New EU inheritance laws
The European parliament has back proposals which will bring in regulation that would change the way succession and inheritance is dealt with across the EU. The inheritance procedure will become much easier as you will be able to elect British law in your Will to apply to assets you hold abroad. The New EU inheritance laws should prompt more people to right a will say experts, reported in the law Gazette.
Under the new regulations, a British man who settles in France, for instance, could designate in his will that his assets be distributed according to the British laws of inheritance. This means he can pass his estate to whoever he chooses rather than using the French laws of ‘forced heirship’ which govern how assets are passed within a family.
The changes are hoped to help avoid the disputes that occur when a person leaves a Will in more than one Member State.
Over sea’s inheritances account for ten per cent of all successions in the European Union, according to Kurt Lechner, who was influential in passing the proposals through parliament.
The changes will also establish a European Certificate of Succession, which will safeguard inheritances and the rights of beneficiaries, in much the same way as a memorandum.
The EU regulation 650/2012, also known as Brussels IV came into place on the 17th of August 2015. Out of the 28 member states, 25 signed up. The UK, Republic of Ireland and Denmark opted out of the regulation.
With the regulation in place, the default position of the law is that upon death any assets held by the deceased will be governed by the laws of the country of which the person held habitual residence or nationality. The regulation also allows for that person to override this default position and to dictate in their will which countries law they would like applied to their estate, their country of habitual residence, their country of nationality (people with multiple nationalities can choose any of their nationalities) or the country where the estate/assets are situated.
The UK has opted out of the regulation, this means that you cannot elect in your will to apply foreign law on British assets. However, a British person can elect for British law to be applied over foreign law on assets they hold in a participating EU Country.
If you have habitual residence in the UK or are of British nationality and die without a Will, known as ‘dying intestate’ the English ‘Conflict of laws’ rule will be applied which says that immovable assets such as land or residential property is governed by the law where the assets are located.
In order to get the best out of the New EU inheritance laws it is important to have a well written will which nominates the laws of the country that you want applied to your assets. You can do this by specifically references them in your British will this however means your Will and testament will have to be validated in the foreign country where you hold assets. You could alternatively keep the estates separate by writing a will in the country where the property is held stating your decision to use British law. This can be a simpler route and can save time and money when it comes to the estate administration.