The growing mobility of citizens within the European Union makes international successions a topic of fundamental importance. In particular, for those with ties to Italy and Spain, knowing the rules governing the transfer of assets and rights mortis causa is essential to ensure correct asset management and prevent disputes.

The matter has been largely harmonized by Regulation (EU) No 650/2012 (known as the “Succession Regulation”), applicable since August 17, 2015, which establishes uniform rules on jurisdictional competence, applicable law, and the recognition of decisions in Member States (with the exception of Denmark, Ireland, and the United Kingdom).

1. The Criterion of Applicable Law: EU Regulation 650/2012

Regulation 650/2012 introduces the principle of a single law applicable to the entire succession, overcoming the fragmentation (or “scission”) that previously could lead to the application of different laws depending on the type of asset (for example, the law of the location for real estate and the national law for movable property).

General Criterion: Habitual Residence

The fundamental rule establishes that the law applicable to the succession is that of the State where the deceased had their habitual residence at the time of death (Art. 21).

• Attention: Habitual residence is not necessarily the registered or fiscal residence. It requires a complete assessment of the deceased’s life circumstances, considering the duration, the regularity of the stay, and the center of their interests.

Possibility of Professio Iuris (Choice of Law)

The Regulation allows an individual to choose, through an express declaration made in testamentary form (Art. 22), that the law applicable to their own succession shall be that of the State whose citizenship they possess at the time of the choice or at the time of death.

• This possibility is crucial, for example, for an Italian citizen residing in Spain who wishes their succession to be governed by Italian law, thereby guaranteeing the application of the Italian reserved share (legittima) rules, which strictly protect certain heirs (spouse, children, ascendants).

2. Differences between Italian and Spanish Succession Law

Despite the harmonization on the applicable law, substantial differences persist between the succession laws of the two Countries, making the choice of applicable law particularly significant. Below are the main differences:

Reserved Share (Quota di Legittima / Legítima):

• Italian Law: Strict reserved share (legittima) system: reserves a portion of the estate (which varies based on the number and quality of heirs) to the spouse and close relatives (statutory heirs or “legittimari”), strongly limiting testamentary freedom.
• Spanish Law: The concept of reserved share (legítima) is present but can differ in terms of quotas and allocation compared to the Italian system, also due to the peculiarities of the different Autonomous Communities (e.g., Catalonia, Basque Country). It often translates into a right of usufruct for the spouse.

Surviving Spouse:

• Italian Law: A full heir (competing with children or ascendants) and holder of the right of habitation on the family home.
• Spanish Law: In the absence of a will, the spouse inherits after descendants and ascendants, but holds a right of usufruct over a portion of the inheritance (usufructo viudal), the extent of which varies according to the heirs with whom they compete.

Acceptance of the Inheritance:

• Italian Law: Can be pure and simple (leading to the merger of assets and liability for debts with one’s own assets) or with the benefit of inventory (limiting liability for hereditary debts to the value of the assets received).
• Spanish Law: Similar (pure and simple acceptance or with benefit of inventory), but with the obligation to accept formally via a notary deed. The deadline for filing the declaration and paying the taxes is 6 months from the date of death (extendable).

3. Tax Aspects of Succession (Taxes)

EU Regulation 650/2012 does not apply to fiscal matters. Inheritance taxes remain regulated by national laws.

Italy – Spain: Double Taxation

Currently, there is no specific bilateral convention between Italy and Spain to avoid double taxation on successions.

This means that, in theory, heirs could be subject to tax in both Countries:

1. Italian Tax: Due if the deceased was resident in Italy or, if resident abroad, limited to the assets present in Italy.
2. Spanish Tax: Due if the deceased was resident in Spain (personal obligation on all assets) or, if non-resident, on assets located in Spain (real obligation).

To mitigate the risk, tax credit mechanisms provided by the internal law of each Country are generally applied, which allow for the deduction of the tax already paid abroad.

Spanish Peculiarity: Decentralized Succession Tax

In Spain, the Inheritance and Donation Tax (Impuesto sobre Sucesiones y Donaciones – ISyD) is managed by the Autonomous Communities (CC.AA.), which have broad regulatory powers over tax rates and reductions.

This can lead to significant differences in the tax burden depending on the Autonomous Community of the de cuius’s residence or the location of the assets, making a specific case assessment indispensable.

4. The European Certificate of Succession (ECS)

Regulation 650/2012 has established the European Certificate of Succession (ECS).

• Function: It is a document recognized in all EU Member States that allows heirs, legatees, executors, and administrators of the estate to demonstrate their status and exercise their rights in another Member State.
• Advantage: It simplifies bureaucratic procedures for the recognition of hereditary rights abroad, replacing the need to obtain multiple national documents.

Conclusions

Managing an international succession between Italy and Spain requires careful planning and a deep knowledge of both EU Regulation 650/2012 to determine the applicable law (potentially by exercising the professio iuris in favour of the law of citizenship), and the national fiscal rules, Italian and Spanish, to optimize the tax burden and avoid double taxation.

Therefore, to avoid any kind of problem, it is always advisable to consult professionals specialised in international succession and tax law. The professionals at Fiat Lux Legal are available to clarify any doubts and guide you through this process; therefore, do not hesitate to write to us at: info@fiatlux.legal.