The Complications of Cross-Border Estates
Nowadays, people are leading increasingly international lives, and this brings its own rewards and challenges. Jobling Gowler offer bespoke solutions and advice regarding cross-border estates that take account of their complex nature. For example, we can provide tailored advice if you have assets in a different country, a partner who is a foreign national or other relations who are living or working abroad. We specialise in working closely with professionals in different countries to ensure you receive correct and up to date advice. Unfortunately having a will in a foreign country is not sufficient to protect your estate. By getting to know your personal situation, we can consider your specific needs and put together a plan which meets your long term interests and goals.
When dealing with cross-border estates, it is important to note the differences between international legal systems. There are a number of factors which require consideration when resolving conflicts between them. In England, for example, people can leave their estates to almost anybody they wish, whereas in some foreign countries this is not the case. Some countries impose ‘forced heirship’ where the law requires you to leave certain portions of your wealth to family members.
Where you were married can also have an effect on what happens to your estate after you die. For example, if you get married in a foreign country then a ‘matrimonial property regime’ may apply. This may entitle your spouse to some of your assets before anyone else (in addition to forced heirship).
Furthermore, different countries will follow different rules when applying taxes to your estate. In England, HMRC use a person’s ‘domicile’ to determine how to apply Inheritance Tax. On the other hand, foreign countries often use nationality or ‘habitual residence’. This is a very different classification to domicile, and could result in both countries claiming the right to tax your estate! We can provide advice on your residence so that you have a clear idea of your Inheritance Tax position.
Tax is also an important factor to consider if some of your beneficiaries live abroad. Although English law taxes the estate of the person that has died, some countries apply tax to the beneficiaries instead. This could mean people have to pay tax twice on the estate, firstly by the person who died in England (i.e. you), and again by the beneficiary living abroad. Your beneficiaries may therefore receive a smaller inheritance than you had intended. It is important to understand how tax will apply to your estate and beneficiaries so that you can make the appropriate provisions.
Can We Help You?
Jobling Gowler can help you to prepare your estate and deal with issues arising from cross-border estates. Our probate specialist Paul ClarkTEP has been awarded the advanced certificate in Cross-Border Estates from STEP, which is a leading qualification for solicitors practicing in this area of law.
Please contact us today to arrange an initial free consultation on 01625 614250 or complete the enquiries form below: