How is an inheritance processed in the Community of Madrid?

Processing an inheritance in the Autonomous Community of Madrid and, in general, in the rest of Spain, is not a process that can be considered simple. In fact, it is quite laborious, which is why the know-how of a professional is practically essential. Moreover, if we add to this the fact that, generally, this type of procedure is associated with the loss of a loved one, it can become quite unpleasant if it is experienced at first hand.
For this reason, we have set out to explain, as simply as possible, the steps that must be taken to process an inheritance in Madrid. Let's take it step by step.

1. The death certificate

The death certificate is the essential document to start the process. In fact, without it, it is impossible to start the process. It is usually provided to the family by the funeral parlour itself and is issued by any Civil Registry office in the Community of Madrid.
Currently, the Civil Registry offers the possibility for anyone who wishes to request the issuing of the death certificate of a person via the Internet, something that speeds up the process and avoids uncomfortable waits in the long queues that usually occur in their offices. Once obtained, it is necessary to wait 15 working days to request the certificate of last will and testament.

2. The certificate of last will and testament

The second step in the processing of an inheritance in the Community of Madrid is to obtain the certificate of last will and testament, for which it is necessary to pay the 790 fee, which costs 3.70 euros. In addition, in order to complete it, it is necessary to provide the applicant's own details and those related to the name, surname, place and date of death and place and date of birth of the deceased.
Once the 790 fee has been paid, it is necessary to go to the Ministry of Justice, specifically to the Oficina de Atención al Ciudadano located at number 8, Calle de la Bolsa. There they provide what is known in Madrid as the Certificado de Actos de Última Voluntad (Certificate of Last Will and Testament).

3. The certificate of insurance contracts for death cover.

This certificate must also be obtained from the Oficina de Atención al Ciudadano in Calle de la Bolsa, as mentioned above. In addition, it is also necessary to pay, once again, the 3.70 euros corresponding to the 790 fee. In short, this document serves to know whether or not the person who has died granted a notarial will, which will be essential in the next step.

In addition, this certificate shows whether the deceased had taken out any insurance during his or her lifetime that provided for any kind of compensation for death. In this regard, it is essential to note that after five years from the date of death, the beneficiary loses the right to claim any compensation from the insurance, so it is important to be alert.

4. Is there a will?

At this point, the way forward is bifurcated depending on whether there is a will or not. We will explain both cases.

4.1 Handling an inheritance without a will or intestate succession in the Community of Madrid

In the event that the deceased has not left a will during his lifetime, a declaration of heirs must be made before a notary if the heirs are direct relatives of the deceased, i.e. parents or direct ascendants, the widowed spouse, children or grandchildren. On the other hand, if these are collateral relatives (siblings, nephews, nieces, cousins, etc.), the declaration of heirs must be made in court.

In any case, the declaration of heirs must include the original ID card of the deceased, the death certificate, the family record book and the certificate of last will and testament. In addition, two witnesses who knew the deceased and who have no interest in the inheritance must appear. For example, the spouse of one of the heirs would not be admitted as a valid witness.

With all these documents, the deed of declaration of heirs is prepared, which must be signed by at least one of the heirs and by the two witnesses mentioned above.

The period of time to wait once the declaration of heirs has been signed is 20 working days. This period, as well as the rest of the guidelines we are detailing, is set out in articles 55 and 56 of the Organic Law on Notaries of 28 May 1862. This long period is mainly due to the fact that the possible appearance of other legitimate heirs who have not been taken into account in the declaration made must be taken into account.

4.2 Processing an inheritance with a will in the Community of Madrid

If there is a Will, it is time to compile the documentation focused on proving the assets owned by the deceased and their value. In fact, this step is particularly important as the valuation must be provided to the notary's office through which the process is being carried out. In this regard, it should be noted that the Community of Madrid offers, through its official website, various asset valuation services. It is also necessary to ask the bank where the deceased had his or her personal accounts for the exact balance existing on the date of death.

5. Deed of testament and adjudication of the inheritance

Once it has been established whether or not a will exists and the appropriate steps have been taken in each case, the paths that previously diverged now meet again. Specifically, they do so in order to apply to the notary's office for the deed of declaration and adjudication of the inheritance, for which a document identifying the assets of which the inheritance is composed (account numbers, details of vehicles, cadastral references of premises and homes, etc.) and another that determines the value of these must be provided.

In this document, the value of all the assets is added up separately and the resulting amount is detailed, which is called the 'caudal relicto'. Each heir is then assigned the percentage that corresponds to him or her. In this regard, it should be noted that, in the event that this point is reached without a will, the allocation of the assets is made in equal shares. As soon as all the heirs sign the document, they automatically become the owners of the assets that correspond to them.

6. Payment of taxes related to the processing of an inheritance in the Community of Madrid

There are two taxes that heirs must pay in order to collect an inheritance in the Region of Madrid, namely:

6.1 Inheritance tax

The Community of Madrid is one of the Autonomous Communities with the highest inheritance tax rebates. In fact, they reach 99% of the total amount, so that the beneficiaries of an inheritance only have to pay 1 out of every 100 euros that correspond to them. This is not the case in all regions of Spain, which is to be welcomed.

Inheritance tax has to be paid within the first 6 months after the death. However, as there are many problems that can arise during the process, the law states that it is possible to enjoy an extension as long as it is requested within the fifth month at the Directorate General of Taxes or at an office belonging to the Registry of the Community of Madrid.

Does the obligation to pay inheritance tax lapse? The answer is yes, although the period is very long. In fact, it consists of the 6 months corresponding to the voluntary payment period plus another 4 years. In the event that the competent public administration detects that the relevant amount has not been paid, it has the power to impose a penalty.

6.2 Capital gains tax

The capital gains tax, also known as IIVTNU, is only applicable when you have inherited a certain type of property, such as a building. This tax has to be paid at the town hall of the locality to which the property belongs. Therefore, the amount varies in each municipality of the Community of Madrid. In any case, there are also interesting discounts for this tax depending on its value, whether it was the deceased's habitual place of residence, etc.

6.3 Other taxes

In principle, the taxes to be paid by the heirs can end with corporation tax and capital gains tax where necessary. However, it may also be necessary to pay other taxes arising from certain procedures such as, for example, the change of ownership of a vehicle at the Dirección General de Tráfico or the registration of a property at the Registro de la Propiedad (Land Registry). As these are not taxes directly linked to the inheritance, we will not go into them in depth.

As you have seen, the inheritance process in the Community of Madrid can be long and relatively complex. For this reason, if you want to speed up the procedures, it is best to put yourself in the hands of a professional in the field, a lawyer specialising in inheritance. In any case, we hope that we have been of help and that, from now on, everything related to this issue will be much clearer.