Inheriting a property is not a gift, but involves facing obligations such as paying inheritance taxes and the municipal capital gains tax on inheritance. It is important to understand this tax to avoid surprises with the inheritance. In this article, we explain what it is, how it is calculated, what exemptions can be applied in Barcelona, and answer the most frequently asked questions.
What is the capital gains tax on inheriting a property?
The first thing you should know is that the municipal capital gains tax is technically called the Tax on the Increase in Value of Urban Land (IIVTNU). It is a municipal tax, meaning it is managed by each city council and taxes the increase in value that a property has from the time it is acquired until it is transferred.
This transfer can occur between living persons (inter vivos), as in the case of the sale of a property like an apartment, or as a result of the death of a person (mortis causa), that is, when a property is passed on to an heir.
Who pays the capital gains tax on an inheritance?
The capital gains tax, in the case of inheritance, is paid by the heir and must be settled within 6 months from the time of death, although an extension of 6 more months can be requested, provided it is applied for within the first 5 months of the submission period.
It is quite common to request extensions so that heirs can gather the necessary amounts to pay the capital gains tax and the inheritance tax.
How is the capital gains tax calculated?
There are two methods to calculate the capital gains tax: the first is based on the cadastral value, and in the second case, the real capital gains are considered.
In the first case, the years that have passed since the property was acquired until it is transferred are taken into account. Based on the number of years, a table of coefficients is consulted and applied to the cadastral value of the land shown in the property tax (IBI) receipt. These coefficients are published each year by the Tax Agency.
With the second calculation method, the real capital gains are considered, that is, the difference between the price at which the deceased acquired the property and its value at the moment the heir receives it.
Who chooses the method to calculate the capital gains tax?
The taxpayer chooses, and it is important to perform calculations to determine which method is more advantageous. The result will depend on factors such as the time elapsed from acquisition to the transfer date or the relationship with the deceased.
Which coefficients apply in 2025?
As mentioned, the coefficients are published each year, and those for 2025 were published at the end of 2024. The minimum coefficient is 0.10 and the maximum is 0.35, for a period equal to or greater than 20 years.
Can exemptions be applied to the municipal capital gains tax?
The answer is yes; the heir can apply exemptions, which depend on each city council, if they receive the property from direct family members. This can significantly reduce the amount to be paid, as in some cases the applicable exemption can reach 95%.
What if the property has not increased in value or has decreased?
It may happen that the property has the same value as when it was acquired or even a lower value. In these cases, you will not have to pay the capital gains tax, but it is advisable to submit a self-assessment and check the “not subject” box as well as attach evidence proving that there has been no increase in value.
How is the capital gains tax paid?
The procedure will depend on what each city council has established, which may regulate different procedures, but in general, the following documents must be submitted in the case of an inheritance of a property:
- · The deed accepting the inheritance of the property.
- · The certificate of last wills.
- · The acquisition title by the deceased person.
- · The last property tax (IBI) receipt.
- · The beneficiary’s ID.
Which exemptions apply in Barcelona?
Several exemptions and reductions apply in Barcelona. The exemptions are as follows:
- · Transfer by inheritance of a residence. In the case of a primary residence, the condition for the exemption is that it is not transferred within the following three years. The exemption is 95% and applies when the heir is the spouse or the ascendants or descendants by blood or adoption.
- · Transfer by inheritance of a commercial property. It must be a property where the deceased carried out a professional or business activity regularly. The exemption is 95% for the spouse, descendants, or ascendants by blood or adoption.
Properties used for rental or real estate sales are not included in this exemption. For the exemption to apply, the person acquiring the property by inheritance must maintain the property and continue the activity for five years following the death of the deceased.
Can the primary residence exemption be applied if the tax is paid late?
It may happen that the capital gains tax is not settled on time. In this case, the primary residence exemption can be applied as long as an inspection or verification procedure by the Tax Agency has not been initiated.
If I accept the inheritance and pay the capital gains tax and then buy the inherited part from the other co-heirs, do I have to pay the tax again?
It may also happen that the inheritance declaration is signed, a property is jointly owned by several heirs, and the capital gains tax is then paid, but one of the heirs decides to buy the other shares.
In these cases, the capital gains tax is not paid again for the dissolution of the co-ownership, but when the property is transferred again, the transfer date is considered the original inheritance acquisition date, not the co-ownership dissolution date.
I have already paid the capital gains tax and realized that the land value of the inherited property has not increased. Can I request a refund?
Yes, you can request that the self-assessment be modified as long as it is done within four years. For this, a request must be submitted with copies of the transfer and acquisition deeds attached. The Tax Agency will review the documentation and approve or reject the request. As we have seen, these are cases where calculations are necessary to determine what must be paid, in order to assess which method to use to calculate the municipal capital gains tax on inheritance and whether an extension is necessary to settle the tax.
If you have questions about how to calculate the capital gains tax, what exemptions you can apply, or how to correctly manage the inheritance of a property, our team at Proddigia can help. Contact us and we will guide you step by step so you can make informed decisions and avoid tax surprises.
