How does Italian succession law work?
Succession law in Italy is based on the Roman Law principle which protects close members of the family. This partially limits the right of a testator to dispose of assets.
Testamentary Succession is the assignment of the hereditary assets in compliance with the wishes of the testator as set out in an Italian will whereas in the absence of a will, inheritance follows the principles of legal succession. In other words, if the deceased was intestate, Italian succession law determines the distribution of the estate.
Forced Heirship in Italy
Where there is no will, Italian succession law gives rights to a number of legitimate heirs. These heirs have rights to the assets of the deceased. Such heirs are the spouse of the deceased and close relatives up to the 6th degree of connection.
Succession law in Italy reserves a significant quota of the inheritance to closest relatives. The deceased’s spouse, ascendants and descendants are all, “forced heirs”. This means that the testator cannot exclude them with their will.
When drafting an Italian will, the testator is free to dispose of a part of his assets known as a, “disposable quota”. Thus, a testator may only assign part of their assets to non-relatives.
Applicable succession law in Italy
Italian succession law is based on the unity of inheritance which highlights the difference between movable and immovable assets. The law of the last domicile or citizenship of the deceased party is applicable to non-property assets, while the law of the country where the property is located is applicable to property assets.
Therefore, properties in different countries will be subject to the law of the country where each property is located. The succession procedure closes once estate tax has been paid and all assets, rights and pending payments have been transferred to the heirs. Partition of an estate is either through mutual agreement or as consequence of judicial proceedings.
It is also worth mentioning that non-Italian nationals may be subject to the testamentary succession laws of their own country. If the deceased was resident in Italy at the time of death, Italian Inheritance law applies to the deceased’s worldwide assets. Whereas if the deceased lived outside Italy, Italian inheritance law is only applicable to assets in Italy.
For foreign nationals resident in Italy, the introduction of EU Succession Regulations, known as Brussels IV, may also impact how you manage your cross-border succession.
People put off estate planning because they think they do not own enough, they are not old enough, it will be costly or confusing, they will have plenty of time to do it later, they do not know where to begin or who can help them, or they just do not want to think about it.
Estate planning should be an ongoing process, not a one-time event. You should review and update your will as your family and circumstances change. This would include owning or purchasing a property in Italy. We recommend you seek independent legal advice regarding your personal situation.
At De Tullio Law Firm, we have over 55 years of expertise managing cross border succession matters throughout Italy. Our firm is also a full member of STEP, the world’s leading association for trust and estate practitioners.
Please contact us if you are buying or already own an Italian property or have any questions about your estate planning.