Why Expat Wills Are Even More Critical & How to Set One Up

Succession planning and expat wills can be tricky to navigate. But it's even more critical that if you have financial interests in multiple jurisdictions you ensure your assets - and loved ones - are taken care of appropriately in the event of your death. So wills for expats are always top of our priority list when assisting our global client base. Inheritance and tax laws differ in every country. So it's essential that you have an understanding of what will happen to your estate, as well as how to avoid any potential problems. Writing a will doesn't have to be complicated or expensive. In fact, it's often the simplest and most effective way to ensure your family is provided for after your death. If you need urgent advice about writing a will as an expat, we're here to help right now.

Why are wills even more essential for expats?

Writing a will as an expat

Starting with the basics. A will is a legal document. Your will allows you to dictate the distribution of your assets after your death. It’s important for every adult of any age to have a will. That’s because it ensures your wishes are known and honoured, even in the event of an unexpected tragedy like a car accident or sudden illness.

When you die without having made a valid will, it is called dying intestate. This means that if you don’t make a will, your hard-earned assets may be distributed according to the rules of intestacy. And when this happens—more often than not—the result is that your loved ones could lose out on what you intended for them.

Expats have even more reasons to make sure their will is up-to-date and valid. Where you live at the time of your death will determine which country’s rules and inheritance laws apply. Your residency and domicile status can make things pretty complex, and you’ll need to ensure your will meets the requirements of the country where you live.

If you do not have a valid will as an expat, you could risk the following consequences:

  • Assets may not end up going where you want them to
  • Family members could spend years trying to untangle your financial affairs across several jurisdictions
  • Assets may be greatly reduced by unnecessary tax
  • Loved ones may be left with large legal bills if they are forced to make a claim against the estate

Inheritance issues to be considered in expat wills

When writing your will as an expat, who your assets will go to isn’t the only thing you need to think about. You’ll need to think about inheritance tax and what might happen to your assets. You’ll also need to think about the succession laws of the country where you’re resident and where you are considered domiciled.

More about domicile, residency and tax status

Understanding your residency status and your country of domicile is an important status to consider alongside expat wills. This will have a huge impact on how you make your will and its execution when you die. When it comes to wills and taxes for global expats, much of what happens after your death depends on extremely complex distinctions around what constitutes your country of residence and your domicile.

There are a couple of domicile concepts. One is determined by where your parents were born – known as your domicile of origin. The other is based on where your permanent home is – not where you’re resident for tax purposes.

You may have a complex mix of residency, ordinary residency, domicile and domicile of origin issues that impact inheritance tax and succession laws. These matters have a significant bearing on the management of your estate – so it’s extremely important you get expert advice.

Inheritance tax for expats

If you have assets in multiple countries or multiple residences, it’s entirely possible your estate may be taxed in one than one country. To ensure you pass on as much of your estate as possible, you’ll need expert professional advice that can untangle all your international financial affairs and work out exactly what your successors might be looking at upon your death.

Succession law for expats

The laws of succession and how they’re applied to your estate will depend on the scope of your will, the laws in your country of domicile and the laws in your country of residence.

Some wills can have worldwide validity. Others will be valid in most countries, with exceptions. Some may only be valid in one particular country.

You must consider the willingness of any foreign jurisdiction to recognise a will made in another country and how this will influence your succession planning.

Many European countries – like Scotland, France and Spain – operate a system of forced heirship. This means that heirs may have legal rights that trump what you specify in your will.

wills for expats in france

How should an expat set up a will that caters for cross-border inheritance issues?

Get advice about writing a will as an expat

Expert advice from an independent financial adviser with experience in international estate planning is a must. Find out more about our will planning services here.

Appoint an executor (or executors)

The executor of your will is the person who will carry out your instructions. It’s common to nominate at least two executors. This is because if your sole executor isn’t around or available when you die, the courts would need to appoint one and the cost would come off your estate.

Appointing someone who lives overseas can also complicate matters, as this may affect the tax residency status of your estate.

Identify someone to give power of attorney to

This is a legal document that gives another person the authority to make personal and medical decisions on your behalf if you’re not able. You can specify which responsibilities you want this person to have (like making end-of-life healthcare decisions).

Choose temporary and permanent guardians for children

This is essential for all parents of children under 18 – but especially critical for expats. Global families must think about whether children will need to move countries to live with their appointment guardian/s. If your permanent guardian lives overseas, identify temporary guardians who can step in on an interim basis.

expat wills

Identify your beneficiaries

These are the people or organisations you want to receive portions of your estate. An heir is not the same as a beneficiary. An heir refers to a blood relative who may have an entitlement to the estate – but unless they’re named in your will they aren’t necessarily a beneficiary. You can name overseas individuals as beneficiaries, but there may be tax issues. You need the help of someone who understands the implications in all countries involved.

Allocate cash gifts

Secondary to the beneficiaries of your estate, you can leave cash gifts for individuals or organisations. Cash gifts can be tax-free if they’re under a certain amount and can be a way to factor mitigating inheritance tax into your succession planning.

Consider what happens to your businesses

If you’re a business owner, you’ll need a succession plan. You’ll also need to bear in mind that your business or your share of it is part of your estate. It could end up being split amongst multiple beneficiaries, making things complicated.

Register your expat will in local jurisdictions

In many jurisdictions, so they can legally recognise your will you will be advised to register it in local courts. This is particularly true in the UAE In Dubai you should register an expat will at the Dubai courts or the Dubai International Financial Centre. If registering at the former, you’ll need to have your will translated into Arabic.

wills for expats in dubai

Find out whether you need separate wills for separate countries

Consider whether you need multiple wills – and how they can co-exist without revoking the other. Writing a will as an expat means you might need to make separate wills that cover the assets held in specific jurisdictions. But usually, the most recent will revokes any previous wills. So tread carefully.

We are here to assist you with your estate planning needs and specialise in expat financial issues. Find out more by contacting us today.