Why you should make a 'foreign will' for assets abroad

Linda Cummins, Head of Wills & Probate at GWlegal, explains why it might be advisable for owners of properties and assets outside of the England & Wales to make a ‘foreign will’.

Foreign Wills

Do I need a ‘foreign will’ for property and assets I own abroad?

If you are of England & Wales 'domicile' (see explanation below), you can make a will in England with an English lawyer and state that you want it to deal with all your property, wherever that property is located in the world. Alternatively, you can limit your English will to deal with your English assets only and then make wills in the other countries to deal with the assets in those other countries.

Whilst it is not necessary to make a ‘foreign will’ or a will to deal with your assets abroad in other jurisdictions, for various reasons it may be advisable to do so.

What are the benefits of making a foreign will?

Laws in England & Wales vs laws abroad

The main benefit of having a ‘foreign will’ is that a will prepared by the lawyers in the particular jurisdiction will have been done so with knowledge of the laws in that jurisdiction. The laws of the land where your foreign assets are situated will have their own laws concerning valid wills, administration of a person’s estate on death, inheritance laws and tax laws which may not recognise or uphold what you have said you want to happen to those assets in your English will.

For example:

  • English & Welsh law is a ‘common law’ jurisdiction
  • European countries are of ‘civil law’ jurisdiction
  • Islamic nations are of ‘Sharia law’ jurisdiction

Civil law jurisdictions, as an example, do not recognise the concept of trusts and this could cause problems, particularly from a tax perspective if applied in that jurisdiction (eg Spain).

There are also potential issues when it comes to inheritance. Under English law, you can leave your assets to whomever you want. If you don’t include your nearest and dearest in your will, they could make a claim against your estate; but if they do not, your estate will pass where intended and stated in your will. However, in many European countries, such as Italy, France and Spain, and some Middle Eastern and South American countries, laws dictate whom you are to leave your assets to when you die and, by definition, those whom you are not allowed to exclude. These are called ‘forced heirship’ rules and so in those countries, you cannot exclude your children, for example.

As you can see, if you have a will made in England, which says you leave all your property to your friend and not your family, then whilst it is a valid will in England it could be deemed invalid in its application to your foreign assets if situated in a country with forced heirship legislation, and thus creating a potential inheritance dispute.

Delays in administrating the estate

Delays in the administration of the estate are common when there is a single will in a worldwide estate. This is caused by the English will having to go through the probate process here, as well as the grant of probate then having to ‘do the rounds’ and be presented in the foreign country having had the expense of being notarised/legalised to be acceptable to the foreign courts.

The process can be further drawn out by having cross border issues with regards to domicile, the treatment of the asset types and the application of each country’s domestic rules on inheritance. Sending documents abroad also presents the risk of them being lost in transit.

Therefore, having separate wills means the lawyers in those jurisdictions can each proceed with the probate process following death and not have to wait to receive documents from other jurisdictions as part of the probate process.

What does ‘domicile’ mean when writing wills?

Domicile is an important aspect when dealing with any will abroad. Depending upon the domicile of the testator, different rules can apply to the assets of the deceased. However, ‘domicile’ is not the same as ‘residence’. In the England & Wales we apply a different meaning to domicile than other jurisdictions and various factors determine domicile, such as:

  • where you were born
  • where your father was born
  • where you have lived
  • where the assets are located

This is important as where the testator was domicile before death affects how the ‘type’ of assets a person has are treated on death. For example, English & Welsh law states that where the testator is domiciled in the England & Wales, laws apply to both their ‘types’ of assets being either ‘moveable’ here and abroad, and ‘immoveable’ assets here.

Some countries do recognise and accept that some testators who are not nationals of their country want their own domestic laws applied to the foreign assets in their estates. In Spain, for example, Spanish laws apply to all aspects apart from inheritance laws, where they accept the laws of the deceased own country can apply.

It should also be noted that when it comes to inheritance tax, if you are England & Wales domiciled then it can apply to your worldwide assets. There may be a tax treaty in place between the England & Wales and the country where your foreign assets are, so it is very important to review this and get appropriate advice when you are making your will, as there may be ways to mitigate the tax liability.

What is the EU Succession Regulation (Brussels IV) and how does it affect property owned abroad?

In Europe, all countries (apart from UK, Ireland and Denmark) have opted in to the EU Succession Regulation, known as ‘Brussels IV’. It states the laws of the country where someone habitually resided will apply to the property upon their death. The regulation aims to make it easier for individuals to plan their succession in advance and enables heirs to settle estates more quickly. 

For example, if a UK national was habitually resident in England & Wales but owned property in France at the time of death, English succession law in theory should be applicable. However, as each situation has its own complexities, it would be advisable to make a ‘choice of law’ statement clearly in the will to ensure English law applies.

Should I make a foreign will for assets abroad?

Whilst it is acknowledged there are risks of inadvertent revocation when there are numerous wills, it is generally (but not always) advisable to have a will made to deal with the asset in each country where the asset is located, ensuring later wills don’t inadvertently revoke earlier made wills.

Always take advice from a lawyer in the country where the asset is located as to how that asset would be treated on death, along with clearly knowing what your domicile is. It is also crucial that the testator makes each lawyer aware of the existence of the other will(s) and so the lawyer includes an appropriate revocation clause which revokes only the wills that apply in the particular jurisdiction.

Linda Cummins GW Legal

About the author

Linda Cummins is a Solicitor and Head of Wills & Probate at GWlegal@GWlegal.

See also

How to write a will

What happens to a joint bank account when someone dies?

Everything you need to know about fixing mistakes in wills

Find out more

Making a will (Gov.uk)

Wills Act 1837 (Legislation)

Image: Getty Images

Publication date: 26 February 2020