… then German Succession Rules do apply to the Estate!
Since August 2015, all EU members (except for UK, Ireland and Denmark) apply the same basic rule: The national succession laws of that country shall apply in which the decedent had his or her last habitual residence (EU Succession Regulation, EU 650/2012).
Thus, if your parent or your child has been permanently living in – for instance – Germany, France or Spain and sadly dies while having been resident there, then the national succession rules of Germany, France or Spain will govern the administration of the entire estate as well as the formal probate proceedings.
This can create some surprising results for everyone involved. Intestacy rules, for example, vary from country to country. And, even more astonishing for English relatives and their lawyers, many European countries know a concept of “forced inheritance” or “statutory share rules”.
Under French law, a fixed proportion of the estate (of at least one half) is inherited by the child or children of the deceased, irrespective of the testator’s wishes as expressed in his or her will (“forced inheritance”). In Germany, the situation is similar: the surviving spouse, children and even the parents of the deceased are entitled to make a significant financial claim against the heir(s), the so called Pflichtteilsanspruch (details here).
Not every British or Irish national who lives in Germany (or France etc) is aware of this. And even if they are aware, then some of these national succession laws are mandatory and indispensable. Thus the term “forced inheritance”. For the surviving spouses, children or parents of a British or Irish national who passed away in Europe, this means that they may be entitled to an interest in the estate even if they were disinherited. In other words: German or French succession laws grant the close relatives certain rights they would not expect to have under English laws.
There are, however, also unpleasant surprises and risks: Under German as well as French laws, for instance, the heirs inherit their share of the property of the deceased directly on death and also assume personal responsibility for the debts of the deceased (even if they are at first unaware of such debts) and the tax on inheritance.
In all international inheritance cases, the relatives of the deceased should thus obtain information on the local succession laws and probate rules to avoid risks of personal liability and to find out whether they are entitled to a forced inheritance.
For more information on probate as well as gift & inheritance tax in Germany, Austria and Switzerland see the below posts by the international succession law experts of Graf & Partners LLP:
- The Perils of German IHT and Gift Tax
- Can foreign Taxes be set off against UK Inheritance Tax?
- Brochure on German Probate and German Inheritance Tax (in English)
- German Tax Clearance Certificate (Inheritance Tax)
- Careful with Deeds of Variation in German-British Inheritance Cases
- Efficient Transfer of Foreign Assets
- Most Germans die without a Will (German Intestacy Rules)
- Formal Requirements to set up a valid Will in England, Scotland and Germany: What are the Differences?
- Basics of German Inheritance and Succession Law
- Executors and Trustees in German Inheritance Law
- How to apply for a German Grant of Probate
- The Infamous German Community of Heirs – And how to avoid it
- International Wills and Estate Planning for British-German Families
- Prove German Wills for English Probate
- Disputed Wills and Contentious Probate in Germany
- Disinherit your no-good children? Not so easy in Germany
- Don’t be afraid of Clients with Foreign Assets!
Or simply click on the “German Probate” section in the right column of this blog.
– – –
The law firm Graf & Partners was established in 2003 and has many years of experience with British-German and US-German probate matters. If you wish us to advise or represent you in a German or cross border inheritance case please contact German solicitor Bernhard Schmeilzl, LL.M. (Leicester) at +49 941 463 7070.