It is becoming much more common in recent years for clients to own assets abroad, such as holiday homes or second homes. Most, if not all, WillPack members come across clients with assets abroad at some stage during their estate planning career. When taking instructions, two of the most important questions you can ask is ‘do you have assets abroad?’ and if so ‘do you have a Wills abroad in the respective country?’. Clients will rarely disclose this without being prompted, but not ascertaining this can have grave impacts for a client’s estate planning.
No Wills Abroad
If the client does not have a Will to cover their foreign assets, we can draft their Will to cover their worldwide assets but WillPack are not able to confirm how successfully their English Will would gift foreign assets. We would therefore recommend that the client seeks advise in that country and possibly writes a Will for their assets in that country. The Will in that country should be written so that it does not revoke the English Will.
A foreign Will to deal with those assets may be advisable for a number of reasons:
- A legal professional with expertise of the foreign laws will be able to advise on any problems of inheritance in that jurisdiction arising from fixed inheritance laws.
- A Will made in the language and form of the local jurisdiction will be familiar to local institutions and will, therefore, make it easier to deal with those assets.
- Civil law and Islamic jurisdictions do not recognise the concept of executorship in its English sense and assets usually vest in the heir direct. Executors appointed under an English Will are, therefore, unlikely to be able to take any effective steps to acquire title to the foreign assets.
If a client has a Will abroad, you should inform us of this in the instruction form. We will then limit the scope of the English Will so that it does not cover assets in that country and also limit the revocation clause so that the will does not revoke the foreign Will. Without knowing that there is a foreign Will in place, the English Will will include a general revocation clause that to revoke all former Wills, which would include the foreign Will.
EU Succession Regulation (Brussels IV)
EU Succession Regulation (EU 650/2012), also known as Brussels IV, came into effect on the 17th August 2015 and is binding upon all EU member states except for the UK, Ireland and Denmark who all opted out of the regulation. The intention behind the regulation was to simplify succession rules across the EU and allow and individual to be certain what law will govern the succession of their assets in the EU.
As a general rule under the regulation, the law which will apply to an individual’s estate will be the law of the country where they are habitually resident at the date of death unless the individual was ‘manifestly more closely connected with another state’.
Where there could be uncertainty concerning an individual’s habitual residence or where they are manifestly more closely connected to another state, Article 22 of EU 650/2012 allows a testator to choose the law of their nationality to govern succession as a whole and this can be achieved by making a choice in their Will.
The reason why Brussels IV was brought in was in order to simplify succession rules between EU member states and was intended to allow individual’s to be certain as to what law will govern succession of their assets situated within the EU and relates to deaths which occur on or after the 17th August 2015.
Although the UK has not opted in, Brussels IV is still relevant to any resident in the UK who holds assets in any other EU state other than Ireland and Denmark. Please note that Brexit will have no effect on this as the UK did not opt into the regulation and the law that applies to the succession of EU assets does not need to be the law of another EU member state.
We do not recommend that clients rely solely on Brussels IV and still recommend that clients seek advice in the country in question as we cannot advise exactly how each EU country is interpreting the regulation and there may still be reasons for writing a Will in that country.