SPAIN Law and Practice Contributed by: Álvaro Checa, Miguel Checa, José María Vargas-Machuca Reyes and Andrea Fernández Grymierski, KINSHIP
KINSHIP Calle de Génova 27 planta 6 28004 Madrid Spain
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1. Contemporary Cultural Considerations in Succession Planning 1.1 Social and Cultural Attitudes Spain is a multi-legislative jurisdiction in which sev- eral civil law systems coexist, combining the Spanish Civil Code with a number of regional ( foral ) regimes (Catalonia, the Basque Country, Navarra, Galicia, Aragon and the Balearic Islands). This pluralism is a defining cultural factor in succession planning. All Spanish civil systems recognise forced heirship rules that significantly limit freedom of testation and reflect a strong cultural emphasis on family protection and intergenerational wealth preservation; however, their legal configuration and practical impact differ signifi- cantly, with some regional regimes adopting notably more flexible approaches. These divergences are also evident in matrimonial property regimes: while some regions provide for a statutory regime of community of property, other regions have opted to establish the separation of assets as the default regime (Catalonia and Balearic Islands). In terms of broader cultural attitudes towards wealth distribution beyond the family sphere, philanthropy and charitable giving have been gradually gaining prominence. While traditionally secondary to family succession, there is an increasing trend among high net worth individuals to include charitable legacies in estate planning, often structured through direct bequests to public interest foundations or chari- ties, reflecting a growing awareness of social impact
alongside family wealth preservation. Private or family foundations are not possible in Spain. 1.2 Wealth Profiles and Industry Influences A defining feature of wealth in Spain is the predomi- nance of family-owned businesses, which constitute a substantial portion of the country’s economic land- scape. Many of these entities were founded or signifi- cantly expanded during Spain’s economic liberalisa- tion following the transition to democracy and remain under the control of the older generation, which is now approaching or entering retirement. Consequently, succession planning has become a strategic prior- ity. This demographic transition has increased client awareness of the need for early and structured plan- ning to ensure business continuity and to prevent fam- ily disputes. From a tax perspective, Spanish law provides specific incentives designed to facilitate the preservation and intergenerational transfer of family businesses. At the state level, Spanish inheritance tax offers significant relief for the transfer of qualifying family owned and managed businesses, allowing for a reduction of the taxable base, subject to certain conditions. In addi- tion, various Spanish regions – known as Autonomous Communities ( Comunidades Autonomas )– have intro- duced further tax benefits such as 99% or100% tax relief for next-of-kin transfers. From a private law perspective, the family charter ( protocolo familiar ) has emerged as a key governance instrument, serving as a framework agreement among family members with an interest in the business and
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