What is a Will?
A will is a person’s written declaration of his/her intention regarding the way he/she wishes to dispose his/her movable and immovable property following he/she passes away. However, a person’s right to dispose his/her assets through a Will is not absolute and is subject to certain restrictions under Cyprus Law.
Which laws govern and regulate Wills and Succession in Cyprus?
Wills and Succession law in Cyprus is governed by both domestic and EU law. In relation to Cyprus law, the most significant enactments are:
- The Wills and Succession Law, Cap. 195,
- The Administration of Estates Law, Cap. 189,
- The Probates (Re-Sealing) Law, Cap. 192.
Moreover, EU law is relevant and specifically Regulation (EU) 650/2012 which allows EU citizens to choose the law of the country of their nationality as the governing law of their will.
What are the requirements for a Will to be valid?
- A Will must be in writing,
- The Testator must sign the Will at the bottom of the last page and put his/her initials on each and every page of the Will.
- The testator must sign in the presence of at least two witnesses who will also sign the Will in the presence of each other and the testator.
Can a Will be revoked?
A Will can be revoked by another Will that will explicitly state that it revokes the previous one. It can also be destroyed by a testator or a person authorised by the testator. A Will is considered to be revoked if the testator gets married or has a first-born child at a time following the execution of the Will.
Are there any restrictions regarding the terms of a Will?
There are certain restrictions regarding the way assets can be disposed through a Will. More specifically, Cyprus has what we refer to as a “forced heirship regime”, meaning that certain relatives / heirs, such as a spouse or children, cannot be excluded from an inheritance and they have a right to a fixed minimum percentage of the estate.
What is a Forced Heirship Regime?
According to Cypriot law this kind of regime aims essentially to protect the rights of close relatives of the testator. The part of the property that the testator can dispose of with a Will is referred to as “disposable portion”. The remaining property is referred to as “statutory portion”. The calculation of both the disposable and statutory portion depends on who the surviving relatives at the time of death are.
How is the disposable portion calculated?
- Where a person passes away, leaving spouse and a child, or spouse and descendant of a child, or no spouse but a child or descendant of a child, the disposable portion must not exceed one-fourth of the net value of the estate.
- When a person passes away, leaving spouse or father or mother but no child or descendant of a child, the disposable portion shall not exceed one-half of the net value of the estate,
- When a person passes away, leaving neither a spouse, nor a child, nor a descendant of a child, nor a father, nor a mother, he/she is free to dispose as he/she wishes all of the estate.
What happens if a Will disposes more than the disposable portion?
The Will will not be void if such a scenario, but the disposition will be reduced and limited to the disposable portion as per the above.
What happens with the rest of the portion, the so-called statutory portion?
The remaining portion (Statutory Portion) will be disposed as per the statutory portion which means that the distribution will be made according to the rules of intestacy.
The portion of the spouse is calculated first and then the rest of the estate will be distributed to the relatives of the deceased depending on the degree of kindred. The share of the surviving spouse is as follows:
- Where the deceased left a child or a descendant of a child, the spouse’s share is equal to the share of each child.
- Where the deceased left no child or descendant of a child but has an ancestor or descendant of an ancestor within the third degree of kindred, the spouse is allowed 50% of the net estate.
- Where the deceased has left a relative within the fourth degree of kindred, the spouse is entitled to 75% of the net estate.
- Where the deceased left no relative within the four degrees of kindred the spouse is entitled to the entire net estate.
Is it compulsory to make a will?
It is not obligatory to have a will. If someone passes away without having left a will, his/her assets will be distributed in accordance to the rules of intestacy and succession.
How is an estate distributed according to the rules of intestacy?
There are four classes of kindred who are entitled to inherit an intestate person:
- First class: Legitimate children of the deceased and descendants of any of the deceased’s children who died during his/her lifetime.
- Second class: Any parent or sibling of the deceased.
- Third class: The closest in degree of kindred living ancestors of the deceased. Such as a grandparent.
- Fourth class: The nearest relatives of the deceased alive at the time of his/her death up to the sixth degree of kindred (i.e. cousin and siblings of grandparents).
What happens with immovable and movable property owned by foreign nationals?
Under Article 22 (Choice of law) of the EU Succession Regulation (650/2010), foreign nationals can choose whether the law of their country of nationality or of any other country will apply to the succession of their estate in total.
For example, Italian nationals with property in Cyprus can opt for Italian law for the administration of their estate in the event of their death and avoid the forced heirship regime altogether. The decision to apply Italian law should be mentioned clearly in the will, as failing to do so will make the Cypriot law of succession applicable by default. However, there are certain exemptions regarding whether a deceased has left movable or immovable property in Cyprus.
Are there any tax obligations?
There is no inheritance tax in Cyprus as the Estate Duty (Amending) Law 2000 has been abolished concerning any person who passed away after the 1st of January of 2000. It must be noted though that domiciles of other countries may be liable to pay inheritance tax in their countries.
According to the European Regulation (EU) 650/2012, the Domicile of a deceased person ceases to be the connecting link (Ch. 195) and cross border succession will be governed by a specific criterion, that is “the habitual residence” of the deceased. This EU Regulation is applicable for deaths that occurred after 17 August 2015 and if this is the case then a Member State (except Denmark and Ireland) will assume international jurisdiction to adjudicate the case of inheritance in its totality, provided that the criterion of habitual residence in that specific country is satisfied.
