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By Barry Davys
This article is published on: 5th May 2026
A simple guide to key terms used in cross-border estate planning
Understanding inheritance terminology can be challenging, particularly when dealing with assets in both the UK and Spain. Differences in legal systems, tax rules, and administrative processes can cause confusion for individuals and families managing cross-border estates.
This guide is designed for UK nationals living in Spain, Spanish residents with UK assets, and anyone involved in administering an estate that falls under both jurisdictions. It explains commonly used inheritance and probate terms in clear language to help you better understand the process and make informed decisions.
A written document prepared before a person’s death that sets out their instructions regarding who should manage the administrative aspects of their estate, who will be responsible for looking after their money and possessions while the process is being completed, and who they wish their assets to be distributed to.
The “estate” is the collective term for all financial interests of the deceased. This includes bank accounts, insurance policies, pensions, property, shares (including private and family-owned company shares), bonds, loans made to third parties that now need to be repaid, and other assets.
In Spain, rules apply regarding how two thirds of an estate must be distributed. Children take priority over spouses, and only one third of the estate can be freely distributed.
However, for expatriates living in Spain, EU Regulation 650/2012 (“Brussels IV”) allows them to elect for the inheritance laws of their nationality to apply to their Will. For a UK national, for example, this makes it possible to distribute the entire estate in accordance with their wishes.
Please note that this EU regulation only applies if the instruction is expressly included in the Will.
Probate is the term used to describe the legal process of administering and distributing an estate.
In Spain, the document confirming distribution in accordance with the law and the Will is called the Escritura de Aceptación y Adjudicación de Herencia (Deed of Acceptance and Adjudication of Inheritance), which must be signed before a Spanish notary.
In the UK, the equivalent document is known as the Grant of Probate, which is issued by the Probate Office.
A trustee and executor can be the same person, although it is often more than one individual in order to share the administrative responsibility.
The trustee is responsible for safeguarding the assets of the estate until they are formally transferred to the beneficiary. The executor is responsible for ensuring the legal formalities are completed so that the transfer of assets to the beneficiary is valid.
A beneficiary is a person named in the Will who will receive all or part of the estate.
A bequest is the term used to describe what is transferred to a beneficiary. This may consist of a single asset, such as a property, or multiple assets, such as property, bank account balances, and shares. A group of assets transferred together may also be referred to as a bequest.
Modelo 650 is the Spanish tax form used to declare and pay inheritance tax and to support the preparation of the Escritura de Aceptación y Adjudicación de Herencia.
The UK form used to apply for a Grant of Probate is Form PA1P (if there is a Will) or PA1A (if there is no Will).
If inheritance tax is due, the executor must first complete Form IHT400.
In the UK, the estate of the deceased is assessed for inheritance tax. The assessment is based on the total value of the estate.
In Spain, each beneficiary who is a Spanish tax resident is assessed individually for inheritance tax based on the value of the assets they receive.
As the UK and Spain tax different entities (the estate in the UK and the beneficiary in Spain), the same entity is not taxed twice. As a result, inheritance tax is generally outside the scope of the Double Taxation Agreement.
However, practical solutions may be available depending on individual circumstances, and appropriate professional advice should be obtained.
Inheritance tax is generally due within six months of the date of death. It is important to note that tax is not due from the date the beneficiary physically receives their bequest, which is a common misconception.
This six-month rule applies in both Spain and the UK:
At the start of every client relationship, we carry out a detailed discovery process to fully understand your personal and financial circumstances.
In this case, a married couple, both UK nationals living in Spain, held life insurance policies valued at £1,000,000 each. During our review, we identified that the appropriate Inheritance Tax mitigation documentation had not been put in place. Without this structure, the value of the life insurance policies would form part of their estate and could be subject to UK Inheritance Tax for their UK tax-resident beneficiaries.
Given that their estate exceeded the available allowances, this created a potential Inheritance Tax liability on the life assurance proceeds.
We implemented the appropriate documentation to ensure the policies were structured correctly. As a result, up to £400,000 per policy (£1,000,000 × 40%) in potential Inheritance Tax is avoided for their beneficiaries.
This article is provided for information purposes only and does not constitute legal advice. We recommend seeking professional legal advice to assist with the probate and distribution processes of an estate.
A specialist Inheritance Tax and Wills lawyer works with us to provide this service.
For an introduction to the lawyer, please email:
barry.davys@spectrum-ifa.com
