Stepchildren and inheritance tax in the Valencia region
When the time comes for your beneficiaries to inherit your estate, you should be aware that stepchildren fall into band 3 for inheritance tax whereas natural or adopted children fall into band 2.
The following is an example based upon an estate in the Valencian region, valued at 240,00€, being left to one child: STEPCHILDREN AND INHERITANCE TAX
A natural child will pay inheritance tax of: 208.70€
A stepchild will pay inheritance tax of: 84,828.50€
84,828.50€ represents 34% inheritance tax on the gift and each stepchild would pay this sort of % on their inheritance.
Clearly this is a significant difference and in order to mitigate this, all you have to do is “adopt’’ your stepchild.
This may sound nonsensical, given that your stepchildren could well have grown up children of their own, however, by so doing, you will be saving 1000s€ in inheritance tax.
Our legal team has a fluent English speaking family matters solicitor who is very experienced in organising these types of legal arrangements for our British stepparents who are resident in Spain.
The good news is, neither you or your stepchild/children will ever have to attend court as each court appearance is conducted by our solicitor, and they will complete all the paperwork required for you following either an initial face to face meeting with you (your step children are not required to attend this meeting) at our La Siesta office near Torrevieja or, if distance is an issue, a telephone consultation can be arranged.
The process takes 12 months to complete and will include adding each stepchild that you wish to adopt to your Padron and the fee per stepchild requiring adoption is 995€ + iva.
We would recommend, if you have not already done so, that you elect us as the executors of your Spanish estate within your Will so that the correct procedures can be guaranteed to be implemented which will ensure the above measures are honoured when the time comes and we would also definitely recommend that you put in place Priority Client Cover, which, among many benefits, not only reduces the fee for probate work, but also means, if you do decide to go through the adoption process in the future, we will be able to update your Will(s) FREE OF CHARGE to reflect the updated status of your current stepchildren
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