Inheritance Rules for Co-Owned Property Shares in Mallorca
The death of a co-owner is never an easy subject — but in a co-ownership model, it’s essential to understand how the transition of ownership works and what happens to the deceased’s shares.
Shares Are Treated Like Any Other Personal Asset
When you co-own a property through a Spanish S.L. (Sociedad Limitada), you legally own shares in a company, not direct title to a physical property. These shares are assets that can be inherited, just like shares in any other company.
Here’s what happens when an owner passes away:
- The shares pass into the estate of the deceased and follow inheritance laws of the country where the person was a tax resident.
- Spanish law does not override local inheritance law.
- The Spanish S.L. continues operating as normal, ensuring zero disruption for other co-owners.
Recognition and Transfer of Shares in Spain
Once inheritance documents are processed in the home country, they are recognized in Spain via:
- A certificate of inheritance
- Proof of identity and legal rights of heirs
- Notification to the Spanish company administrator
Once this process is complete, ownership of the shares is transferred to the heir(s), who can:
- Continue to co-own and use the property
- Or sell the shares via Palmallorca’s secondary market
Taxation Depends on Residency and Treaties
Spain has double taxation agreements with most EU/EEA countries and other major jurisdictions (e.g., UK, USA, Australia). In practice:
- Inheritance tax is paid in the country of residence of the deceased or heir.
- Spain recognizes the inheritance but typically does not tax it if your country of residence handles it.
- If no treaty exists, inheritance may be taxed once locally, depending on the country’s rules.
We recommend consulting with your local tax advisor to ensure compliance and clarity.
A Real-World Example
Let’s say an owner from Denmark passes away:
- Danish inheritance laws apply.
- The shares in the Spanish S.L. are listed as part of the estate.
- The Danish estate executor coordinates with the administrator of the S.L. to update the owner’s book and transfer shares.
- If the heirs wish to sell the shares, they can do so via Palmallorca’s secure marketplace.
Selling Inherited Shares Is Straightforward
If heirs or estate administrators prefer to sell, Palmallorca offers:
- A secure secondary marketplace for co-ownership shares
- Auction logic (optional), where a minimum price is set and interested buyers can bid
- First right of refusal for existing co-owners at the same third-party price
This ensures a market-driven process while protecting co-owner alignment.
Summary: Inheritance Without Headaches
- You co-own shares in a Mallorca-based company, not the property directly.
- If you pass away, your heirs inherit those shares.
- No need to “sell the property” — the structure stays intact.
- The company administrator updates the owner’s book, and shares can be retained or sold.
- Palmallorca supports all parties with clarity and discretion.
Learn the Full Co-Ownership Solution
Palmallorca Co-Ownership is a complete, transparent model for smart second-home ownership in Mallorca — built around legal clarity, local support, and personal freedom. Explore the full series below to understand how it works and why it’s designed for the way people live, invest, and travel today.
Why Mallorca – And Why Now?
Discover why Mallorca remains one of Europe’s top lifestyle destinations — and why timing matters.
From Dream to Keys – How It Works
A practical guide to how we match co-owners and form your co-ownership group.
Who Buys Co-Ownership in Mallorca?
See the real people behind the model — from digital nomads to retirees and wellness seekers.
What You Really Own – Legal & Company Structure
Understand the secure ownership structure via Spanish companies and your rights.
Company & Tax Administration Made Easy
No headaches — all financial and legal admin is handled locally on your behalf.
Personal Taxation in a Mallorca Co-Ownership Model
Understand how private taxation works for co-owners — simple, fair, and legally secure.
The Cost & Operations Behind Co-Ownership
What your investment includes, how costs are shared, and what it means in practice.
How the Booking Rules Work
A smart system for using, rotating, and renting your weeks fairly.
The Owners Agreement – Shared Rules
How decisions are made, upgrades are approved, and everyone’s rights are respected.
Selling Your Shares – A Clear Exit Path
Exit easily through our resale and auction platform, with first rights for co-owners.
What Happens If a Co-Owner Stops Paying?
Built-in protection ensures others are not affected if someone defaults.
Legal Rental Rights for Co-Owners
Rent legally with transparency — learn how our 4-week rental logic works.
Property Management – Daily Care & Guest Prep
How the property is cleaned, managed, and prepared for each co-owner or guest.
Upgrades & Improvements – Owner Votes & Budgeting
How new ideas and improvements are proposed, voted on, and funded.
Can I Use My Weeks Flexibly or Swap with Others?
Yes — swap across seasons or even with other Palmallorca Co-Owners.
Want to Learn More?
Explore how you can own a slice of paradise — without the burden of full ownership.
