Wills And The Global Investor: Does One Worldwide Will Suffice?
It is becoming more common for people to “not keep all their eggs in one basket” and diversify their investments into jurisdictions outside of South Africa. Whilst this is deemed to be financial savvy, it does raise the question about what will happen when you pass away while owning assets offshore? Are the foreign assets covered by a local South African will? Do you need a Will for each place? Or will one “worldwide Will” do?
The quick answer is that there is no one-size-fits-all solution and it depends on the country in which the offshore assets are held, says Sarah Love, a fiduciary practitioner at Private Client Trust, a division of Private Client Holdings.
According to Love, the starting point in any multi-jurisdictional estate planning is to first take stock and establish what you are dealing with – gaining a clear understanding of which countries hold which assets and in what form. Also, important to note is that assets held within wrappers and life policies are not governed by the Will but rather the beneficiary nomination.
“One needs to investigate each jurisdiction where assets and/or investments are held to see how in that country when it comes to Wills and inheriting. For example, some countries have forced heirship (such as Spain and Italy) and special requirements for the execution of their Wills.”
“In instances where a country’s laws differ from our own here in SA, or where immovable property is owned, having a separate Will dealing specifically with the assets held in that country may be the best approach. This is particularly important if you want to avoid lengthy estate administration delays,” says Love. “Once it is known how each country approaches heirship and Wills, one can draw up an appropriate Will, or multiple Wills as required.”
However, Love cautions that separate offshore Wills and the South African Will must be aligned, otherwise the process can still become incredibly complex and frustrating.
“Absolute care should be taken when drafting multiple Wills so that they do not contradict or revoke each other,” says Love. “In other words, the Wills should not refer to the same assets otherwise they may unintentionally create ambiguity, and attention should be paid to the revocation clause to ensure that you don’t accidentally cancel another jurisdiction’s Will. Also, be careful of leaving out any jurisdictions – for example, the Isle of Man is not in the United Kingdom, so your UK Will would not cover assets held there.”
Love advises that if you have assets in multiple jurisdictions, it is crucial to get advice from a Fiduciary Practitioner who can give you the counsel you need and pull in the relevant expertise from each country to ensure that there will be no problems with your estate after you pass.
“The value of seeking a professional Fiduciary Practitioner cannot be overlooked, as each of the Wills must be properly worded so as not to create any grey areas. It is essential that multiple Wills are thoroughly reviewed to ensure they are not contradictory and align with the rules and regulations of each jurisdiction.”
“There is no one-size-fits-all solution and so getting professional advice to guide you through your specific circumstances is crucial,” concludes Love.