Acting as executor of a foreign estate while living in Spain

Key rules

• Liability: Living in Spain does not make you liable for a foreign estate; the law governing the estate decides your duties.
• Inheritance tax: The heirs owe any Spanish inheritance tax, not you as executor.
• Deadline: The inheritance tax return is due within six months of the death.
• Income tax: You do not owe IRPF on estate income unless you are also an heir.

Confirm the governing law, the six-month deadline and how they apply to your case with a Spanish tax adviser or the Agencia Tributaria before acting.

Does living in Spain change your role as executor?

No. Living in Spain does not make you liable for a foreign estate. Your duties and powers follow the law that governs the estate and your appointment, not where you live. That is usually the law of the country where the deceased last habitually lived. Start by confirming which country's law that is and what your appointment allows you to do.

Who owes Spanish inheritance tax?

The heirs owe it, not you. Whether Spanish inheritance tax applies depends on three things:

• where the deceased lived;
• where the heirs live;
• where the assets are, in particular whether any are in Spain.

If it applies, the return is due within six months of the death. As executor, make sure the heirs know this early. Do not leave it until the estate is nearly settled, because the clock runs from the date of death.

What about income the estate earns?

If you collect estate income in Spain, it belongs to the heirs. They declare it, and you act only as their representative. Pass the money on and keep records of what you collected and when.

You do not personally owe Spanish income tax (IRPF) on estate income unless you are also an heir. If you are an heir, you are taxed on your own share, as an heir and not as executor.

What to do in practice

1. Confirm the governing law and the limits of your appointment.
2. Check with the heirs whether Spanish inheritance tax applies, using the three tests above.
3. Tell the heirs the six-month deadline.
4. Keep a clear record of any income you receive in Spain and pass it on.
5. Get advice from a Spanish tax adviser or the Agencia Tributaria before you file or pay anything.

The timeline below sets out the same steps in order.

Timeline and deadlines

Deadlines when you act from Spain

• Find out which country's law governs the estate and your appointment as executor: before you start acting

• Work out whether Spanish inheritance tax applies, based on where the deceased lived, where the heirs live and where the assets are: early on, well before the filing deadline

• Make sure the heirs file the Spanish inheritance tax return, since the heirs owe it, not you as executor: within 6 months of the death Deadline: 6 months after the date of death.

• If you collect estate income in Spain, pass it to the heirs, who declare it, and act only as their representative: whenever you collect income during the administration