What Is The Role of an Executor in Italy?

Only a testator may appoint an executor in a Will 

What Is The Role of an Executor in Italy? If you appoint an executor in your Will, your executor ensures that your last wishes and the administration of your estate are taken care of after your death.

In order to do this, unless you have stipulated otherwise in your Will, your appointed executor undertakes to manage your estate with all reasonable care.

In Italy this  includes managing all probate and succession procedures in accordance with Italian legislation. The executor takes possession of all the assets included in your estate and manages the distribution of assets and bequests to heirs in accordance with your Will. Where an executor has been appointed, your heirs may neither manage nor dispose of your assets autonomously.

Appointing an executor is highly recommended in complex personal or patrimonial frameworks: if your estate involves cross-border assets, where an heir is legally deemed incapacitated, if an heir is under the age of 18, if your estate is to be transferred to heirs who live outside of Italy and or heirs are not Italian nationals or heirs who the testator feels may have vested or conflicts of interest.

According to Italian law, the powers of an executor include:

  • managing the deceased’s estate, taking possession of the assets included in it and returning to heirs those assets which do not need administration (personal belongings for example);
  • distributing estate assets among heirs (forced and nominated heirs as applicable);
  • actively and passively representing the inheritance in court should issues arise during administration;
  • obtaining relevant legal consents where heirs are minors, absent, legally incapacitated or legal entities.

Once the Italian succession procedure has been completed, the executor must render accounts and is personally liable to pay damages to heirs or legatees in case of malpractice.

Is it possible to take a “DIY” approach to Italian estate administration?

Of course an executor can manage the whole Italian succession procedure themselves. That said, the death of a relative or friend is a very stressful and emotional time and if there is any complexity such as real estate property in Italy, an executor may find it extremely helpful to have a competent and experienced professional on board to manage Italian succession procedures. Engaging a specialist Italian inheritance lawyer will facilitate the whole process, save money and headaches with paperwork and red tape and avoid procedural issues (mistakes, wrong documents, omissions etc.).

Finally …

If you are making or reviewing your Will, appointing an experienced estate lawyer in Italy as your executor protects heirs from costs deriving from procedural mistakes and inheritance tax calculations. Likewise if you have been appointed an executor for an Italian estate: a lawyer will be able to help with the administration of a Will. If a costly error does arise, your lawyer is jointly liable. Contact us if you would like to discuss your case.

Cross-Border Inheritance – A Case Study

What is the legal situation if you own assets in Italy and abroad?

Cross-Border Inheritance – A Case StudyTom Smith was a UK national in his 60s. He had two children from his first marriage, both children are now adults. On a trip to Italy 20 years ago, Tom met a young Italian woman, Giovanna. A few years later, they got married in Giovanna’s home town – Perugia, in Umbria.

Tom and Giovanna set up home in the countryside, about 30kms from Perugia. They lived in a house on two hectares of land set to orchards and olive groves. Tom was passionate about looking after his land.

Tom and Giovanna have a daughter. Francesca, now aged 15, was born in Italy and holds dual British and Italian nationality.

Before he met and married Giovanna, Tom had purchased a property in Bath in southwest England. The title is in Tom’s name and the property is currently valued at about £1 million. During their marriage, Tom and Giovanna purchased a property in Cornwall, now worth about £300 thousand, which they own as tenants in common.

The property in the Umbrian countryside was purchased for €250 thousand in 2007, under the Italian marital “Community of Property” regime, and prices have remained stable since then.

In his name only, Tom also has a portfolio of investments in the UK. The portfolio is worth about £200 thousand. In addition, Tom has UK bank accounts with a balance of £10 thousand. He and Giovanna have a joint bank account in Italy with a balance of €12 thousand, mainly used for property maintenance, tax and living expenses in Italy.

When Francesca was born in 2002, Tom made a new English Will. He revoked his former Will at that time. He left legacies of £100 thousand to each of his two adult children, with the residue of the estate to be held in trust with an income to his wife Giovanna for life and, on her death, to Francesca. He appointed his English solicitor, David Johnson of Bath, as executor and trustee of the estate.

Tragically, one morning last year, while Tom was working in his olive grove, he suffered a  fatal heart attack. Giovanna was devastated. She is now finding it impossible to cope with the house and land in the Italian countryside. She wants to sell the property and purchase an apartment for herself and Francesca in Perugia. Giovanna’s parents live in the city and there is a better selection of schools for Francesca when she starts high school next year.

Understandably, Giovanna cannot face dealing with the English legal system’s grants of probate, trusts and so on. David Johnson is administering the entire estate as executor and trustee.

David is not very familiar with Italian law and the Italian inheritance and probate procedure and has contacted us with a number questions regarding the Italian property involved in the succession.

Cross-border inheritance Q&A

  1. Is Tom Smith’s English Will recognised under Italian law? If so, do the Italian authorities require a UK grant of probate before commencing the administration of the Italian estate?
    Assuming Tom Smith’s Will is recognised as valid by the competent authorities in the UK, it is also recognised under Italian law. A UK grant of probate evidences the recognition of the Will by the UK authorities and is necessary to start succession procedures in Italy.
  2. Is it possible Tom Smith also left an Italian Will? What searches could be made to ascertain this?
    There are various types of Will in Italy. If Tom Smith had a Formal or Holographic Will, which was deposited with a Public Notary, then a search can be conducted through:
    a) Lodging a request with the competent notarial archives;
    b) Lodging a request with the General Wills Registry in Rome.
  3. What steps, if any, should be taken immediately in Italy? Who is empowered to take such steps?

