I inherited a flat in Valencia: what taxes do I pay and when should I sell?

Inheriting property in the Valencian Community today is far simpler from a tax perspective than it was five years ago. The 99% Inheritance Tax allowance approved in 2023 has eliminated the main cost that for decades led many families to refuse inheritances or undersell properties.

But other taxes still apply, and mistakes are still being made. Let’s go through them.

The three taxes when inheriting and selling

1. Inheritance Tax (paid by the heir on receiving)

In the Valencian Community, direct heirs (spouse, descendants, ascendants) get a 99% allowance on the tax due since May 2023. In practice, most families pay almost nothing.

Note: you must still file the return (Form 650) within 6 months of the death. A 6-month extension can be requested in the first 5 months. Failing to file incurs surcharges.

2. Municipal Capital Gains Tax (paid by the heir on inheriting)

This tax applies to the increase in value of urban land. It’s collected by the council where the property is located. Deadline: 6 months from the death (extendable to 12).

The amount depends on:

• Years elapsed since the last transfer
• Cadastral land value (not the whole property)
• Council coefficients

In Sueca and Valencia this figure can range from a few hundred to several thousand euros. Important: since the 2021 Constitutional Court ruling, if there has been no real value increase between acquisition and transfer, no tax is due. This must be claimed expressly.

3. Income Tax (paid by the heir when selling)

If you sell the inherited property, you pay Income Tax on the capital gain:

Gain = Sale price − (value declared in inheritance + inheritance taxes and expenses)

Current brackets (2026):

• Up to €6,000 · 19%
• €6,000-50,000 · 21%
• €50,000-200,000 · 23%
• €200,000-300,000 · 27%
• Over €300,000 · 28%

A trick nobody tells you: the “acquisition value” is not just what you declared in the inheritance. It also includes notary and registry fees, the municipal capital gains tax paid, and any renovations carried out with proper invoices. This reduces the gain and therefore the Income Tax.

When to sell

In the Valencian Community there is no longer the tax incentive to “wait to sell” that existed years ago when Inheritance Tax was high. With the 99% allowance, the sensible approach is to settle the inheritance and sell as soon as possible if that is the decision, because every month that passes means:

• Annual property tax
• Community fees
• Minimum utility costs (water, electricity)
• Squatting risk if empty
• Property deterioration if not aired

It is only worth delaying the sale if the market is in a clear strong upward trend (not the case in 2026, when stabilisation is expected) or if there is disagreement among co-heirs.

Common mistakes that cost money

1. Declaring too low a value in the inheritance. It looks like you save on Municipal Capital Gains Tax, but later the Income Tax on the sale will be much higher. They must be calculated together.

2. Not requesting an extension if you can’t meet the 6-month deadline. Tax surcharges are 5-20% of the amount due.

3. Selling without registering ownership. Although legally possible, it greatly complicates the operation and reduces the buyer pool.

4. Not checking for property-related debts. Outstanding property tax, pending community levies, unpaid mortgages… the buyer will demand these be settled before signing.

5. Arguing among co-heirs without an objective valuation. 80% of conflicts resolve when there’s an independent professional valuation putting an honest figure on the table.

In summary

Inheriting a flat in Valencia today is not a tax disaster. The 99% Inheritance Tax allowance has made it much easier. What you still need:

1. File Inheritance Tax and Municipal Capital Gains Tax on time (6 months)
2. Register your ownership
3. Get a professional valuation (especially with multiple heirs)
4. Decide calmly whether to sell, let or keep
5. If you sell, calculate the Income Tax on the gain carefully

If you’ve recently inherited and don’t know where to start, a 30-minute conversation is usually enough to set priorities.

This guide is informational and does not replace advice from a lawyer or tax advisor in your specific case. Every inheritance has particularities that should be reviewed.