Revision to Inheritance Tax Law Could See 30,000 Brits Compensated

Revision to Inheritance Tax Law Could See 30,000 Brits Compensated

Thousands of Expats can claim Compensation so speak

with the experts at Costa Del Sol Property Group

Spanish authorities could soon compensate thousands of Brits who were taxed unfairly. The European Court of Justice ruled last year that Brits who inherited a Spanish holiday home between 2011 and 2014 were charged a high rate of Inheritance Tax (IHT). Thousands of Brits may now be eligible to claim back these excessive charges authorities forced them to pay.

It’s estimated that the charges that were ruled to be unfair and illegal were applied to 30,000 Brits. At the time of inheritance they were classed as non-residents in Spain. Even spouses of deceased property owners who spent over half of the calendar year residing in Spain were erroneously categorised like this.

EU rulings mean that Spain has been now been forced to change their IHT laws that would previously levy punitive charges (some of which could reach as high as a third of the value of the property) in the event that a home was inherited by a non-resident EU citizen.

The changes in the law mean that legal proceedings have started to reclaim back the money paid to the Spanish tax authorities. Even so experts believe that it won’t be so simple to claim back the money. Right now the compensation procedure has not officially begun, though the Spanish government has created a five-year window that claims could be made in.

Spanish legal experts say that it could take six to eight months for a claim to be filed and compensation to reach the claimant. Many Brits would consider this wait worth it; the previous IHT laws saw Spanish residents become exempt from as much as 99% of IHT, while people who were deemed to be non-residents had to foot the entire bill; which could work out as being up to a third of the value of the property.

Spanish authorities demanded that IHT be paid within six months of inheriting the property. The British were the hardest hit by these charges because they are the largest group of foreign property-owners in Spain. The changes to the law were introduced in September 2014. It took a while but it looks like Spanish authorities have begun to get the ball rolling. It looks like the average repayment will be around €25,000.

Spanish authorities have conceded that non-residents who inherited a Spanish property within the past four-and-a-half years are eligible to claim back their taxes, but Expat homeowners in Spain only have one chance to lodge their bids for compensation.

If you  think you have been over charged then speak with Costa Del Sol Property Group today and claim your money back.