Any individual having an interest in the succession should start the relevant succession procedures in Italy, ideally with the support of a professional. The priority is lodging the statement of succession with the Italian Inland Revenue (Agenzia delle Entrate).

  1. Can I liaise directly with the bank in Italy, requiring funds to be transferred directly to Tom’s client account so that Giovanna and Francesca have funds to live on?
    Yes. However, no funds will be released by the Bank prior to completion of succession procedures in Italy.
  2. As the executor of Tom Smith’s Will, can I sell the Italian property directly to a third party? Which law governs the administration of the Italian property?
    An executor should dispose of the inheritance assets in compliance with the Will. In principle, the administration of an Italian property is regulated under Italian law.
  3. Under Italian conflicts rules, which law governs the succession of the Italian property?
    Italy is a signatory to the EU Succession Regulation. Art. 22 of the EU Succession Regulation provides that a testator may choose, or determine, the law of their nationality as the law to govern the succession as a whole, professio juris (choice of law).
    Alternatively, with regard to real estate property, succession will be regulated under Italian law. As far as movable assets are concerned, succession will be regulated by the law of domicile.
  4. Are there any forced heirship rules in Italy? Will they be applicable in this particular case?

Forced heirship exists in Italy. It is applicable in this case both to Tom Smith’s direct descendent – his daughter, Francesca and to Giovanna his surviving spouse.

  1. If the Italian property cannot be sold, could the trustee and/or Francesca be one of the registered owners of the property?

They can, provided they are named as heirs in the Will.

  1. Would it have been easier for Tom Smith to make a Will under Italian law to dispose of his assets?
    Certainly the whole succession procedure would have been easier and more practical if Tom Smith had written a Will in Italian. As a matter fact, there are difficulties in managing a foreign Will in Italy. A Will written in a foreign language requires a certified translation by a sworn translator. This can lead to issues regarding interpretation of the testator’s wishes by the competent Italian authorities once the Will is published. This in turn may lead to a costly and protracted succession procedure.
  2. Is there any inheritance tax in Italy and, if so, who is liable for the payments?
    Italian inheritance tax should be paid by the heirs when lodging the statement of succession.

Finally …

If you have any questions concerning your own cross-border property and succession case or circumstances, please consult our comprehensive Italian Inheritance Guide or if you would like to discuss your personal situation, please get in touch.

At De Tullio Law Firm, we have over 55 years of experience managing cross-border inheritance cases on behalf of Italian and international clients. We have in-depth expertise of Italian and international legal systems and processes. We understand the way things work in Italy, which is often different to the way things work elsewhere. 

Why is it important to make a Will if you own property in Italy?

Making a Will ensures that when you die your estate is shared according to your wishes.

Why is it important to make a Will if you own property in Italy?Do you own property at home and in Italy? Do you have shares, savings, investments? All of these assets constitute your ‘estate’. So, drafting your Will should be a priority.

Everyone should have a Will, but having a Will is even more important if you have children, you own property or have savings, investments, insurance policies or you own a business.

Isn’t making an Italian Will expensive? 

No. The cost of making a Will in Italian is not excessive and it is well worth the cost to keep your affairs in order. 

Having an Italian Will facilitates the way forward for those you leave behind; it can prevent potentially costly disputes and misinterpretations and it creates tax and administration efficiencies.

Can you make a DIY Will in Italy?

It is possible to make a DIY Will. However, if your circumstances are even slightly complex, you could be causing more problems than you solve. If you own assets in Italy and elsewhere, this cross-border situation makes your situation complex. If you make your own Will, without legal assistance, it can lead to mistakes or a lack of clarity; it may even render a Will invalid.

Seeking legal assistance with a Will is advisable 

If you have a number of beneficiaries, if you own assets in Italy and elsewhere, if you have residential or business connections in Italy, we would always counsel taking legal advice from a specialist Italian inheritance lawyer. Likewise, you should seek advice if you live with someone, if you are married or in a civil partnership or if you have children from a previous relationship or step-children. They may not automatically inherit your estate.

Wills, estate-planning and inheritance are serious issues. They touch many lives in many ways. If you die intestate – without a Will, you have no say in what happens to your estate. Instead, the division of your estate will be determined by the law of the country (or countries) where your assets are situated.

In Italy, succession law is based on the principle of ‘Unity of Inheritance’. This principle differs substantially from common law. Essentially, you may find that Italian assets you own are not inherited by those who you wished to benefit and, the whole estate may not be passed on in the most tax-efficient way.

You should review your Will periodically and whenever your circumstances change

Once you have written your Will, you should review it regularly to make sure it reflects your wishes, especially if your life changes. For example, if you:

  • get married / enter a civil partnership – an existing Will is automatically cancelled by these events
  • get divorced
  • have a child or other relatives you wish to benefit, for example nieces, nephews or grandchildren
  • have bought a new property or have recently obtained expensive assets

Finally …

At De Tullio Law Firm, we are cross-border property and inheritance law specialists. We are a full member of STEP, the world’s leading professional body for trusts and estate planning practitioners. We are present throughout Italy. 

For more information about Italian inheritance and succession law, please consult our useful Italian Inheritance Guide or, why not  get in touch with us for a free consultation? We are here to help.

 

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