Who Inherits Your Home Abroad? Succession Rules and Wills Explained

Buyers spend weeks choosing a home abroad and rarely an hour thinking about who will own it next. Yet succession is where cross-border property is most likely to cause distress, because the law of the country where the home sits may decide who inherits, how much tax is due and how long heirs wait before they can sell. The rules are knowable, and a few documents written in good time make the process far easier for the people you leave it to.

Two separate questions

Succession planning abroad means answering two questions that are often confused:

1. Who inherits? This is decided by succession law: which country's rules apply, whether children have protected shares, and whether a will is valid.
2. How much tax is paid, and where? This is decided by tax law, which follows its own rules and is not changed by your choice of succession law.

Most expensive mistakes come from assuming that settling the first question settles the second.

Forced heirship

England and Wales, most US states and many common-law jurisdictions allow broad freedom to leave property to anyone. Much of continental Europe does not. France, Spain, Italy and Portugal reserve a fixed share of an estate for children, and in some cases for a spouse. The size of the reserved share depends on the country and the number of children. A will that leaves everything to a surviving spouse may be partly ineffective if children can claim their reserved share.

This matters particularly for blended families, couples who are not married, and owners who want to leave property to a partner rather than children.

The EU Succession Regulation

Since August 2015, the EU Succession Regulation has applied in most EU countries. Ireland and Denmark do not take part, though their nationals who own property in participating countries are affected by it. Its key rules:

• One law for the whole estate. By default, succession to everything you own is governed by the law of the country where you were habitually resident when you died.
• Choice of nationality. You can choose instead the law of your nationality, in a will or a declaration in the form of a will. A British national with a home in Spain can choose English law, even though the UK is outside the EU.
• European Certificate of Succession. Heirs can obtain a certificate that proves their status across participating countries.

So a British owner living in London with a holiday home in Spain will, by default, have the Spanish home pass under English law because their habitual residence is in England. A British owner who has retired to Spain will, by default, have Spanish law apply to their whole estate unless they choose English law in a will.

France's extra safeguard

France has added a protection for children. Under a law passed in 2021, where the foreign law that applies to a succession does not give children a reserved share, children can, in certain circumstances, claim compensation from French assets to restore what French law would have given them. Owners of French property who rely on a choice of foreign law should take specific advice on how this rule might apply to their families.

Inheritance tax still applies

Choosing a succession law does not change inheritance tax.

• Spain charges inheritance tax with large regional differences in allowances and reliefs; heirs may be taxed under the rules of the region where the property sits.
• France charges inheritance tax at rates depending on the relationship between the deceased and the heir; spouses and civil partners are exempt, while unrelated heirs pay a high rate.
• Italy charges succession tax with allowances for spouses and children.
• Portugal applies stamp duty to inheritances, with spouses, children and parents generally exempt.
• United Kingdom charges inheritance tax on UK property regardless of the owner's residence, and on worldwide assets for those within the scope of the UK system.

Some countries have estate tax treaties, but they are much rarer than income tax treaties. Credits for foreign inheritance tax are available in some home-country systems, not all.

Local will or one international will?

Many countries recognise wills made abroad if they meet basic formal requirements. Even so, a local will covering only the property in that country is common practice, because a local notary or court can act on it without translations, foreign legal opinions and delays.

If you have two wills:

• each should state that it covers assets in one country only
• neither should contain a standard clause revoking "all previous wills", unless that is intended
• both should be reviewed together whenever either is changed

How ownership structure affects inheritance

How you buy affects what happens later:

Ownership choice	Effect on succession
Sole name	Whole property falls into your estate
Joint names with survivor rights, where available	Share may pass directly to the co-owner outside the will
Divided ownership, such as a life interest for a spouse and bare ownership for children	Can reduce disputes and sometimes tax, depending on the country
Company or trust	Shares or rights pass instead of the property, but local tax rules may look through the structure

French law offers specific arrangements for couples, including clauses in the purchase deed and marriage regime changes. These are best set up at purchase, not years later.

What heirs will need to do

When an owner dies, heirs usually need to:

1. obtain a death certificate and, where needed, have it translated and legalised
2. instruct a notary or lawyer in the country where the property sits
3. prove their right to inherit, using a will, a European Certificate of Succession or a local declaration of heirs
4. file an inheritance tax return within the local deadline, which can be months rather than years
5. register the change of ownership before they can sell or rent the property

Tell your heirs where the documents are: purchase deed, will, tax numbers, bank details and the name of your lawyer.

Common situations that need extra care

• Unmarried couples. Partners who are not married or in a registered partnership may have no automatic inheritance rights and may pay inheritance tax at the highest rate in some countries. Ownership structure and wills matter even more.
• Second marriages and stepchildren. Forced heirship rules protect biological and adopted children but not necessarily stepchildren, which can conflict with what a blended family intends.
• Owners who move. Moving permanently to the country where the house is located can change your habitual residence, and with it the default succession law for your whole estate.
• Joint purchases with friends or family. Agree in writing what happens to each share on death, so surviving co-owners are not left sharing a house with heirs they do not know.

Start now

Make a will in the country where your property is located, and review your home-country will at the same time. If forced heirship or a choice of national law matters to your family, take advice in both countries before signing. A few hours of planning now can spare your heirs years of paperwork.