It has become increasingly common for British retirees to live abroad and we can often come across probate matters where foreign assets are involved. The presence of foreign assets can be a complex issue in the process of administration of the estate of the deceased. It can pose complex cross-border issues whether or not a valid Will is in place. If you are dealing with foreign assets in the administration of the estate of the deceased, the following matters are to be considered:
- The place of domicile of the deceased at the time of death (domicile is a complex technical term to identity the place/country you live in and substantial connection with)
- Whether the assets include both movable and immovable assets (movable assets are shares,furniture, cars, jewellery, cash in bank and other assets of this nature. Immovable assets are land and buildings)
- The place where are the executors and personal representatives located.
- Determination of tax point
- Is there a lawyer involved in the place assets are situated?
Many countries do not have the concept of executors and look to the heirs to deal with the deceased assets. Law of the place where the property is situated governs the validity of dispositions. It is therefore strongly advised to have a foreign qualified lawyer in place to facilitate smooth progression. A non-resident has absolutely no effect on their liability to Inheritance Tax (IHT). This is because the IHT rules look at two factors (a) the domicile of the person and (b) location of the assets. The process can therefore vary on case to case basis depending on the situation.
Upon grant, the grant of Probate has to be legalised correctly and often within a specific time period before it can be enforceable abroad. It can either be in the form of an “Apostille” or “Legalisation” by the consular office. An Apostille is a certificate issued by the Department of Foreign Affairs (Foreign commonwealth Office) verifying the genuineness of the signature and/or seal of a public officer on a Grant of Probate and the capacity in which he or she has acted. The Apostille procedure applies in lieu of Legalisation between countries that have signed and ratified or acceded to the Hague Convention of 5 October 1961. The countries in which the Apostille procedure applies may be checked on the Hague Convention website, where a list of countries adhering to the Apostille system abolishing the need for legalisation
Legalisation (in some countries spelled ‘Legalization’) is an internationally recognised procedure for certifying the authenticity of official signatures and/or official seal applied to a public document such as Grant of Probate. Still, the verification process is similar; however, it requires the additional Embassy Legalization by the Consular Office of the country in which the document is to be used.