Nowadays, it is increasingly common for families to have members residing in countries other than their country of origin, which frequently gives rise to situations of cross-border successions, particularly within the Member States of the European Union.

Consider, for example, the case of a Portuguese national residing in Portugal who is called to a succession opened upon the death of another Portuguese national residing in a different Member State of the European Union. Faced with differing legal systems, it is only natural for questions to arise: which law is applicable? Where should the proceedings be initiated? What documents are required?

First and foremost, it is necessary to determine the law applicable to the succession. The general rule, established by Regulation (EU) No 650/2012, provides that the applicable law is that of the State in which the deceased had his or her last habitual residence.

However, the deceased may, by means of a will or a separate declaration, choose that the law of his or her nationality should apply, even if such nationality belongs to a State outside the European Union, provided that there is a relevant and genuine connection.

This aspect is of particular importance, as the applicable law may substantially affect rules regarding forced heirship, disposable share or the method of partition. Accordingly, heirs or interested parties may be required to initiate succession proceedings in more than one jurisdiction, with the attendant risk of contradictory decisions and increased costs.

In order to simplify such proceedings, the European Certificate of Succession was introduced in 2015.

In Portugal, it may be requested before the Civil Registry Office or a Notary Public. This certificate proves especially useful in that it constitutes an alternative to official documents issued by each Member State and benefits from automatic recognition in all Member States, without the need for further review or confirmation.

Thus, if you find yourself in the position of being heir to assets located in another Member State of the European Union and need to prove your status as successor, you may resort to the European Certificate of Succession. This document constitutes a simpler, more practical and secure solution to enforce your rights, enabling you to deal efficiently and expeditiously with the cross-border succession in question, while avoiding additional bureaucratic obstacles and ensuring the automatic recognition of your legal position in all participating Member States.

Beyond determining the applicable law and arranging the partition, it is also necessary to comply with the tax obligations arising from the inheritance.

In Portugal:

• The death must be declared to the Tax Authority, by means of the Stamp Duty Form 1, within 90 days from the date of death;
• The deceased, the heirs and the assets transferred must all be identified;
• Stamp duty amounts to 10% of the value of the transfer. However, there is an exemption for spouses, descendants and ascendants, in which case the tax due is 0%;
• Failure to comply with the statutory deadline entails the imposition of a fine.

Where the inheritance includes assets located in other Member States, it may also be necessary to comply with the tax obligations in those jurisdictions, even if certain heirs benefit from exemption in Portugal.

For example, where the succession involves assets located in Spain, heirs must be aware that both the procedural and tax requirements differ from those in Portugal. The inheritance must be formally accepted before a notary, by means of a public deed of acceptance and partition, which is a mandatory step in order for the assets to be registered in the heirs’ names.

As regards taxation, in Spain the Inheritance and Gift Tax (Impuesto sobre Sucesiones y Donaciones) applies, with rates varying according to the value of the assets, the autonomous community in which they are located and the degree of kinship between the heir and the deceased. Unlike Portugal, there is no general exemption for spouses, descendants and ascendants, although many autonomous communities provide for significant reductions or allowances in such cases. It should also be noted that the tax must be declared and paid within six months from the date of death (extendable by a further six months upon request), failing which interest and penalties will be imposed.

The Family and Succession Law Department of Belzuz Abogados, S.L.P., in Portugal, possesses extensive experience in advising private clients on these matters, and is therefore well placed to provide guidance and clarification regarding cross-border successions and the respective partition proceedings.