Superb news
Submitted by sprostoni on Tue, 07/31/2012 - 07:53
In reply to A newbie all over again! by Annec
Thanks Charlotte, so am I
Submitted by Angie and Robert on Tue, 07/31/2012 - 08:56
In reply to A newbie all over again! by Annec
Yes, Thank you
Submitted by Dylano on Tue, 07/31/2012 - 08:58
In reply to A newbie all over again! by Annec
Thank you, Charlotte.
Submitted by Gala Placidia on Tue, 07/31/2012 - 10:52
In reply to A newbie all over again! by Annec
Charlotte, For those of us
Submitted by Lisa C. on Tue, 07/31/2012 - 22:16
In reply to A newbie all over again! by Annec
In reply to A newbie all over again! by Annec
Replies to queries
Submitted by Charlotte Oliver on Wed, 08/01/2012 - 12:04This is interesting, I have been following the development of the draft Regulation since 2007. It is supposed to be the most ambitious piece of European law to date. Yes, it would make life easier for your heirs if you can all hang on until 2015! The style of will you can choose is unchanged, you can make a will in whatever form you wish, including holographic or purchased from WHS Smith (neither recommended legally but they will probably do the job), as long as it is valid in the country of your residence, domicile or nationality at the time of making it or at the time of your death. The main issue for all expats habitually resident in Italy, or non-Italians living abroad but with property in Italy, is to ensure they have a will with a choice of applicable law, if they do not want Italian law to apply to the division of your estate. If you already have a will, that is still valid. Just check that you have a clause on applicable law, or write a codicil if not. There will now be a debate on how to determine where is your habitual residence. So for those of us that spend time between two or more countries, think about this point to avoid confusion for your heirs, if you pass away withoutleaving a will and have property in Italy. Here is a link to the Regulation in English: http://eur-lex.europa.eu/LexUriServ/LexUriServ.do?uri=OJ:L:2012:201:0107:0134:EN:PDF For dual nationals see Art. 22, you can choose the succession law of any nationality you possess at the moment of making a will or on our death. Sprostoni I hope you like Roccaraso/Castel di Sangro in the summer... Charlotte
inheritance
Submitted by Ugo on Wed, 08/01/2012 - 15:20
In reply to A newbie all over again! by Annec
Thanks so much for the
Submitted by Lisa C. on Wed, 08/01/2012 - 22:02
In reply to A newbie all over again! by Annec
Charlotte I have just been
Submitted by karenr on Thu, 08/02/2012 - 05:15
In reply to A newbie all over again! by Annec
Charlotte I have just been told by a lawyer that you can only choose to have British law apply if you still have assets in UK. We sold up everything in UK and live permanently in Italy thus have no choice but to be ruled by Italian law. Has this changed in the last few days?
Reply to Karen
Submitted by Charlotte Oliver on Thu, 08/02/2012 - 18:35
In reply to Charlotte I have just been by karenr
And nothing has changed!
Submitted by Fillide on Thu, 08/02/2012 - 19:27
In reply to Reply to Karen by Charlotte Oliver
Correct me if I am wrong, but fundamentally nothing has changed. Whether something would have changed had the UK signed up to the treaty, I am not qualified to say - but from experience with a number of successions (UK citizens resident in Italy), the statement within a written will that the estate was to be treated under UK law was respected by four different notaios in the (relatively distant) past. The important thing is to write a will, and not leave it to chance!
Rules are a bit clearer now
Submitted by Charlotte Oliver on Mon, 08/06/2012 - 05:25
In reply to And nothing has changed! by Fillide
It has been recommended for some time that British citizens in Italy write a choice of English law clause in their will, and this is usually accepted in Italy because this is in line with Italian law which states the national law should apply. But there has always been a grey area over the "ping pong" rule which has led to court battles between heirs, claiming that Italian forced heirs hip should apply because of a referral from English law where there is immovable property abroad. And in countries like France it has never before been possible to choose English law if you have property there. I am disappointed that the UK chose not to opt in. Despite years of debate while writing the Regulation there is still confusion about some aspects, and personally I think it is a shame that the UK did not opt in. There will still be a possibility for English law to split applicable law for moveables and immovables, but only where a person dies without a will. the main reason the Uk did not opt in was because of the clawback rule which exists in some members states including Italy. They were lobbied by charities and worried about the effect on trusts. Now if you die without a will, and you are resident in Italy so Italian law applies, a gift made years ago in the UK could be clawed back by the heirs and the value added to the assets before they are divided. There are positive changes in that an heir can obtain a European certificate of Inheritance which will be recognized in all member states, which for example should reduce bureaucracy and costs in closing down bank accounts abroad after a death. Also the jurisdiction for which country's court is competent to deal with disputes is clearer...and everyone should avoid the risk that their heirs have to wait 20 years for an Italian court order!
