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INHERITANCE TAX CHANGES: GOOD NEWS for those in the Valencia Region | Blacktower
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Oct 29, 2024
Christina Brady from @blacktowerfinancialmanagem7049 returned from the summer break with an update on the markets, pensions and investments, but also with news on changes to inheritance tax which affects those with properties or other assets in Spain's Valencia region. For any enquiries contact info@blacktowerfm FAO Christina or get in touch through the website: www.blacktowerfm.com Be sure to Like and Subscribe to our YouTube channel for more insights from BayRadio Spain, and follow us on Social Media: Website: http://www.bayradio.fm/ Facebook: https://www.facebook.com/BayRadioInSpain Instagram: https://www.instagram.com/bayradiospain/
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we specialize in protecting preserving
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and growing your wealth Black Tower
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financial management the team you want
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by your side visit blacktowerfm.com back
0:10
to Christina Brady from Black Tower
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financial management picking up today
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first one in a while we said we had more
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good news now this is if people are with
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the new Valencia region in Spain right
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it is just how these work because the
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autonomous is delightful news you can't
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wait to pass it on because the way
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things work is we know in Spain it's um
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within each autonomous region they can
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do their own thing on some things and
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this is one of them yeah what you have
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in Spain is you have National Tax so
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that's the base like income tax and then
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regions can add their own on and they
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can decide what they do with wealth tax
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uh succession tax which we know is
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inheritance tax and what happened is we
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know we had a change in government in
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the Valencia region we got rid of the
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Socialists and so
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um what that part of their Manifesto is
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that they were going to reduce taxes
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where they could so on the 21st of July
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the Valencia government made a very very
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bold move and it approved to suppress
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inheritance tax in the Valencia region
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uh go and they've backdated it to the
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28th of May 23 so since then there's
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been no inheritance tax to be payable
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from people to either their children or
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their spouses so in Spain the under
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inherited sex rules you have four groups
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of people right group one is children
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grandchildren adopted children under 21.
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they always got the most allowance group
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two is children and adopted children
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over 21 grandparents and spouses group
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three is brothers sisters aunts and
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uncles and group four is non-related
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people cousins
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Etc so for groups one and two so that's
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for children spouses and obviously if
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you leave money to your parents their
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inheritance tax now has been suppressed
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and that makes a huge difference before
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in the Valencia region spouse to spouse
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you only got a hundred thousand Euros
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allowance before you had to pay
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inheritance tax
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and for most people if their properties
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were worth five hundred thousand in
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joint names
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obviously you were over that hundred
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thousand threshold and this doesn't just
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apply to beneficiaries who live in the
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EU
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it applies to beneficiaries no matter
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where they are in the world so it also
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applies to non-eu countries so that's
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countries like the US Canada Australia
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UK so if you have assets and you live in
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the Valencia regions you're a tax
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resident here you die and you leave your
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assets to one anyone in group one or two
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no matter where they are in the world
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they don't pay inheritance tax
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wow okay so no no not a limit on it it's
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just there's none at all yep and it's a
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huge huge huge difference we used to
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have a 99 it's basically a 99 discount
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and then that went down to 25 then it
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went down and 50 and the old socialist
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government said they were going to get
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the allowance down even more Charlie 25
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discount or zero the other government
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has come in now and said no why can't
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people leave what they've worked so hard
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for to their children now group three
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which is brother sisters aunts and
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uncles isn't included in this however it
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is expected that they will include this
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group within the next year or so it
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could be sooner than that now group four
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I'm afraid if you're not married you
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fall into group four if you're not
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related to someone leaving the money you
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fall into group four or if you're a
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distant family relative you fall into
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group four and therefore you have to pay
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the full brunt of inheritance tax as per
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the national rules there's no discount
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and it's horrendous so if you are not
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married and you do actually want to
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leave your partner something and avoid
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inheritance tax if it's gonna you know
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you need to consider possibly getting
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married
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um and if you have got money to leave
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and you don't want to pay inheritance
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tax obviously leave it to Children if
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you then want it to go on to other
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family members maybe you can put
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something in writing saying that they
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give something to other family members
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remember if they live in the UK and
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they've got money they gift it to
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someone they have to live for seven
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years otherwise that person will pay tax
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so there are ways around it but it is a
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huge huge move forward and a very very
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bold move and they also did say that
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they would look at wealth tax because
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wealth tax again is is her is is
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it can amount to a lot of money each
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year even if your assets aren't that big
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say you've got a house and it's
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increased in value you know you charge
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wolf tax and some people are asset rich
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and cash poor and it can have a huge
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effect on them so they're looking at
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wealth tax as well but for now Valencia
