Tens of thousands of over-50s in the North West who own a holiday home abroad may end up passing it on – against their will and their dying wishes – to the wrong beneficiary.
Probate lawyers at SAS Daniels LLP say that a recent opt-out by the United Kingdom from European Union laws on succession has highlighted previously barely-known problems disposing of foreign assets on death.
Several European countries have “forced heirship” laws, which say that certain types of assets must be passed, for example, to offspring when the owner dies. These laws are already catching people out.
Ten per cent of North West over-50s own a holiday home abroad, with 12% of them owning property in France, where forced heirship is becoming a bigger and bigger issue for Brits living abroad.
“Buying property abroad has been largely off the radar during the recession and because of the weakness of the pound against the Euro, but buying is now beginning to make a comeback,” said SAS Daniels LLP.
“Although the United Kingdom opted out of the EU Succession laws, many European countries do abide by the forced heirship rules which can and do cause a vast array of problems.
“For instance, how many of us travel in France and see gorgeous but abandoned properties that are screaming out to be bought and turned into holiday homes? Well, the reason they’re empty and unused – and falling apart – can be the forced heirship rule, with properties having as many as 30 owners from an extended family; it would be virtually impossible to trace every one of those owners.
“But not only does that mean it can be difficult to buy, it can also make life very complicated if you own a foreign property, because the rules are generally the same for British ex-pats as they are for locals. If the owner dies, then the property may have to go to the children and you may not be able to leave it wholly to your spouse.
“Lifetime ‘gifts’ of ‘non-moveables’ such as property can also be clawed back to meet France’s heirship rules.
“It’s a classic example of a dream potentially turning into a nightmare – buyers really do need to be aware of these complicated European laws, and they really should consult professional advisers – because the powers of a will may be limited as a consequence, and could well cause massive complications when it comes to assigning the estate.”
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