By: BILL BLEVINS
Bill Blevins is Managing Director of Blevins Franks. He has specialised in expatriate investment and tax planning for over 35 years. He has written books and gives lectures on this subject in Southern Europe and the UK.
IT IS imperative that expatriates living in Portugal have Wills which are appropriate to the national laws of the country. It is normally necessary for most UK expatriates to have at least two Wills, one for the assets in the country they are resident and one in the UK covering assets located outside the country of residence.
If a Will is made in another country, covering Portuguese assets, then it will be necessary to get the grant of probate (or equivalent) from that country before the Portuguese estate can be wound up. This results in unnecessary delay and expense.
When making a foreign Will, you will need to observe the local law regarding succession. In most Continental European countries, your children have a statutory right to an inheritance and, whatever your Will says, the statutory provisions may be used to override your wishes.
In Portugal, the law provides that matters of succession are determined in accordance with the personal law of the deceased. An English national, therefore, is free to leave his assets to whoever he chooses. However, if you are both a foreign national and a Portuguese national then, at least so far as assets in Portugal are concerned, Portuguese succession laws will apply.
Under Portuguese succession laws, a Portuguese national is not free to leave his assets to whoever he wishes. Various close relations have an entitlement to the deceased’s estate which cannot be overridden by the terms of a Will.
Some of the most important considerations regarding the establishment of your Will are detailed here:
Think carefully about appointing or changing executors, particularly if the Will is to establish ongoing trusts for children or grandchildren. Your executors will be the trustees of those trusts, and it is sensible to choose executors who are young enough to see the children through at least their growing up years. A family member or good friend who knows the children well will provide a useful link between them and the trustees.
Adding a professional executor, who will provide guidance on the not uncomplicated responsibilities of trustees, will also provide someone outside the family who could be responsible for difficult (even unpopular!) trustee decisions (“no Jason, you may not have a Ferrari”), thus keeping disputes outside the family circle.
At a difficult time for any family, the last thing wanted is uncertainty about the form the funeral should take, particularly if it leads to family dissension. Legally, the body is an asset of the estate and belongs to the executors, although most professional executors will leave the decision on funeral arrangements to the family. A sensible idea is to make clear in the Will itself what form the funeral should take.
Anyone with children under 16 years must make a Will to protect their inheritance, and should make a point of inserting a testamentary appointment of guardians for the children. The appointment of a guardian by Will requires no other formality and allows you to be certain that your children’s interests will be safeguarded by the person you consider to be best suitable to do that for them.
In the UK, the role and responsibility of guardians is set out in the Children Act. Contrary to popular belief, the children do not necessarily have to live with the guardian.
Letters of Wishes
It is often the small things that cause the greatest unhappiness in families and a disagreement over sharing out jewellery, paintings or silver is a difficult source of conflict to resolve. This can be circumvented – or at least the responsibility for the disagreement rests with the deceased – by the simple expedient of specifically allocating these gifts under the Will, in a Letter of Wishes.
It is no longer necessary to spell out every gift in the Will, leaving the Will to be changed whenever the intentions are revisited. All these items, under the general heading of “personal chattels”, can be left to the executors to distribute according to a letter left with the Will. The letter can be changed as often as necessary, without formality and although it is not legally binding, the confidence extended to those appointed as executors will extend to being sure that they will honour the wishes.
Owners of property in Portugal are sensibly advised to make a local Will to deal just with that property, either for reasons of local law or because it makes things easier when the time comes to wind up the estate to deal with a property under a local Will.
If you make a Portuguese Will, and subsequently change your English Will dealing with the rest of your estate, it is essential that your solicitor knows about the Portuguese Will, and sees that it is mentioned in the new English one. The practice in drawing up English Wills is to include a provision that automatically revokes all earlier Wills, and without adding the reference this could inadvertently revoke the Portuguese Will with quite unintended consequences.
It is a fact that the vast majority of individuals do not make adequate provision for the distribution of their estate. It is something we all like to put off to another day… the only problem is that it gets forgotten and then we leave others to sort out the mess when the inevitable happens… unless, of course, like me and most other men I know, you are immortal!