FAQ - Dealing with inheritance from abroad
The latest figures from the Office for National Statistics estimate around 5.6m Britons live abroad, many of whom own property or draw a pension abroad. When they pass away, their relatives and professional advisers have to go through probate and conveyancing in a foreign country, and the process can often be complex and very time consuming.
We have created this FAQ to explain some of the issues involved when transferring or selling foreign assets for probate.
Frequently Asked Questions
What steps are usually involved for those who need to go through the process of dealing with probate overseas?
What steps can people take to make the process easier?
- Power of Attorney usually needs to be arranged so a legal representative in the country concerned can sign documents on your behalf. This saves time and money.
- The executors of the estate have to be formally recognised as executors by the authorities in the country where the assets are held.
- Documents such as a Will and the death certificate will need to be recognised as official documents by a notary in the UK and will often need to have an official translation
- The property has to be valued by local estate agents
- Local officials will need to be chased-up on a regular basis. It may be essential to speak the language so you are aware of what you are being asked to sign and to avoid mistakes in the process.
- Inheritance tax may need to be paid
- The property may either have to be sold or transferred into the names of the beneficiaries. This would be a similar process to conveyancing in the UK, although be aware the process can involve far more red tape if you are not a national of the country where the asset is held.
How long does it take to deal with overseas probate?
- It is important to seek legal advice as the rules that apply can differ depending on the estate. Seek advice from a firm that understands how probate and conveyancing works in the country where the property or assets are held
- When acquiring a property overseas, try and pre-empt potential probate issues by taking legal advice.
- If you own a property abroad, very often, it helps to have a will drawn-up that is officially recognised by the country where the assets are held. It’s important to have the will translated and recognised as an official document (a process called legalisation) which can also speed up the probate process for relatives.
- It is also important to ensure that any Wills drawn-up do not cancel each other out.
- Understand the inheritance tax rules that may apply to the property and take advice on how you can minimise the tax liability on your estate if you die.
- The process can take between 12-24 months so people often have a long time to wait until they receive their inheritance from abroad. Even some of the most popular countries for the British to buy a holiday home in, like France and Spain, have such different legal systems to the UK that people often struggle to have assets returned to the UK quickly.
Why does the process take so long?
Where is inheritance tax paid on a property or assets owned abroad? Is it in the UK or where the assets are located?
- There are a variety of reasons. Two different legal systems need to be reconciled between the UK and where the assets are held. This involves arranging for documents, such as a Will, to be officially recognised by another country and for official translations to be obtained. Often the entire conveyancing and probate process is in the hands of one town hall official and unless you have a good working relationship with that official, the process can be significantly delayed. Finding a buyer or dealing with sitting tenants can often be a cause of delay. Many European countries have a system of ‘forced heirship’ for property, which means a significant proportion of the estate has to pass to a blood relative, unless you can prove British laws of inheritance take precedence.
- For UK domiciled persons UK IHT is charged on worldwide assets irrespective of where that person lived or where their assets were situated. Domicile is a complex subject but usually you are UK domiciled if you were born in the UK.
Is inheritance tax only payable in one country?
What can be done to minimise IHT on property owned abroad?
- Inheritance tax may be payable arising on death in the country where the assets are situated but Double Taxation relief may also be available if there is a treaty in place.
Are some countries more difficult than others when it comes to dealing with overseas probate?
- Understand the tax rules that may apply to the property, what happens if the property is sold and what happens if the property owner dies. Understand the succession laws and plan appropriately, for example a Will may have to be drawn up in that country. Take advice from qualified professionals and talk to other property owners
How can Title Research help?
- We looked at our own caseload and ranked countries by how difficult they can be when dealing with overseas probate. Some of the most popular countries for owning a holiday home are often the most difficult when it comes to dealing with overseas probate.
|How difficult is it to get assets back from another country after death?
|United Arab Emirates
- We help our clients, by understanding the process (which can be unfamiliar to most people) and handling each step on their behalf. We have very good contacts with local officials and have a good knowledge of the local property market, if a property needs selling abroad. We also have a network of staff in countries around the world with legal expertise of those countries.
See our Overseas Assets
page for more information. For further advice and assistance, please contact us on 020 332 9090 or firstname.lastname@example.org
or fill out our Enquiry Form