Inherit €200,000 for €27 in tax — and yet more and more Canarian heirs say: no thanks

The sum nobody quite believes

Picture this: your father leaves you a flat on Gran Canaria worth €200,000. You're his son, you live in Manchester. How much inheritance tax do you pay in Spain?

About €27.

That figure appears in no official worked example. The Agencia Tributaria Canaria offers no online calculator for inheritance tax and publishes no specimen calculation, only a help program to download. So we do the sum here ourselves, step by step from the named legal texts, so that you can check it. Assume you are his son, over 21, and that your own wealth before the death was below €402,678.11:

Step 1 — the kinship reduction. Article 20 of the Canary Decreto Legislativo 1/2009, as worded by article 46 of Ley 4/2012, deducts €23,125 for a child, replacing the state deduction of €15,956.87. That leaves €176,875 taxable.

Step 2 — the scale. There is no separate Canary scale, so the state scale in article 21.2 of Ley 29/1987 applies: €23,063.25 plus 21.25% on the €17,240.17 above €159,634.83. That gives a cuota íntegra of €26,726.79.

Step 3 — the multiplier. The multipliers are the state ones too (article 22.2 of Ley 29/1987). For Group II and pre-existing wealth up to €402,678.11 it is 1.0000, so the cuota tributaria stays €26,726.79.

Step 4 — the relief. Article 24 ter of Decreto Legislativo 1/2009, as worded by Decreto-ley 5/2023 of 4 September 2023, relieves 99.9% of the cuota tributaria — not of the inheritance. A thousandth remains payable: €26.73.

Two things move the result a long way. If the flat was your father's habitual residence, is located in the Canaries and you keep it for five years, article 22 ter deducts a further 99% of its value, capped at €200,000 — on a €200,000 flat the tax then falls to nothing. If your own wealth was already above €4,020,770.98, the multiplier rises to 1.2000 and the tax to €32.07. The honest sentence is therefore: between nothing and about €32, and about €27 in the ordinary case.

Since September 2023 the Canaries waive 99.9% of inheritance tax for direct heirs. That makes the bill small, but not arbitrarily small: what is left grows with the estate, because a thousandth of a large tax is still something. On a €5 million inheritance between father and son the same scale produces a cuota tributaria of €1,620,260.17 — of which about €1,620 is payable, not under a hundred. The islands are, with La Rioja, the most generous region in Spain. What many don't know: the relief isn't only for children and spouses. It covers siblings, aunts, uncles, nieces and nephews too. An aunt leaves you something — you pay almost nothing.

That's the lovely theory. Now the reality.

Why 2,133 people said no anyway

In 2025, 2,133 people in the Canaries stood before a notary and declared: "I don't want this inheritance." More than in 2024 (2,123), more than in 2023 (2,045). Fifteen years ago the figure was four times smaller. So why?

Lawyers knew the answer before the reform. For most heirs, it isn't about tax. It's about three other things.

First: debts. Accepting an inheritance means inheriting not just flats and accounts, but also mortgages, outstanding loans and unpaid bills. A Spanish bank that lent your father €80,000 still owing on his flat will come after you after he dies. If the flat is worth the same €80,000, the inheritance is a zero-sum game with risk attached. If the flat is worth less, you make a loss. Logical move: renuncia.

Second: side costs. Accepting a Canarian inheritance has a price tag. Notary, property registry, certificate of heirs, possibly valuers — easily €3,000 and up. Plus arrears on IBI council tax, community fees, possibly unpaid rubbish charges. What the tax saves you, the notary takes back.

Third: properties nobody wants. Many Canarian inheritances involve houses in remote villages, run-down flats in neighbourhoods with no demand, fractional plots with quarrels between siblings. Take it on and you take on annual property tax, annual maintenance, annual headaches — for a property you can't sell.

Inheritance tax? Plays no part. Never did. A study by Fundación FEDEA showed this years ago: people walk away from inheritances because of debts and family rifts — not because of the taxman.

What politics did anyway

In September 2023, the Canarian government under Fernando Clavijo (CC) and his deputy Manuel Domínguez (PP) pushed through the 99.9% relief. The argument: less tax = fewer refusals = more lifetime gifts = smoother handover between generations.

In August 2024, Domínguez proudly announced: the reform was working, refusals were down in the first quarter. Eighteen months later, the verdict is in. It looks like this:

More refusals. Fewer gifts. €52 million less in the kitty — money that won't now flow into schools, hospitals or roads. Between 2002 and 2022, similar reforms have already wiped out over €350 million in revenue in the Canaries. Spain-wide, more than €2 billion a year is missing thanks to tax breaks for heirs, FEDEA estimates.

The reform doesn't work because it solves the wrong problem. The real problem isn't taxes that are too high. It's too many debts, too many admin costs, and too many worthless properties.

What to do if you inherit in the Canaries

Rule one: don't rush. The six months from the date of death are the deadline for filing the tax return — article 67.1(a) of the regulation, RD 1629/1991 — not for making up your mind. Spanish law sets no deadline within which you must accept or refuse: under article 1016 of the Código Civil you may still accept for as long as the action to claim the inheritance has not prescribed, which for immovable property is thirty years (article 1963). You are only put on a clock if an interested party has a notary serve notice, which gives you thirty calendar days; stay silent after that and the inheritance counts as accepted purely and simply (article 1005). For the first nine days after the death nobody can force a declaration out of you at all (article 1004).

Extending the tax deadline costs money. Article 68 of RD 1629/1991 lets the six months be extended by a further six, so to twelve, if you apply within the first five months (paragraph 2); after the fifth month it is refused (paragraph 4), and if it goes unanswered for a month it counts as granted (paragraph 3). Paragraph 6 expressly ties the extension to an obligation to pay late-payment interest for the period from the end of the sixth month until you file. The rate is 4.0625%, which the Agencia Tributaria states still applies in 2026 until a 2026 budget law sets another.

Three options — know them:

Pure acceptance (aceptación pura y simple): you take everything — assets and debts. If the debts are bigger than the assets, you cover the difference out of your own pocket. Sounds risky — it is. Only do this if you know exactly what's in the estate.

Acceptance with inventory (a beneficio de inventario): the clever middle road. You inherit, but you only answer for debts up to the value of what you inherit. If debts outweigh assets, you lose nothing of your own. Slightly more expensive at the notary, because a formal inventory is drawn up — but for any inheritance where you don't know the numbers cold, the only sensible choice.

Renuncia (refusal): you inherit nothing. No flat, no debts. Done before a notary, irrevocable, with effect from the date of death. You can't refuse partially — it's all or nothing.

What to do before you decide, no matter what:

Check IBI status (council tax). Arrears on the flat come with you. Check the mortgage balance at the property registry (Registro de la Propiedad) — a basic search costs under €20. Get bank statements of the deceased. Banks are obliged to hand them over to heirs. Check community charges on the building — those become debts too.

And if you live in the UK: get advice from a Spanish lawyer who also understands UK Inheritance Tax (IHT). An inheritance can be practically tax-free in Spain — and still fully taxable in the UK, at 40% above the £325,000 nil-rate band. There is no UK–Spain treaty for inheritance tax, and there never has been one: Brexit changed nothing here. The Agencia Tributaria lists conventions covering Spanish inheritance and gift tax with three countries only — France, Greece and Sweden — while the UK–Spain conventions cover income, corporation, capital gains and wealth taxes. Relief therefore comes from each country's own rules, not from a treaty. With about €27 of Spanish tax there's next to nothing to credit anyway. Bottom line: full UK rate. Plan accordingly.

Frequently asked questions

I'm British and my father died on Gran Canaria. Do I pay tax in the UK as well?

Almost certainly. Since 6 April 2025 UK Inheritance Tax turns on long-term UK residence rather than domicile: someone UK-resident for ten of the previous twenty tax years is within the charge on their worldwide estate, at 40% above the £325,000 nil-rate band. And there has never been a UK–Spain inheritance tax treaty — that has nothing to do with Brexit. The Agencia Tributaria lists only France, Greece and Sweden for Spanish inheritance and gift tax; the UK–Spain conventions cover income, corporation, capital gains and wealth taxes. Any relief therefore comes from each country's own rules. Talk to a UK-Spain inheritance specialist before you sign anything.

If I refuse, can my child inherit instead?

Usually yes — but not by right of representation. Article 923 of the Código Civil says the opposite: where the relatives of the nearest degree disclaim, those of the next degree inherit in their own right and expressly cannot represent the person who disclaimed; article 929 rules out representing a living person in any case. In practice: if there are co-heirs of your own degree, your siblings for instance, your share first accrues to them (article 922). Your child moves up only if everyone in the nearer degree disclaims, and then inherits per head, not per stirpes. Your child can also accept or refuse, and refusal is irrevocable. Silence counts as acceptance only where an interested party has a notary set a thirty-day deadline (article 1005).

How long does the whole thing take?

Straightforward inheritance: two to four months. With disputes, a mortgage or unclear succession: six to twelve months, sometimes longer.

What does a Spanish lawyer cost for inheritance work?

Initial consultation €200–500. Full inheritance handling with all the steps €1,500–4,000, depending on complexity. For large estates a percentage fee is often agreed.

Can I sort everything out from the UK?

Yes, through a notarial power of attorney (poder notarial) to a Spanish lawyer or gestor. Sign it at a UK notary with an apostille. Saves flights and admin.

What if I miss the six-month deadline?

A surcharge under article 27.2 of Law 58/2003 (Ley General Tributaria): 1% plus a further 1% for each full month of delay, if you file late of your own accord. After twelve months it is 15% plus late-payment interest. The old 5–20% scale has not applied since July 2021. Under paragraph 5 the surcharge is cut by 25% if the tax and the surcharge are paid on time. The deadline is for filing the tax return, not for accepting or refusing. If you plan to renuncia, still act formally on time.