What happens to properties outside of the UK when you pass away?
The rules for what happens to properties outside of the UK when you pass away in England and Wales will depend on the laws of the country where the property is located.
In Europe, all countries (except for UK, Ireland and Denmark) opted in to the EU Succession Regulation. It states the laws of the country where someone was ordinarily resident will apply to their property when they pass away. The regulation aims to make it easier for individuals to plan their succession in advance and enables heirs to settle estates more quickly. However as this was never adopted in the UK, there is no formal recognition of English inheritance law being applicable to properties in Europe after you pass away.
You can technically include overseas property in your will for England and Wales. However, the laws of the country where the property is located may also apply to the ownership and distribution of the property after your death. This means that your will may not be valid in the country where the property is located, and your beneficiaries may not be able to inherit the property according to your wishes.
For example, if you have a property in Spain but are ordinarily resident in England and Wales when you pass away, the Spanish laws of inheritance will apply to the property in Spain. This means that your beneficiaries will inherit the property according to the Spanish laws, even if your will says something different. Spain also doesn’t recognise trusts, so if the property is held in trust, this will not have any legal standing and the property will be subject to any taxes ordinarily due in Spain when you pass away.
If you have properties outside of the UK, you should speak to a solicitor who is familiar with the laws of the country where the property is located. They can help you to make sure that you have a will that is valid in their jurisdiction and that your beneficiaries are able to inherit the property according to your wishes.
There are some additional things to keep in mind:
You may need to appoint a different executor for your overseas properties. You may wish to consider someone who lives locally or a professional executor who speaks the language and understands the law.
You may need to pay inheritance tax in the country where the property is located. The rules for IHT can very significantly between countries, so it’s worth doing your research ahead of time.
You may need to apply for probate in the country where the property is located.
It is important to research the laws of the country where the property is located and speak to a solicitor to get specific advice about your situation.
