but get a bit out of kilter.

Anyone got some helpful info ?

Cheers,
Parilla

Jool
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Re: Death

Postby Jool » Mon Nov 15, 2010 7:23 pm

It is true so keep separate accounts OR ensure you maintain the presence of mind to empty joint accounts BEFORE reporting the death here in Spain. I think the former is better in case of accident with only one injured survivor.

El Cid
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Re: Death

Postby El Cid » Mon Nov 15, 2010 7:32 pm

As Jool says, just withdraw the money.

The banks have this problem all the time. Some people do not report the death for 4 years to avoid IHT!

Even if the account is frozen they will usually pay the standing orders.

Sid

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Re: Death

Postby Retro P » Mon Nov 15, 2010 8:41 pm

Jools and El Cid are both on the right track keep 10-15 grand in seperate personal accounts so that in the unfortunate event the that one of you dies unexpectedly you can still function financially till the will is settled.
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gerryh
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Re: Death

Postby gerryh » Mon Nov 15, 2010 8:53 pm

My bank manager here in Spain said it was quite simple. Open an account in your own name, transfer all the money from the joint account and then tell the bank manager that your partner has died.She offered to open an account in our own names for my wife and I there and then to save the survivor partner needing to do it after the other partner has died.
Cheers
Gerry
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Parilla
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Re: Death

Postby Parilla » Wed Nov 17, 2010 9:26 am

Thanks all, we clearly need to follow the advice and will be doing.

What a callous thing to do to someone who has just lost their other half !!!!!!!!!!!!!!!!!!!!!

Parilla

deidrev
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Re: Death

Postby deidrev » Wed Nov 17, 2010 4:20 pm

Callous indeed, as is making the surviving partner pay death duties on their share of the family home!
No-one ever tells you the extent of the taxes here and the pitfalls!
Where there's a will, there's a way!

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Re: Death

Postby Bongtrees » Wed Nov 17, 2010 5:12 pm

deidrev wrote:Callous indeed, as is making the surviving partner pay death duties on their share of the family home! No-one ever tells you the extent of the taxes here and the pitfalls!

After allowances, the majority of residents pay nothing.
In a time of universal deceit, telling the truth is a revolutionary act. George Orwell

Jool
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Re: Death

Postby Jool » Wed Nov 17, 2010 7:49 pm

Fiscal residents pay very little but it is vital you are a fiscal resident, I am not sure what happens if a non fiscal resident dies here and a fiscal resident inherits - Sid do you know? My OH simply refuses to listen and as he has to pay tax in the UK he refuses to do a tax return here playing helpless as he does not speak spanish.

El Cid
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Re: Death

Postby El Cid » Thu Nov 18, 2010 9:07 am

Jool wrote:Fiscal residents pay very little but it is vital you are a fiscal resident, I am not sure what happens if a non fiscal resident dies here and a fiscal resident inherits - Sid do you know? My OH simply refuses to listen and as he has to pay tax in the UK he refuses to do a tax return here playing helpless as he does not speak spanish.
For IHT there are national rules and local rules which apply in addition.

Under the state rules, the beneficiary gets an allowance of about €16k irrespective of the residency of either party.

The main national exemption is on the "habitual" residence of the deceased where 95% (up to a limit) can be excluded if the house is retained by the beneficiary for 10 years. This would not apply if the deceased was non resident as the house could not be considered the "habitual" residence.

If the deceased was resident but the beneficiary was non resident it wouldn't apply either as one condition is that the beneficiary must have been living in the same house for 2 years.

The special rules that apply in some Autonomous Regions are very complicated and differ from one region to another. Also, to get these allowances, the definition of "Habitual Residency" in that region is similar, but not necessarily the same as fiscal residency. In most cases these allowances would only apply if the deceased was "habitually resident" in that region (usually for 5 years) and in some cases the beneficiary must be similarly resident in the same region.

There may be some exceptions to this in some regions but it is extremely complicated and constantly changing. Professional advice is essential if you feel you may be affected.

Maybe David Searle will be able to add some further comments to clarify this.

Sid

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Re: Death

Postby Bongtrees » Thu Nov 18, 2010 10:34 am

Jool wrote:Fiscal residents pay very little but it is vital you are a fiscal resident, I am not sure what happens if a non fiscal resident dies here and a fiscal resident inherits - Sid do you know? My OH simply refuses to listen and as he has to pay tax in the UK he refuses to do a tax return here playing helpless as he does not speak spanish.
You have stated many times that you are not married and have not registered as a couple so one assumes that the tax liability of someone in your position will be greater than that of a married spouse?
In a time of universal deceit, telling the truth is a revolutionary act. George Orwell

El Cid
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Re: Death

Postby El Cid » Thu Nov 18, 2010 10:51 am

Bongtrees wrote:
You have stated many times that you are not married and have not registered as a couple so one assumes that the tax liability of someone in your position will be greater than that of a married spouse?
Beneficiaries who are unrelated to the deceased pay twice the normal rate of tax.

They also do not get the standard allowance of €16k so the whole of the inheritance is taxed.

Couples who have registered as "Parecho de Hecho" are still treated as unrelated unless they habitually live in Andalucia, Cataluya, Islas Baleares or Islas Canarias.

Sid

Bongtrees
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Re: Death

Postby Bongtrees » Thu Nov 18, 2010 1:12 pm

El Cid wrote:
Beneficiaries who are unrelated to the deceased pay twice the normal rate of tax.

They also do not get the standard allowance of €16k so the whole of the inheritance is taxed.

Couples who have registered as "Parecho de Hecho" are still treated as unrelated unless they habitually live in Andalucia, Cataluya, Islas Baleares or Islas Canarias.Sid
Thanks Sid for clarifying that.

No wonder so many Brits know the words and actions to the Beyonce song when things go wrong between unmarried couples :)
In a time of universal deceit, telling the truth is a revolutionary act. George Orwell

Jool
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Re: Death

Postby Jool » Thu Nov 18, 2010 5:25 pm

Thank you Sid -

Bong, we have done everything re Pareja de Hecha apart from last stage at Consulate, still need to clarify exactly what that is........

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Re: Death

Postby mhic » Thu Nov 18, 2010 6:00 pm

I thought it was living in sin, hellfire and damnation!!!!! as that nice Mr Paisley would say.

Mhic.


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