When an individual dies, dealing with their estate can be difficult and overwhelming.
Added complexities arise when the individual dies outside of England and Wales because different jurisdictions have different rules for dealing with estates.
If you are acting as a Personal Representative (PR) (for example, an Executor or an Administrator), our Wills, Trusts and Probate Solicitors explore the several things that you must establish at the outset.
The first issue to consider is the deceased's domicile status at the time of death.
PRs must be careful not to focus on where someone lived at the time of their death.
The important concept to consider is where the individual was domiciled, as their domicile will determine which legal and tax system applies to their estate.
The concept of domicile is complicated and depends on the specific circumstances of the deceased.
The domicile status of a deceased person is easier to identify if they were born in one country and lived in that country their entire life, but it isn't as clear-cut if the deceased moved during their lifetime and lived in more than one country.
For example, Scotland, Northern Ireland, England and Wales are each separate countries for the purposes of domicile.
Similarly, each state in the US, the states of Australia, and the Canadian provinces are separate countries.
Everyone will have a domicile of origin, but individuals can shed their domicile of origin and acquire a domicile of choice.
This would involve breaking ties with their domicile of origin.
Some factors to consider include cashing in all their assets in their domicile of origin, acquiring citizenship and passport in their domicile of choice, settling down, starting a family and learning the language in their domicile of choice (amongst others).
There is also the legal concept of "deemed domicile" in England and Wales, which looks at the number of tax years a person is considered a resident for income tax purposes before death.
A PR should seek appropriate advice to establish the deceased's domicile at the outset because domicile affects how an estate is administered and distributed.
If a person dies domiciled in England and Wales, inheritance tax is potentially payable to HMRC on their worldwide assets.
If a person dies domiciled outside England and Wales, then inheritance tax will only be payable to HMRC on their assets held in England and Wales.
As various reliefs and tax thresholds may apply, it is important to take professional advice when assessing the inheritance tax position.
Other taxes may still be payable in other countries depending on where the deceased died domiciled and/or held assets.
A double taxation relief may apply if tax is payable twice on the same asset, but this depends on the agreement reached between the relevant countries.
It is possible that the Deceased left one Will covering worldwide assets or multiple Wills in different countries to deal with specific assets.
These documents will need to be examined in detail, and consideration must be given to the validity of each Will purporting to deal with assets held in more than one country.
Countries have different rules about administering and distributing a deceased person's estate on death.
For example, some countries have forced heirship rules about certain assets.
Instructing a lawyer where the deceased held assets in each jurisdiction will be necessary to navigate these rules.
You must obtain a Grant of Representation (or equivalent document in other countries) to deal with certain assets, including property, shares, investment accounts, and bank accounts, which hold larger sums of money.
You may need a Grant (or equivalent document) for each country where the deceased held assets.
Usually, you will first need to obtain a Grant (or equivalent document) in the country where the deceased died domiciled because this determines how and where tax is paid.
Suppose the deceased died domiciled outside of England and Wales, and a Grant has been obtained in a foreign jurisdiction. In that case, it may be possible to "reseal" the foreign Grant by applying to the Probate Registry in England and Wales.
This only applies to certain jurisdictions, namely Commonwealth countries.
If the foreign Grant cannot be resealed or has not been obtained for whatever reason, then the PRs will need to submit a full application to the Probate Registry in England and Wales for a Grant of Representation to deal with the assets in England and Wales.
In all these scenarios, obtaining certain documentation and information from the lawyer in other relevant jurisdictions will be necessary.
Once the Grant has been obtained or resealed, the PRs will have the authority to deal with the assets held in England and Wales.
At Myerson, our Wills, Trusts and Probate Team offers advice on all aspects of Wills, Trusts and Probate law.
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Aalia has 8 years of experience acting as a Wills, Trusts, and Probate solicitor. Aalia has specialist expertise in Wills, estate administration, Lasting Powers of Attorney, and Trusts.
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