Receiving an inheritance does not imply paying income tax, as those assets already pay Inheritance Tax. Lawyer David Jiménez dispels one of the most common doubts among taxpayers.
Receiving an inheritance not only involves an emotional transition but also a series of tax obligations that generate many questions. One of the most frequently asked is whether inherited assets must be declared in the Income Tax. The answer, according to inheritance specialist lawyer David Jiménez, is clear: no. “Assets acquired through inheritance are taxed under Inheritance Tax, so if you included them in your income tax return, you would be paying twice for the same thing,” he explains in one of his social media videos.
Article 6.4 of the Income Tax Law states that if Inheritance Tax has already been paid, there is no further taxation under income tax. This means that when inheriting a property, a vehicle, or an investment fund, these do not generate additional income that needs to be included in the declaration. “Imagine inheriting a flat worth 300,000 euros. You pay your Inheritance Tax as the heir and that's it. That 'income' does not add to your salary or your income for the year,” Jiménez exemplifies.
The Inheritance Tax Already Taxes the Transfer
The key is to understand that the Inheritance and Donations Tax taxes the change of ownership of the assets. Therefore, when a person receives an inheritance, they have already fulfilled the corresponding tax obligation. “If you inherit a flat worth 300,000 euros, you pay your Inheritance Tax as the heir and that's it. That 'income' does not add to your salary or your income for the year,” insists the lawyer.
However, once the asset becomes the property of the heir, the general rules of income tax come into play. “Once the inheritance has been accepted, that acquired asset must be taxed according to the income tax regulations,” clarifies Jiménez. This means that if the heir decides to rent out the flat, sell it, or simply leave it empty, those situations do generate tax obligations in the income tax.
What Happens If You Sell or Rent the Inherited Asset
The lawyer details the scenarios following the inheritance. “If you rent out a flat, you have to pay tax on it; if you sell it, you have a capital gain; and if you leave it empty, you have to pay tax as an imputed income from real estate,” he points out. The same applies to an inherited investment fund: if sold, the capital gain obtained is taxed under income tax according to the usual rules.
“The Inheritance Tax taxes the transfer of ownership of the assets, and income tax comes into play if that asset starts to generate income (if you rent the flat or if you sell it later at a profit),” concludes Jiménez. Therefore, receiving an inheritance does not automatically imply paying income tax, but it is important to understand what happens to the assets from that moment on.
To avoid mistakes, heirs should review the outstanding tax obligations of the deceased, ensure that all assets are correctly declared, and know the dates and values that the tax authorities use as reference. Good planning can save headaches and, above all, avoid penalties.
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