No Mr Brindley, I did not write that. 99.99% of properties in Spain are below 500k, so no one would pay this tax then which is just not feasable.
If you take up residency in Spain either of you (the inheritor) will have an allowance of 122.604,47 Euros (maximum reduction) on your taxeable assets worldwide.
If you are not resident you do not have such an allowance and will pay on any asset whose value is over approximately 8.000€ onwards starting at 7.65% and reaching as high as 34% (over 800.000 € approximately).
There are allowances between husband and wife as inheritors of 16.000€.
There are general rules (general regime) and specific rules for each community in Spain. Please take advise from a lawyer ot Tax Advisor on your specific area. In some communities in Spain the Inheritance Tax has been abolished. Moreover, for many British it is not recommendable to become fiscal residents in Spain because they will pay for assets which in the UK are exempt (so they end up paying even more than they would there).
Obviously, the same as in the UK, if you have already bought the property in Spain under your names and after you decide to put it under tha names of your children (so as to avoid inheritance tax) you still pay the Gift Tax, as it is obvious.