|Expats in Spain 'Owed £400 Million in Overpaid Inheritance Tax'|
British expats wrongly charged inheritance tax on their Spanish properties are gearing up for a legal battle to reclaim the charges
It is estimated that around 60,000 British families have been hit with Inheritance tax (IHT) bills for properties or assets they inherited in Spain. Charges are believed to be in the region of £400 million (€490 million).
The Spanish government levied IHT of up to 35 per cent on non-residents, while Spanish residents paid close to zero per cent IHT.
The European Commission believes this is an unfair tax treatment with regard to EU citizens. It brought a legal case to the European Court of Justice (ECJ) in March arguing that Spain was infringing EU treaty freedoms. A verdict is expected from the ECJ which could open the floodgate to thousands of Brits reclaiming their tax, and force Spain to amend its IHT tax laws.
While 60,000 Brits are believed to have wrongly paid IHT, only 40,000 are still able to make a claim due to the Spanish legal time limits.
The opinions expressed do not constitute investment advice and specialist advice should be sought about your specific circumstances.
Published on our website on May 9, 2012