This guide explains who needs to create a will in Cyprus, the reasons for doing so and how this should be done. Will creation is one of the forms of estate planning and it is prudent for people to consider which form of estate planning is the most appropriate for them personally prior to creating a will.
Why do estate planning for your assets in Cyprus?
Planning one’s inheritance brings peace of mind for the future as it makes certain the distribution of assets to the people one intends to benefit. In addition, it avoids possible conflicts between family members and forced heirship rules. Estate planning predominantly happens through a will, a trust or an outward gift. As the circumstances of people differ, one should take advice on the proper structure to suit one’s needs.
Creating a will in Cyprus?
Creating a Cyprus will is the most common form of estate planning for expatriates and foreign investors. When a person passes away intestate, meaning without a will, the law has specific provisions on who is to benefit and this complicates matters. The property may for example pass to relatives with whom the deceased had no relationship or to the state. In addition, a long-term unmarried partner of the deceased may not get any assets.
Forced heirship rules
Cyprus does not have inheritance tax but it does apply forced heirship rules in the succession of people. While expatriates from the United Kingdom used to be excluded from the forced heirship provisions this was changed in 2015 and forced heirship is now applicable for UK expatriates preparing their wills in Cyprus. The forced heirship rules in Cyprus provide amongst other the following:
People with children or grandchildren can only leave ¼ of their assets to the people they wish as the ¾ must go to the wife and children in equal shares.,People who do not leave children but a spouse or parent can only leave 50% of their estate to the people they wish. The spouse’s share will depend on the living relatives of the deceased. For example, a cousin of the deceased may be legally entitled to a share.
It does not matter whether the deceased and the spouse lived separately if they did not officially divorce. Forced heirship rules can be avoided with proper planning.
Requirements of a valid will in Cyprus
The law provides that a will is valid if the following requirements are cumulatively present:
Signature at the bottom. The will is signed at the bottom or at the end by the testator or by another person acting for the testator in the presence of the testator and under his instructions. ,In the presence of two witnesses. The witnesses must attest and sign the will in the presence of the testator and in the presence of each other; and,
If more than one page: Each page to be signed or initialled by or on behalf of the testator and the witnesses.
The witnesses cannot be beneficiaries under the will. If the will provides that one of the witnesses is to inherit assets, then this provision shall be void (without effect).
Can a will in Cyprus be cancelled or changed?
Yes, it can. A will can be revoked in the following ways:
A new will: If it expressly cancels the previous will then the previous will shall have no effect. If there is no such express mention then the previous shall have no effect in the overlapping provisions.
Destruction of the will: Only the person creating the will can destroy it or give instructions for it to be destroyed in its presence. The person creating the will must have a clear intention to destroy the will.
Wedding or birth of 1st child after creation: Unless it can be gather from the will that the person who created it did so having in mind the prospect of the wedding or child-birth.
The Brussels Succession Regulation
The EU passed a regulation which affects the creation and execution of wills in the Member States. In particular it:
Allows a choice of law in the will in favour of the law of the country of nationality. In the absence of a choice of law, it applies the law of “habitual residence” of the deceased unless it is clear that the deceased was “manifestly more closely connected with another country”.
Therefore, an English national living in Cyprus may choose the law of England to govern his Cypriot will. Where a choice is not expressly made then it will depend on proving the place of habitual residence of the deceased or the one with the closest connection. Its always best to plan ahead of such uncertainties. While the Brussels Succession Regulation does not apply to the UK, Ireland and Denmark it applies for their citizens who have property in other EU countries who can choose the law of the country of their nationality or the law of the country of their habitual residence.
Note: This brochure contains general information for the subject it deals with. You should get legal advice before taking any related actions.