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region has come in line with other
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regions like Madrid Barcelona Murcia and
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the lyrics have done it as well
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um in the groups one and two inheritance
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tax has all but gone okay so people that
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were getting elderly and we're thinking
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of selling their house and they want you
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to downsize but for all no because of
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the inheritance implications and we're
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going into rented accommodation you can
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sell your big house now you can buy
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yourself a smaller house at the moment
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with no inheritance tax liabilities for
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your children and then you can invest
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the rest to give you an income obviously
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this remains in place as long as this
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government remains in place but
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hopefully if they make many more
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positive tax moves people will vote to
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keep them in place
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um if you look to what the Spanish
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people said prior to the election they
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were fed up being taxed to the hilt
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um they were fed up with the family
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values being attacked because in Spain
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obviously the value of the family very
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highly and they were attacking family
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values and so the Spanish people
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actually did something about it
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um they actually said look enough is
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enough we're going to change this so no
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central government
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is still a bit of a mess but Regional
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governments seem to have their act in
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order at the moment we've had change in
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local governments in lots of
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towns and cities as well and let's see
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if they do some positive stuff as well
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but that is absolutely brilliant for
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everyone out there and you know if
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anyone says to you it only applies to
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people that live in the EU that is
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incorrect it is across the board so if
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you live in Spain and you leave your
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money to the UK to someone in Australia
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someone in Canada I don't know someone
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in Indonesia Thailand wherever okay I'm
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still subject to the same rules as if
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they lived in Spain wow okay and it
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always seemed to be here I've said every
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time it's the old inheritance tax it's
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it's a rotten humbug tax that because
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it's you know it's their money it's
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their house
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but if you look at the UK the amount of
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extra I think I couldn't remember if it
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was the first three months of this year
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they bought in something an extra 5
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billion in inheritance tax in the UK
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because in the UK spouse's spouse is
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free but then you leave it to anyone
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else it's not and if you go over your
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allowance it's taxed at 40 and for most
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people their houses are over that
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allowance so it gives them no leeway to
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leave anything else so in the UK you do
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need to look at trusts Etc to alleviate
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inheritance tax obviously trusts are not
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acceptable anywhere in Europe or France
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Spain they don't accept trust but this
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just means in the Valencia region at the
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moment people can breathe a little bit
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easier I think even I was worried I was
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saying to my husband if something
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happens to you and me you know our
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daughter we left the house this that and
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the other she can't afford to pay the
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inheritance tax on it no that was
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something yeah yeah it was always a
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worry at the back of everyone's mind so
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that is you know it is a huge bit of
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good news and I think people should be
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very pleased with it and you should keep
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an eye on what the government in
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Valencia is doing and I know expats we
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tend not to vote in elections but you
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can vote in Spain and if you want things
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like this to happen and a party is doing
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it for you will come the next elections
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please go out there and vote and keep
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them in power because otherwise if
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there's a power shift and it goes back
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to the Socialists they will scrap all
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these things and they will bring back
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taxes that maybe are not for your
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benefit so please just don't sit on your
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Laurel sink or things have changed if
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there is a next election and you're
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happy with what's going on go out there
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and vote yeah you need to get rid of the
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party that's making your life better
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make sure you're registered in time
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because it's quite a way ahead of the
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election you need to be having things in
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place here's the thing you're talking
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about the groups um that that will
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affect so if in group four there
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um so get married or pay the inheritance
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tax
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that's a tough one ask me an easier
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question I've had quite a few people get
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married you know they're they're getting
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on in life they've been together a long
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long time they're as good as married I
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suppose
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everyone got married
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um you know if you've been with your
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partner 20 30 years what's the
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difference a bit of paper is going to
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make apart from save you a hell of a lot
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in tax and if you want your partner to
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be secure if anything happens to you why
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not do it you know why not look after
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them why not think of them
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um so that's something people do need to
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consider as I said you know it's been a
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huge change it wasn't expected it was a
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very very bold move and I applaud them
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for it because they said they were going
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to do things like this and lots of
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parties they say they're going to do
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things and they don't this is one party
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that is actually following through so
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let's see how far they go listening and
9:41
exceeding expectations for over 31 years
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