Sad Cyprus: overseas assets and probate
It’s summer, and we all have holidays on our minds. More and more of us have properties abroad, often in Europe and even further afield. As luxurious and rewarding as these are, they do of course come with a lot of administrative strings attached.
The first hurdle is whether you can leave your property as you wish. Some countries (for example Germany) have “forced heirship” rules which determine how property is to be divided or inherited. This often applies to “immoveable” assets, that is to say, land; but some countries also apply this concept to money and liquid assets as well. So your Will could try to give your overseas assets to your son, but only in vain hope, because in truth the property needs to pass to your spouse.
The second hurdle is “domicile,” a very important (and very vague) concept. You could be resident in the UK, but a Bahraini domicile. In which case, very different tax rules will apply to your estate. Domicile is largely decided by birth and nationality but is also decided with reference to how long you lived in a certain place, your intentions of returning to your birthplace, where you intend to be buried, and many factors besides.
Another hurdle: even with a sound Will (and an appropriate Will for the overseas country in question) and your executors working effectively in the UK, will they be able to deal with the overseas matters? Some countries have very different practices and courts systems. Pragmatically it can be expensive and exhausting, travelling to and from the country, as may at times be necessary.
We have known some clients become very frustrated with companies and law firms abroad, in estates in Spain, Cyprus, Bahrain, Italy and further afield.
Our advice is to have a separate, local Will for the assets in that country, with local, suitable executors in place that you already know and trust. The UK assets can then be left for us to deal with, giving you peace of mind at home and abroad.