There have been some changes, the outline below covers the current rules assuming Mr. & Mrs. Lamborn are referring to Andalucia, if not let me know where and I will provide up to date information. 

Regards 

David Bowern

7.9.1    Andalucia

Note: Possible 100% tax relief for Group I/II residents on inheritances up to €175,000  – see item 3

 1          Personal reductions

 Same as State rules.

 

In Andalucia unmarried couples registered as a ‘pareja de hecho´ (a de facto couple) are within Group II and those in a family unit by way of "family welcome" ("acogimiento familiar") in accordance with Andalucia´s rules on protecting minor children are included in Groups I or II as applicable, depending on their age.

 

2          Main home relief

 99.99% under the same conditions as for the State rules (i.e. must be kept for 10 years, maximum reduction of €122,606) and with the additional condition that it must be the main home of both the deceased and the recipient at the time of death.

 

3          Other reliefs – Possible 100% Exemption

 

From 6^th June 2008, no tax is payable provided:

 

a)      The recipient is a close relative falling in Groups I and II (i.e. spouse, direct line recipients), and

b)      The taxable value of the inheritance received is no more than €175,000, and

c)      The wealth of the recipient is no more than €402,678

 

For beneficiaries with a disability of more than 33%, the limit on the taxable inheritance (condition (b) above) is increased to €250,000.

 

4.         Relief for Small Businesses

 

From 2007, the relief was increased to 99% on inheritances of small businesses situated in Andalucía provided the business or shares are retained for 5 years (not 10) following death.  From 2008, the condition for it to be a small business has been removed, so the relief applies to all businesses regardless of turnover.

 

A small business in this context was one which had a turnover of less than €8m in the previous year.

 

5.         Lifetime gifts to children to acquire first home

 

There is a 99% relief on the final gift tax payable on monetary gifts to children (<35 years old) of up to €120,000 (€180,000 if descendant has a disability of 33% or more) disabled to purchase their first main home, which must be situated in Andalucía.

 

The entire cash gift must be used to purchase the main home.  The pre-existing wealth of the donee must be less than €402,678.  The property must be purchased within one month of the gift and must be noted in the purchase documents.