What happens if a UK Will excludes Spanish property?

This article by Dennis Phillips, Partner in our Private Client team, explores the key issues involved in Anglo-Spanish succession planning.

Dennis will examine the legal, practical and tax considerations that arise when assets, beneficiaries or executors are based across both countries over a series of nine articles.

Drawing on decades of experience advising UK and international clients, he will provide clear, practical guidance to help individuals make informed decisions, avoid common pitfalls and ensure their wishes are carried out as intended.

The hidden risks of leaving Spanish assets outside your UK Will

In UK-Spain succession planning, it is not uncommon for an English Will to exclude Spanish assets altogether.

The intention is usually clear. The English position is dealt with there and then, with you being advised to obtain separate Spanish input so that the Spanish position can be addressed properly and the two arrangements work together as intended.

The difficulty is that life has a habit of getting in the way.

The need for further action has been identified and explained. You fully intend to deal with it. The problem is that it rarely feels like something that needs to be done today. Other priorities take over, months become years and, in some cases, the intended Spanish planning never happens at all.

While you are alive, that may not seem particularly important. There is usually still an opportunity to revisit the issue. After your death, however, your estate must be administered using the arrangements that are in place, rather than the ones that were intended.

Sometimes the outcome is not materially different from what you intended. Sometimes it can fundamentally alter who inherits what.

Case study

What can happen when Spanish property is left outside a UK Will: The Menorca Mistake

Dave, a retired British widower, had relocated full‑time to Menorca. His longstanding English adviser, Carol, had acted for him across a range of private client matters over many years – including Wills, probate, conveyancing, employment and divorce.

Carol’s approach to overseas assets was consistent and clearly articulated: her standard practice was to exclude foreign assets from the English Will and to advise clients to obtain separate local advice in the relevant jurisdiction.

In Dave’s case, that next step never happened. Several years passed without a Spanish Will being made. As far as Dave was concerned, the position was straightforward. Rachel, his biological daughter, was to inherit his English estate. Jill, his stepdaughter, was to receive the Menorcan property.

What happened to the Spanish property?

Because the English Will expressly excluded all foreign assets, it had no effect on the Menorcan property. There was no separate Will dealing with the Spanish estate. As a result, the property passed in accordance with the applicable intestacy rules rather than Dave’s wishes.

Rachel inherited the Menorcan property. Jill, the intended beneficiary, received no interest in it.

Why the succession planning gap mattered

The problem was not that Carol’s advice was wrong. Excluding foreign assets from an English Will, pending separate local advice, was a perfectly reasonable approach. However, it was an approach that depended on further action being taken. The difficulty was that the next step never happened.

Dave believed the position was straightforward. Rachel would inherit his English estate. Jill would inherit the Menorcan property. However, those intentions were never reflected in any document capable of dealing with the Spanish estate.

By the time the omission came to light, the intended outcome could no longer be achieved through straightforward succession planning. Although alternative solutions may still have been available, they would have depended on beneficiary cooperation and were likely to bring additional tax exposure, cost and complexity.

What this case shows about UK-Spain succession planning

Cross-border succession problems do not always arise because of complicated legal rules or technical drafting errors.

Sometimes the problem is not the advice that was given. It is the advice that was never acted upon.

In many families, that may make little practical difference. In others, particularly where blended families are involved, the consequences can be far more significant.

Relatively small gaps in planning can produce outcomes that bear little resemblance to what was intended. The longer those gaps remain unaddressed, the greater the risk that decisions will ultimately be made by the applicable succession rules rather than by you.

How Morr & Co can help with Spanish estate planning

If you own property or other assets in Spain, coordinated planning can help ensure your wishes are properly recorded and the arrangements in each jurisdiction work together.

Find out more about our Will writing for Spanish estates and our wider Anglo-Spanish property and inheritance service or contact our Private Client team by emailing info@morrlaw.com or calling us on 0333 038 9100.

Disclaimer
Although correct at the time of publication, the contents of this newsletter/blog are intended for general information purposes only and shall not be deemed to be, or constitute, legal advice. We cannot accept responsibility for any loss as a result of acts or omissions taken in respect of this article. Please contact us for the latest legal position.