Inheriting assets can bring unexpected costs and sometimes associated debt. This article explains how the inheritance process works in Portugal, the costs involved and how to manage delicate situations to avoid future financial problems.
What are the costs of an inheritance?
Since 2004, direct heirs (children, spouse or parents) have been exempt from paying tax on inherited wealth. However, this exemption does not cover the mandatory bureaucratic expenses to transfer and register the assets.
The first step is the qualification of heirs, a process that identifies the legal beneficiaries. This step can be carried out at a Notary’s Office or at the Inheritance Counter, and requires filling out Model I of the Stamp Tax. If there is no consensus on the division of assets, an inventory will be necessary, conducted by notary offices since 2015. The costs of this procedure vary according to the assets.
Inherited assets also need to be registered, a process that includes indicating the Tax Patrimonial Value (VPT) of the properties and paying notary fees. These costs can exceed €400 in bureaucracy alone.
Inheritances with debts
Inheriting assets can also mean accepting financial responsibilities. The deceased’s debts, such as mortgages or loans, pass to the heirs, but are limited to the inherited assets. If the burdens outweigh the benefits, the heirs may refuse the inheritance. This decision must be formalized with a notary or court.
Credit consolidation is an option for those who choose to accept an inheritance with debt, as suggested by . This process allows you to group several obligations into a single credit, reducing monthly charges and facilitating financial management.
Debts that are not transferred
Not all of the deceased’s debts are passed on to heirs. Obligations related to fines or administrative offenses terminate upon death, in accordance with the General Regime of Tax Offenses. However, loans, mortgages and credit card debts are transferred to heirs, reinforcing the importance of good financial management and preventative measures, such as life insurance.
How to avoid problems with inheritance?
Renunciation of inheritance is a solution in cases of negative assets. Another measure is to take out life insurance associated with credits, ensuring that financial obligations are not passed on. For anyone planning to leave assets, it is advisable to maintain strict financial management and inform heirs about the economic situation.
The inheritance process in Portugal requires attention to bureaucratic and financial details. Knowing the costs, rights and obligations is essential to avoid surprises and ensure efficient management of inherited assets.
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