Just saying...
Submitted by Casa Monal on Tue, 08/07/2012 - 04:39
In reply to A newbie all over again! by Annec
Charlotte, Can you tell me is
Submitted by qui già on Thu, 08/09/2012 - 07:10
In reply to A newbie all over again! by Annec
Donations
Submitted by Charlotte Oliver on Thu, 08/09/2012 - 11:13
In reply to Charlotte, Can you tell me is by qui già
You did not say where the house was but I assume this is in Italy and you are not Italian... The answer is yes but it not highly recommended. You can donate but before the age of 18 there will need to be a court order from the giudice tutelare. Donation is tricky in Italy, because if Italian law applies to your succession, all lifetime gifts can potentially be brought back into the estate for redistribution amongst the heirs. If you simply gift it to your children, and they later try to sell it, this can cause problems, as buyers will be wary that there might be other heirs in the wings who could bring a claim against the property. Potential buyers may find the banks will not give them a mortgage. I have seen cases where donors have to revoke the donation before the property can be sold. Charlotte
Ok, it is in Italy and I am a
Submitted by qui già on Thu, 08/09/2012 - 16:27
In reply to A newbie all over again! by Annec
Donations are used often
Submitted by Charlotte Oliver on Sun, 08/12/2012 - 06:04
In reply to A newbie all over again! by Annec
Donations are used often here, but not for tax reasons, as donation and inheritance tax are the same, and very low, ranging from a few hundred Euro to 3% of the catastal value when donating from parent to child, where the property is worth less than 1 million. maybe my idea of donations here is over cautious but just something to bear in mind and ask the Notary to clarify when preparing the deed. Donations to avoid tax are much more valid in the Uk where by gifting more than 7 years before death the heirs can avoid paying 40% on the market value above the threshold of £325,000. Under the new Regulation if you make a Uk gift, and then move to Italy where you become habitually resident, and die intestate, Italian law will apply to your worldwide succession and the value of that gift could be taken into account when your heirs come to divide up the estate. It is a shame that the Regulation which was drafted to try to keep all member staes happy, is still vague on this and there are still some grey areas. Charlotte
Donations
Submitted by Charlotte Oliver on Sun, 08/12/2012 - 06:04
In reply to A newbie all over again! by Annec
Donations are used often here, but not for tax reasons, as donation and inheritance tax are the same, and very low, ranging from a few hundred Euro to 3% of the catastal value when donating from parent to child, where the property is worth less than 1 million. maybe my idea of donations here is over cautious but just something to bear in mind and ask the Notary to clarify when preparing the deed. Donations to avoid tax are much more valid in the Uk where by gifting more than 7 years before death the heirs can avoid paying 40% on the market value above the threshold of £325,000. Under the new Regulation if you make a Uk gift, and then move to Italy where you become habitually resident, and die intestate, Italian law will apply to your worldwide succession and the value of that gift could be taken into account when your heirs come to divide up the estate. It is a shame that the Regulation which was drafted to try to keep all member staes happy, is still vague on this and there are still some grey areas. Charlotte
You repeat yourself C.
Submitted by stevegwmonkseaton on Thu, 08/16/2012 - 17:29
In reply to A newbie all over again! by Annec
One important question is
Submitted by rickb on Fri, 08/31/2012 - 13:10
In reply to A newbie all over again! by Annec
In reply to A newbie all over again! by Annec
Under English law - if you donate your house to the kids there are two major pitfalls and probably dozens of minor ones. Firstly, freedom from IHT only works as long as the kids are living in the house as well. HMRC doesn't mind that the children own the house, but if the parents are the sole occupants at the time of death, the whole of the property value is part of the estate as they are getting the full benefit of the property. If they are sharing with one child, then half of the value etc. It's just the same with the valuable painting that is "given" to the children but still hangs in the parents' house - "just for safe keeping you understand". HMRC are wise to naive little tricks like that. Secondly, when the children marry, their spouses automatically own 50% of all of their possessions (proceeds of marriage). So when they divorce, the ex-spouse owns part of the family home. Statistically, at least one out of 3 children will divorce, so problems are being built in to such an extent that it may be better to pay the tax. Trusts used to be a fair solution, but in recent years HMRC has targetted trusts quite aggressively. I don't know if it's similar here?
More on donations
Submitted by Ram on Sat, 09/01/2012 - 03:54
In reply to A newbie all over again! by Annec
There is another problem with donations in Italy, in that they can be contested. If you give a house to child A and nothing to child B - it is possible that the notaio will have problems doing a subsequent sale, as child B can always come back and claim half of the property. If donating, try and give equal amounts to all children - as if you can prove that they all got equal dibs then its not possible to contest any donation.
