What happens to my overseas assets if I die intestate in SA or testate?  Laws of succession in other countries.

Globalisation caused the divide between countries to decrease as people can now easily communicate across the globe with a single click of a button. This has resulted in more people investing in cross-border transactions, as well as more workers migrating from country to country.

There are specific rules in different countries that govern distribution of assets upon death. Global investors need an estate plan with a well-coordinated approach since emigration has been on the rise increasing the number of South Africans with assets spread across the globe.

It’s important to have a will in place which states how your assets would be distributed upon your death. You should consider having a separate will for your worldwide assets. To avoid any complications, it’s important to make sure your draft will is in compliance with the laws of each country. For example, even though you may have a will for your assets in Mediterranean countries such as Portugal and Italy, the law in these countries automatically splits assets 50-50 with spouses and then divides the remaining 50% equally to any children of the family. 

Even if you have an executor for your estate, they may not know the appropriate succession laws for assets outside of South Africa. In cases when an executor does not feel like they have enough experience to deal with assets in a different country, the executor can appoint solicitors in that country to help.

It is also important to remember that having a separate will for your worldwide assets still necessitates reporting these assets for estate duty purposes in your country of tax residency.

So what happens to your overseas assets if you die intestate in South Africa?  The laws of succession differ from country to country and your assets will be distributed based on the law specific to each country.

In the UK, only married or civil partners and some other close relatives can inherit under the rules of intestacy.  Married partners or civil partners inherit under the rules of intestacy only if they were legally married or in a civil partnership at the time of death.  If there are surviving children, grandchildren or great grandchildren of the person who died and the estate is valued at more than £270,000, the partner will inherit:

• all the personal property and belongings of the person who has died, and
• the first £270,000 of the estate, and
• half of the remaining estate.

In Australia an intestate estate will be divided up between the surviving married or de facto spouse and children. If there is no surviving immediate family, the assets may be allocated to other family members including parents, grandparents, aunts, uncles or cousins.

Mauritius is one of the jurisdictions where forced heirship rules apply albeit on a limited basis in relation to immovable property only. These rules consist of establishing a reserved and unreserved portion of assets. The reserved portion is then allocated to the children of the deceased, and this portion may not be infringed by any testamentary provision. The reserved assets are divided as follows:

• One half (50%) of the estate if the deceased leaves one child.
• Two thirds (66%) of the estate if the deceased leaves two children.
• Three quarters (75%) of the estate if the deceased leaves three or more children.

At death, in case that the testator did not have a will in place, the legal order of inheritance, in descending order of priority, is as follows:

• The descending line and the surviving spouse
• The favoured ascending line (father and mother) and favoured collateral line (siblings and children of predeceased siblings)
• The ordinary ascending line (grandparents, great-grandparents)

The surviving spouse is legally considered an heir to the deceased, although in some cases they may not be a protected heir. This means that their share of the inheritance can be transferred at any time to another beneficiary. However, the surviving spouse also inherits rights as co-owner over the matrimonial home and furniture, until his or her death.

In the absence of any protected heirs, the deceased’s estate will vest in the Mauritian State.

It is prudent to only trust an expert in international succession law with assistance when doing estate planning to avoid complications when your will needs to be executed.  The absolute necessity to have a will, goes without saying.

AED Attorneys understands that every situation is unique, and although they strive to ensure that the information contained herein is accurate at the time of publishing, it cannot be guaranteed to be without errors or omissions. As a result, AED Attorneys, its employees, independent contractors, associates or third parties will under no circumstances accept liability or be held liable for any innocent or negligent actions or omissions in this article, which may result in any harm or liability flowing from the use of or the inability to use the information provided.