The Spanish property market remains in a state of flux. The regional government of the Comunidad Valenciana, under which the Costa Blanca falls, again opts for tax relief.
By now, many Flemish owners of a Spanish home already know about the reduction in transfer tax (ITP) and the increased exemption within wealth tax. From 2026, a third important benefit will be added: a significant reduction in inheritance and gift tax (Impuesto sobre Sucesiones y Donaciones - ISD) for a wider family circle.
For property owners in Dénia, Jávea, Moraira, Altea, Benidorm or Torrevieja, among others, this can have a significant impact on family estate planning.
What will change from 2026?
Spanish inheritance and gift tax is regulated regionally. This means that each autonomous region can introduce its own exemptions and rebates.
The Comunidad Valenciana will further extend tax benefits from 2026, not only for spouses and children, but also for other family members such as brothers, sisters, cousins, uncles and aunts.
This makes a big difference for those who want to keep their Spanish home within the family.
1. The existing 99% rebate will be retained for immediate family members
For transfers to:
- spouses;
- children and adopted children;
- parents;
A reduction of 99% on inheritance and gift tax.
This applies to both Spanish residents and non-residents from Belgium and the Netherlands who own property in Spain.
In practice, this means that straight line heirs often pay hardly any inheritance tax. This arrangement will be retained.
2. New tax reduction for wider family (group III)
The main change is in the so-called Group III, which include:
- siblings;
- cousins;
- uncles and aunts;
Until recently, these heirs fell back on the national rates, which are significantly higher and can reach over 34%, depending on the value of the estate and the applicable tax coefficients.
From 2026, this will change.
New discounts from June 2026
The Comunidad Valenciana is introducing a phased reduction:
- from 1 June 2026: 25% rebate on tax payable;
- from 1 June 2027: 50% rebate on tax payable;
For example, for those wishing to bequeath a flat on the Costa Blanca to a sibling, this could mean savings of many thousands of euros.
It also makes gifts during life significantly more tax-efficient.
Practical considerations for proper estate planning
The tax advantages are interesting, but only when they are applied correctly in legal terms. Spanish inheritance and gift planning always requires a combination of tax insight and legal precision.
1. A correct will remains essential
Lower taxes do not automatically mean a good legal settlement.
Thanks to the European Inheritance Law Regulation, it is important to explicitly stipulate in a Spanish will which inheritance law should apply.
Without a clear choice of law, Spanish inheritance law may become applicable, with potentially undesirable consequences for the division of the estate, the protection of children or the legitimate portion.
An existing testamentary arrangement therefore deserves regular legal scrutiny.
2. Giving during life can be more tax advantageous
Due to the new reductions for Group III, a gift during life may be more advantageous than a transfer via inheritance in some situations.
Nevertheless, additional taxes such as:
In addition, strict formal requirements apply in Spain. A donation must go through a Spanish notarial deed to be legally valid.
A preliminary simulation is therefore necessary to make the right choice.
3. Correct application of regional rules for non-residents
Non-residents can also enjoy the favourable scheme in the Comunidad Valenciana, but this requires a correct fiscal approach.
The application of regional benefits does not happen automatically. Proper tax representation and timely returns are essential.
In Spain, tax return deadlines are considerably shorter than in Belgium, so errors or tardiness quickly lead to penalties or loss of tax benefits.
Why specialised counselling is important
Cross-border inheritance law between Belgium and Spain remains complex.
The combination of:
- European Inheritance Regulation;
- Spanish inheritance and gift tax;
- regional tax benefits;
- wealth tax;
- tax returns as a non-resident.
necessitates specialised counselling.
Without proper coordination, there is a risk that:
- the wrong inheritance law is applied;
- heirs pay unexpectedly high taxes;
- tax benefits are lost;
- declaration deadlines are missed;
- fines and negligence interest arise.
Listen in advance to our podcast on succession planning in Spain.
How Confianz guides you through this
Confianz assists Flemish owners of Spanish real estate with their complete legal and tax planning.
We provide:
- analysis of existing wills
- correct choice of law under the European Succession Regulation
- simulations of inheritance and gift tax
- tax optimisation for non-residents
- guidance for Spanish gifts and inheritances
- correct declaration of wealth tax and inheritance tax
This way, we ensure that your Spanish assets are not only optimally protected from a tax point of view, but also legally correctly transferred to the next generation.
