How to manage an inheritance

Do you want to know how to manage an inheritance effectively? After the death of a person, their respective heirs must face a series of procedures, the purpose of which is to value and distribute the inheritance. The way of acting, on the other hand, is also different depending on whether or not there is a will. We talk about it in the following lines.

How the inheritance is distributed

With the entry into force of the Voluntary Jurisdiction Law of July 2, 2015, the notary will be allowed to resolve certain situations for which it was previously necessary to resort to judicial means. This reform facilitates, among other issues, the unblocking of inheritances in which, due to lack of agreement or collaboration between the heirs themselves, they themselves find themselves at a point where they cannot advance.

By the term inheritance partition we understand the distribution of the deceased’s assets among the different heirs based on the share that each of them is entitled to. This partition must be made once it has been proven with the will or the declaration of heirs. When managing an inheritance, you should know that partitions are of different types:

-On the one hand, we would highlight the voluntary partitions , carried out by the heirs themselves by mutual agreement. They could be formalized through a private document, but it is most convenient to do so through a public deed before a Notary, especially when there are assets that can be registered in public registries, as is the case with real estate.

-The division of the inheritance through judicial means occurs when said agreement does not take place. In that case, the heirs must go to the Judge of First Instance, assisted at all times by a lawyer specialized in inheritances.

For the drafting and content of this type of inheritance distribution, it will be the lawyer who must present certain facts such as, for example, the death of the deceased, identification of all heirs and their respective addresses, the assets pending division and distribution together with the operations to be carried out, as well as the legal bases and the corresponding appeal.

-Finally, the so-called counter-partition partition could be highlighted This figure is the one that has been named as such by the testator in the will to carry out the distribution of his own inheritance. This distribution will require the approval of a judge.

Depending on the regional rights of each Autonomous Community, the civil code establishes the division of the inheritance between well-differentiated parts: the legitimate, the improvement and the freely available third.

The legitimate

Defined in article 806 of the Civil Code, the legitimate represents the part of assets that the testator cannot dispose of because the Law has reserved it for the so-called forced heirs. The latter are the children and descendants and, in the absence of these, the parents and ascendants with respect to their children. In the absence of all of them, there would be the widower or widower, who has the right to partial usufruct of the inheritance. This part of the inheritance is untouchable , in the sense that the testator may not impose any lien or substitution of any kind on it.

The only way to deprive an heir of the legitimate inheritance is to disinherit him. The forced heir that we have specified before cannot renounce the legitimate interest during the life of the deceased. If this resignation occurs, it would be annulled. However, this resignation after the death of the deceased once the succession is opened is valid.

In these cases, the children have the right, in case of legitimation, to two-thirds of the hereditary assets of the father and mother. In the event that one of the children had died earlier, the latter’s descendants have the same right as that corresponding to the former.

The improvement

For its part, improvement is that measure that can be used to especially benefit some children or descendants. If it is not expressly available, the amount of the legitimate amount will be increased.

The third of free disposal

In these cases, it will be the testator who decides to whom to leave the assets as an inheritance, whether family or not, and may even be a legal entity. On this part he can decide with absolute freedom.

To expand more on these topics, we recommend reading our article ” Legitimate, improvement and free disposal ”

How to process the inheritance

The heirs will have a short period of time to manage an inheritance , that is, the processing of the liquidation and allocation of assets, starting with the death certificate. 

-This document is usually provided by the funeral home itself. If this is not the case, you must request it at the Civil Registry, many of which give the opportunity to request it online.

-After 15 business days after the person’s death, the certificate of Last Wills must be requested from the General Registry of Last Wills, which is where all wills are recorded before a Spanish Notary.

-To obtain the certificate of last wills, you must provide the Death Certificate, Form 790 (code 006) and bank receipt of payment of the fee, presenting the form at the bank. All of these procedures can also be carried out electronically with the electronic signature.

Once both certificates are available, the situation will vary depending on whether there is a will or not. Let’s look at the two cases.

Process the inheritance with a will

If there is a will, the following procedure will be followed:

-You must request an authorized copy of the will at the Notary Office where the original document is filed.

-The request must be made personally by the interested party, although it may also be made by any other person with special power on behalf of the interested party or the Notary himself.

-In this case of inheritances, the information related to the valuation of the assets will be collected directly.

Manage an inheritance without a will

In the event that an inheritance must be managed without a will, the following must be considered:

-A declaration of intestate heirs must be processed (judicial procedure related to the allocation of assets when there is no will) to determine who are the closest relatives of the deceased with the right to inherit .

-This declaration is processed from the entry into force of the Voluntary Jurisdiction Law in July 2015 and always at the Notary’s Office, regardless of whether the children or descendants of the deceased, their parents or widowed spouse are collateral relatives of the deceased.

-This Law has attributed to the Notary himself the competence to declare the heirs collateral relatives, something that previously corresponded to the Judge.

How to pay less taxes on an inheritance?

When paying inheritance taxes, it must be taken into account that in certain Autonomous Communities, first-degree relatives do not have to pay the corresponding tax when managing an inheritance. If it is necessary to do so, the period is 6 months after receiving the inheritance. How to pay less taxes then? You can follow any of these points:

– Register in another Autonomous Community , where the tax burden is lower. To do this, the necessary requirements are, for example, having your own home or renting it, residing in the place where you want to change your address and having established living habits in that community. It is necessary to be registered before receiving the inheritance to achieve the corresponding savings.

-Through a family business , transfers enjoy a minimum exemption of 95%. In these cases, the company must be maintained for at least 10 years after the transfer.

-You can also take advantage of the exemption for your habitual residence , given that this type of property has a reduction of between 95% and 99% of the tax rate.

-Generally, donations during life have greater tax benefits than inheritance and will save you from a future estate problem.

If you want to know more about this topic, we recommend reading our article ” Difference between legacy and inheritance ”

And you? Have you followed any of these steps to manage an inheritance ? You can cheer up and share your experience with us by leaving a comment.

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