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Waiving a foreign inheritance

If you are the beneficiary or heir of an estate with assets abroad, it may be that you do not want to receive the inheritance and would like to waive or refuse your right to receive the foreign inheritance.

There are a number of reasons why a beneficiary may want to reject their inheritance, such as:

  • Accepting an inheritance may mean that you inherit not only the assets but also the debts too. This is the case in countries such as Spain, Italy, Germany and many others too. So, in circumstances where the value of the debt outweighs the value of the assets, it can be advisable to waive your inheritance.
  • Inheriting an estate may create an additional inheritance tax liability for you or your own estate and you may feel that renouncing the inheritance in favour of another person (e.g your children) would be more tax efficient.
  • You just don’t need the money or feel that others are more in need and would prefer to disclaim your inheritance so that someone else benefits.

Can you disclaim a foreign inheritance?

The ability to waive a foreign inheritance and the process to be followed all depends on the national law that applies to the estate. Determining which national law applies to the estate is crucial and should be ascertained before you decide whether to accept or decline the inheritance.  The applicable law will determine the effect of the waiver and the process to be followed.

How do you disclaim a foreign inheritance?

It is usually the case that you must take steps to formally renounce the inheritance otherwise, if you do nothing, you may be deemed to have accepted the inheritance after a certain period of time.

To waive your inheritance, some form of formal written waiver or disclaimer of interest is therefore usually required. This waiver/disclaimer will usually be prepared by the lawyer/notary in the country where the estate is located. The formal waiver will usually need to be signed in front of a Notary Public in that country or in your own country or at an embassy/consulate.

There is usually a legally specified time period in which you must submit the disclaimer, which can vary from a few months up to several years depending on the country. The time period can also be different for beneficiaries who live abroad.

What should you consider before waiving a foreign inheritance? 

In some countries, including Italy, Spain and Greece, a waiver of an inheritance must be total and cannot be partial. So, if you choose to reject your inheritance you must waive your right to the entire inheritance. For example, if there are assets in one country and debts in another, you cannot accept the inheritance in one country and refuse the inheritance in another. However, in some instances and some countries, such as France, you may be able to disclaim only some aspects of the inheritance.

Disclaiming a foreign inheritance can have serious implications for your own heirs. For instance, if you wish to waive an inheritance because the estate is burdened with debt, this debt may pass on to the next in line to inherit. If they choose to waive the inheritance, their heirs may inherit the debt and so on. So, you may wish to consider the implications that waiving an inheritance would have on your own children and grandchildren.

If you disclaim an inheritance in favour of another person, in some countries, such as Spain, this would be considered to be a gift and you may therefore be liable for two lots of taxation i.e. inheritance tax on your inheritance and then gift tax on it passing to another person.

Once you have officially rejected a foreign inheritance you cannot usually change your mind. So, you should be certain that you have made the right decision before disclaiming your inheritance.

Needless to say, dealing with inheritance matters in a foreign country can be complex. So, it’s crucial that you seek legal advice before deciding to whether to disclaim a foreign inheritance.

If you need advice on how to accept or reject a foreign inheritance in Spain, France, Italy, Greece or any other country, contact Worldwide Lawyers on 01244 470 339 or email us at info@worldwidelawyers.co.uk. Our friendly and knowledgeable team will be able to provide assistance and put you in touch with an English-speaking lawyer in the required country.