Succession Planning in a Post Brexit World
It’s now over a year since the UK’s vote to leave Europe and as the formal negotiations have now commenced, people are wondering - what now?
In terms of succession planning, the effects of Brexit are minimal. However, people we speak with do still have concerns.
It’s becoming more common in today’s society for people to own assets in an EU country, to have work that takes them through various EU countries or simply plan to retire to a sunnier climate. With all these ties to the EU, there are also questions about how this may affect any planning they have undertaken.
Looking at the first of these scenarios, where you have assets in an EU country, you can still plan ahead with a Will here in Scotland.
Generally speaking, the law of succession to your worldwide estate is determined by the country where you have the closest connection. It is a complex area of law and if there is any doubt, it’s something you may wish to seek specific advice on.
If your succession is governed by Scots law, this will remain unchanged and you’ll be subject to UK inheritance tax laws, as before.
There’s an exception to this for heritable property, which has, in the past, been governed by the law of the country where it is situated. Historically, this caused problems as some EU countries have “forced heirship” rules, such as France.
However, the EU introduced a Succession Regulation which means that you can now elect for your country of nationality to apply to all property that you own in the EU.
Our exit from the EU will not alter the position as the Regulation applies to where the property is held, not where you live. Much like you can elect for Scots law to apply to your home in Spain, someone in the USA can elect for American law to apply to the property next door!
We can still deal with your EU-situated assets in a Scottish Will. Of course, there may be other considerations as to whether or not this is beneficial to your circumstances and we would always recommend that you speak with one of our team if you have any concerns.