Do I have to pay inheritance tax in Tenerife?

Most close relatives receive a 99.9% inheritance tax reduction in Tenerife. This means spouses, children, parents, siblings and grandchildren usually pay almost no tax.

Do I need to travel to Tenerife to complete an inheritance?

No. Most heirs sign a Power of Attorney and the entire process can be completed without travelling to Tenerife.

How long does Tenerife inheritance take?

Most Tenerife inheritance cases take between 1 and 3 months if the death occurred in Spain, or 3 to 6 months if it occurred abroad.

Can I sell an inherited property in Tenerife?

Yes, but only after the inheritance deed has been signed and the property is registered in the heirs' names. All heirs must agree to the sale.

What documents do I need for a Tenerife inheritance?

You need a death certificate, Certificate of Last Wills, the will (if any), passports, NIE numbers, property deeds, and bank information where applicable.

Inheritance Tax in Tenerife: Who Pays and How It Works

One of the biggest surprises for many families inheriting property in Tenerife is the tax situation.

Spain used to have a reputation for high inheritance tax. But the Canary Islands now have one of the most generous systems in the country.

In many cases, the tax bill ends up being almost nothing.

Here’s how it works.

The 99.9% Inheritance Tax Reduction

Since September 2023, the Canary Islands apply a 99.9% reduction on inheritance tax for most close relatives.

This applies to heirs in Groups I, II and III, which includes:

Children and grandchildren
Spouses and registered partners
Parents and grandparents
Siblings, nieces and nephews

That covers the vast majority of normal family inheritances.

Only more distant relatives or unrelated beneficiaries tend to face larger tax bills.

How the Tax Is Calculated

Spain still calculates inheritance tax using the national tax tables.

This produces what’s known as the theoretical tax amount.

After that, the Canary Islands apply the 99.9% reduction, which reduces the final payment dramatically.

For example, an inheritance that would normally generate €12,000 in tax could end up costing roughly €12 after the reduction.

Which explains why many families are pleasantly surprised.

What About Non-Residents?

Inheritance tax in Spain is based on where the asset is located, not where the heir lives.

So if you inherit property in Tenerife, the tax declaration must still be filed in Spain even if you live abroad.

In most cases:

EU and EEA heirs receive the same tax benefits as residents
UK and other non-EU heirs can often still qualify for the same reductions, although the paperwork can sometimes be a little more involved

Other Costs to Be Aware Of

Even though inheritance tax itself is usually minimal, there are still a few other costs involved.

These may include:

Plusvalía Municipal, the town hall tax on land value increases
Notary and Land Registry fees for transferring ownership
Capital Gains Tax, which only applies later if the property is sold

When Must the Tax Be Filed?

The inheritance tax declaration, Modelo 650, must normally be filed within six months of the date of death.

Extensions are possible, but they need to be requested before that deadline passes.

The Reality for Most Families

In practice, most heirs in Tenerife end up paying very little inheritance tax thanks to the regional reduction.

The main task is simply making sure the paperwork is filed correctly and within the time limits.

Once that’s done, the inheritance itself usually moves along fairly smoothly.