Prepare a Will for Each Country Where You Own Assets
WHY? It will make things a lot easier for your heirs. For your assets located in Spain, only a Spanish judge can transfer title of these assets to your heirs. The Spanish judge cannot dispose of your assets located in another country. This is true world wide. Judges can only touch assets located in the country or state where the judge is located.
FOREIGN WILL. If you submit a foreign will in Spain, it must be ‘authenticated’ by a Spanish Notary. This is a long and expensive process your heirs wll have to deal with.
WILL CONTENTS. The Spanish will must include all your assets located in Spain – property, bank accounts, mutual funds, etc., but nothing located outside of Spain. The will from your native country must contain all your assets located there. Both wills, of course, must comply with the respective laws.
Spain’s Ex-Pat Advantage
In transferring title of your Spanish assets to your heirs, you may direct that the Spanish judge apply the law of your native country instead of Spain’s law. Why is this important? Eliminate ‘compulsory heirs’.
SPANISH LAW. Catalunya, and most of Spain, have a legal concept called ‘compulsory heirs’. These heirs, normally family members, inherit certain assets no matter what. For example, if you own a flat in Barcelona where you live with your family, when you die your spouse gets 50% of the flat and your children, regardless of age, get 25%. Your will can’t prevent it.
YOUR COUNTRY’S LAW. Some countries and USA states allow ‘free disposition’ of assets. You can name any heir you want and none are ‘compulsory’. If this is the law in your home country or state, upon your request, Spain will apply it to your will.
A HYPOTHETICAL CASE
US citizen Sam is from California. He owns a flat in Barcelona where he lives with his wife. They have two adult children who do not live in Sam’s house, Jordi and Gemma. Sam wants to give his flat to Gemma only.
Spanish Will. In the will, Sam must write that he wants the law of his native country to apply. Thus, Spain will apply California’s law. California allows for free disposition of assets so 100% of the flat will go to Gemma. His wife and Jordi receive no interest. If Sam fails to direct that California law apply, then Spanish law applies and 50% of his flat goes to his wife and 25% is split evenly between his two children. Sam can give the rest (25%) to whoever he wants.
California Will. Sam also owns a house in California and wants to give it to Jordi. He will include the house in his USA will and it will transfer to Jordi. There is no need to put this house in his Spanish will as the Spanish judge can’t touch it.
Tax Consequences. For your Spanish will you’ll need a Spanish tas attorney to assist (abogado fiscal).
With two sets of law, Ex-Pats have a big advantage. Knowing how they apply, and the tax consequences, can be confusing.
Questions. I’m a USA-licensed attorney from California and have lived in Spain since 2001. I advise on wills for Ex-Pats from a variety of countries. I’m happy to answer your questions or refer you to a Spanish attorney if required. Mark Carr
664 665 365