The cost of not making a will: a villa in Marbella and a Jaguar could end up in the hands of the state

The Spanish state could be declared sole heir of the estate of Edna Grace Turner, a woman who died on 2 June 2017 in Marbella. Her last place of residence was in Guadalmina Alta. The villa in which she lived until her death, with a cadastral (rateable) value of just over 275,800 euros, is part of her estate that could end up in the Spanish government coffers, along with a Jaguar and a Ford Focus, and several debit, savings and investment accounts amounting to more than 100,000 euros.

The case is pending resolution but, as the heirs in the will have waived their rights to the estate, the Ministry of Finance has published in the official BOE state gazette a notification initiating proceedings to declare the state as heir, provided no other rightful beneficiary comes forward.

This lady had made a will. Even so, sometimes declaring our last wishes can complicate matters as the inheritors can disclaim the estate, as in this case.

Ramón Blesa, notary and member of the board of directors of the Andalusian college of notaries for Malaga said that, in recent years, such waivers have been declining. but they continue to happen - typically in two circumstances: when the heirs are not the children, but rather the nephews and nieces, because the tax burden - almost non-existent for the former - is greater for the latter. The second case is when the estate includes outstanding debts. To avoid any nasty surprises, the trick in the latter case is to accept the inheritance "under the benefit of inventory". In this way, the outstanding debts can only be paid from the estate's assets. If the heirs accept the inheritance outright, they will have to use their own assets to repay the debts incurred by their deceased relative.

There was such a case in Malaga published in the BOE regarding forced heirs (under Spanish law the person[s] who must be granted a percentage of the inheritance). The forced heirs - the parents and a sister, plus an aunt and uncle who appeared later - disclaimed the estate of a relative who had died in 2015 as it included a mortgage debt of 175,000 euros.

In any case, according to figures from the ministry of Finance, the assets of a deceased person passing to national coffers is very exceptional. In the last four years, only two estates in Malaga province, totalling 34,430 euros, have gone to the public purse due to waivers or lack of heirs.

So, where does this surprise windfall end up? According to the law, two thirds are allocated for social purposes and the other third constitutes income for the public treasury. The procedure is a lengthy affair though, taking up to fifteen years to complete.

So, if there are problems with inheritances that have been properly planned with a will, imagine the hassle in cases where there's poor planning, or even no will? According to our region's notaries, so far this year 11,390 people have already died with no will. In the last decade, the annual figure has fluctuated between 10,000 and 20,000. Intestacy carries the risk that the distribution of assets will be contrary to the wishes of the deceased person since most people are ignorant of the order of succession established by inheritance law.

Blesa does help to dispel two myths: if there is no will, it does not mean paying more inheritance tax; and if a will has not been made, the assets follow their normal course of succession in the family, they do not go straight to the state.

In general, the order of succession indicates that the first to inherit are the children and grandchildren, as well as the spouse. If there are none, then the parents. Next come siblings, nephews and nieces, uncles and aunts. Cousins come last.

What are the problems that can arise if a will is not made? In reality, it depends on the family situation of the deceased.

For example, in the event that a person with children dies without a will, his or her spouse would be unprotected, in the words of Beltrán, because they would only have the usufruct (the use and enjoyment for their lifetime) of one third of the inheritance, as strictly established by law, and perhaps that was not the intention of the deceased. In a will, the spouse could be left with, at most, the usufruct of the entire estate.

According to the rules, when a will is made, one third of the assets are distributed equally among all the children - known as the 'legítima' (lawful heirs). Another third, the 'mejora', can be awarded to any descendant to 'better' their life. The final third can be freely willed to anyone named by the benefactor.

At this point it should be clarified that adopted children have the same inheritance rights as biological children. Blesa also told SUR that a will can be used to recognise the paternity of a child not acknowledged during life, so they would be included in the share-out.

Another situation in which the spouse would also be unprotected is in the case of a childless marriage. According to Blesa, if either of the couple died intestate, the parents of the deceased partner would inherit practically everything. Looking at this in more detail: according to the specific ruling on this, half of the inheritance would go to the spouse as usufruct, of which, in turn, half of that half would go to the deceased's parents under bare ownership (owning, but not possessing an asset; use of that asset remains with the usufruct), in addition to their own 50% inherited as property. This way of distributing assets could very well be contrary to the dying wishes of the deceased person, especially if we take into account that for many people the only property they own is their habitual residence.

We must also keep in mind that, if you wish to bequeath your estate differently, if there are no surviving parents, grandparents or direct descendants, dying intestate means that the spouse inherits everything, before your siblings, aunts, uncles or cousins. When there is no surviving spouse the estate passes to siblings and then to nephews and nieces - specifically, to living siblings and, to the children of any deceased sibling, the corresponding share that would have gone to their parent.

Based on all these possible circumstances, it is pretty obvious it makes sense to write a will. There is, of course, a cost depending on its length, 40 to 50 euros. It can be revoked and changed. A warning from Blesa: making a will becomes more important for unmarried couples as they are not legally recognised as spouses and thus do not have any inheritance rights with respect to each other. You are no safer if you have registered as a common-law couple, as the only rights associated with this are to do with social security benefits.