UK domicile and tax
Submitted by Charlotte Oliver on Tue, 09/04/2012 - 18:04
In reply to A newbie all over again! by Annec
.Rickb you are right. The new succession regulation has no effect on tax. So a British citizen could move to Italy and become habitually resident, die intestate and Italian law would apply to his succession, ie the statutory shares would apply to the heirs according to the civil code, but the UK would still be entitled to inheritance tax on the worldwide property if the deceased was still considered UK domiciled. A person is deemed domiciled if they have been resident in the UK for at least 17 out of the laset 20 years.
Succession and tax
Submitted by Noddy on Wed, 09/05/2012 - 13:14
In reply to A newbie all over again! by Annec
My partner is a British citizen, but an Italian resident, domiciled in Italy, with an Italian home and a written will leaving everything to me - as instructed by an expensive lawyer. We are not married. I am a British citizen, living the majority of time in the UK, domiciled in the UK, with my home in the UK. The Italian lawyer said that if we specified in a will that everything was to go to me that it would. I've never been convinced, as the Italian succession law is quite clear. Is that correct? So, if the will is amended to say that British law is chosen, I will then inherit fully? And as the deceased was an Italian domiciled resident, I would get taxed by Italian law and not British? Did I get that right? I've been trying to make sense of this for years and hoped that the solicitor would help but I fear we got duff advice.
The right to choose your succession law
Submitted by Charlotte Oliver on Thu, 09/06/2012 - 11:49
In reply to Succession and tax by Noddy
Noddy, the will that your partner has made is valid, only that without the clause that English law should apply, if you have family members who could claim against your estate, up to now they could possibly have challenged the will successfully in relation to the Italian property. This was a remote possibility and not an attractive one due to the length of legal proceedings in Italy, but it was possible. Now as a result of this new Regulation, if your partner amends the will to include an express choice of English law this will ensure that the deceased wishes are respected. The position is clear now. Most lawyers following the development of this European law have been advising a choice of law clause in a will for the last few years. Just to explain here are two examples. A British national is resident in Italy and has property both in the Uk and in Italy. He makes a will with an express choice of English law (reg art. 22), and in the will leaves his worldwide estate to his girlfriend, excluding his children from a previous relationship. The children cannot bring a claim to be considered statutory heirs of his Italian estate as renvoi to the law of the place of the imoveable property (known as the ping pong effect) is in this situation not possible (regulation art. 34(2) ). Another British national is resident in the Uk but has a holiday home in Italy, where one of his children live, and who he intended to pass the house to on his death. He dies intestate in the Uk leaving 5 children. The Regulation is not in force in the Uk, where English law still states that succession to immoveable property is governed by the law of the place it is situated, and moveable property is governed by the law of the domicile. According to English law, Italian law would apply to the succession of the property in Italy, so all 5 children will be recognised as heirs under the rules of the Civil Code. And the Italian property will be taxed in Italy if the deceased is no longer deemed domiciled in the UK by the HMRC.
Thanks. Thats a relief. No
Submitted by Noddy on Thu, 09/06/2012 - 13:33
In reply to A newbie all over again! by Annec
Dual nationality
Submitted by Ram on Sat, 09/15/2012 - 03:12
In reply to A newbie all over again! by Annec
Hi Charlotte, This may be a daft question, but if I have dual nationality - eg British and Italian, can I still choose British law to govern my succession? Im in the process of getting my Italian citizenship and it has just occurred to me that it may have implications in this regard. THanks
Dual nationality
Submitted by Charlotte Oliver on Tue, 09/18/2012 - 04:24
In reply to A newbie all over again! by Annec
You can choose any nationality either that you have at the time of making your will or on your death. until the Reg is in force, if you are a dual national and oneof your nationalities is Italian, Italian law will apply to a succession opened in Italy. Do any of you agree with the UK not opting in to this? The UK position is that they want to protect British nationals dying intestate in civil law countries like Italy, and their heirs being forced to clawback lifetime gifts made by the deceased. Why did they not just make the clawback rule only apply if the gift was made under the law of a clawback country, ie if it was a gift to charity in the UK it could not be touched.... Charlotte Do
Who knows ...
Submitted by Casa Monal on Wed, 09/19/2012 - 06:10
In reply to A newbie all over again! by Annec
Glad to hear that their intention is to protect UK nationals but yes, if the claw back rule was their only concern, then it would seem logical to opt in with the exception of the claw back rule. Perhaps it wasn’t an option…a case of all or nothing. Difficult to keep up or even understand the EU for us mere lay(wo)man 
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