CKT

Changes to Inheritance Law

Under new EU succession regulations, which came into force on Monday the 17th of August, Irish property owners are now able to decide to whom they wish to leave their properties in certain countries. Ireland, the UK and Denmark opted out of the regulations but Irish residents who have holiday homes in places such as France, Portugal and Spain are able to benefit from the rules.

The rules allow people the freedom to choose that their own country’s succession laws apply on their death which will avoid what are referred to as “forced heirship” rules applicable in many EU countries presently.

It is however important to note that the regulations do not have any bearing on inheritance tax rules which remain unchanged. It may be beneficial for Irish property owners to change their wills in the country where their property is to state they want Irish law to govern their estate. Irish property owners of overseas properties should review their wills and tax planning in light of the new rules to ensure they are not exposed to large tax bills.

While this may be good news for many people, we will have to wait and see how it pans out in practice.