In principle, the law that will apply to the succession is the law of the country in which the deceased had his/her habitual residence at the time of death. The country of habitual residence is the country with which the deceased has a close and stable connection/link. This country will be decided in each particular case by the authority dealing with the succession.
It is advisable that when someone is planning his/her succession, he/she can choose that, instead of the law of the country of his/her last habitual residence, the law of your country of nationality (at the time of the choice or at the time of death) should apply to his/her succession. This can be the law of an EU Member State or the law of a non-EU country (in the case of a non-EU country, he/she should ensure that the country whose law he/she have chosen will accept his/her choice of law).
It is important to stress that according to the EU Regulation only one law will apply to a succession. This law will govern the succession of all the deceased’s estate and assets, regardless of whether the assets are moveable (like a car or a bank account) or immoveable (like a house) and regardless of where the deceased’s assets are located (that is, even if those assets are located in several countries).
The EU Regulation introduces the European Certificate of Succession (hereinafter “ECS”) which is a single document that allows heirs, legatees, executors of the will and administrators of the estate to prove their status and exercise their rights or powers in other Member States of the European Union. Once a ECS is issued it will be recognised automatically without any further procedures being required. Articles 62-73 of the EU Regulation provide for the option to execute a European Certificate of Succession, in a member state different from the one that was issued.
The European Certificate of Succession is being issued after application by the heir, legatee, executor of the will or the administrator of the estate, based on the Form V of Appendix 4 of the EU Regulation 1329/2014. When issued, the European Certificate of Succession will be recognized in all the other Member States, without any special procedure being required and the information included in it will be presumed as accurate. Also a European Certificate of Succession is valid for a period of 6 (six) months, and a relevant extension may be required upon proof of valid reason.
It is important to emphasize that the European Certificate of Succession can be issued only by the authority of the EU Member State which will be responsible to handle the deceased’s succession (for example the authorities of the EU Member State where it was the last habitual residence of the deceased).
The European Certificate of Succession contains multiple information, for example the information of the deceased and the applicant of the inheritance, the information of all the possible heirs, the legislation which applies to the hereditary succession and how it was determined which legislation was applied, which part of the inherited property belongs to each of the heirs, the powers of the executor and/or administrator of the estate etc.
FAQ – European Certificate of Succession
What is an ECS?
An ECS is a document that enables heirs, legatees, executors of the will (the persons who implement the wishes of the testator) and administrators of the estate (the persons that take care of the estate before it is transferred to the heirs) to prove their status and exercise their rights in other EU Member States.
Who can apply for an ECS and when?
An ECS is not automatically issued; it must be requested after a person’s death (regardless of whether or not the deceased left a will). Any heir, legatee, executor of the will or administrator of the estate who needs to prove their status or exercise their rights in another EU Member State can apply for an ECS.
Who is authorised to issue the ECS?
An ECS can only be issued by the authorities of the EU Member State that is competent to deal with the succession. These may be the authorities of the EU Member State where the deceased had his/her last habitual residence or the authorities of the EU Member State of the deceased’s nationality if heirs have agreed to choose the courts of that EU Member State (see Can the heirs choose the EU Member State where the succession should be handled?). Each EU Member State decides which specific authority within its territory will issue an ECS. An ECS will often be issued by a court or a notary.
What are the contents of an ECS?
The authority that issues the ECS will fill in all the data required in the certificate in accordance with the law applicable to the succession, that is, either the law of the deceased’s country of habitual residence or the law of the deceased’s nationality if he/she chose that law. The certificate includes information such as: details of the deceased and of the person who applied for the ECS; details of all possible heirs; the property regime of the deceased’s marriage or registered partnership (i.e. the rules that govern how property should be divided between spouses or registered partners so that the share of the deceased can be transferred to his/her heirs); the law applicable to the succession and how that law has been determined; whether or not the deceased left a will; the share of the estate that corresponds to each heir; the powers of the executor of the will and/or the administrator of the estate.
What are the advantages of an ECS?
An ECS does not replace equivalent documents existing in each EU Member State (the national certificates of succession). It is an optional alternative. However, applying for an ECS instead of the equivalent national document simplifies things if you need to prove that you are an heir (or a legatee, executor of the will or administrator of the estate) in several EU Member States because the deceased had assets in more than one EU Member State. This is so because, in accordance with the regulation, an ECS has the same effects in all EU Member States regardless of where it is issued and its recognition requires no special procedure. In contrast, the effects of a national certificate of succession are different depending on the EU Member State which issues it, and these effects may therefore need to be explained in an additional form filled in by the issuing authority.
Source (Publications Office of the European Union)
- What is a Will?
A will is a person’s written declaration of his/her intention regarding the way he/she wishes to dispose his/her movable and immovable property following he/she passes away. However, a person’s right to dispose his/her assets through a Will is not absolute and is subject to certain restrictions under Cyprus Law.
- Which laws govern and regulate Wills and Succession in Cyprus?
Wills and Succession law in Cyprus is governed by both domestic and EU law. In relation to Cyprus law, the most significant enactments are:
a) The Wills and Succession Law, Cap. 195,
b) The Administration of Estates Law, Cap. 189,
c) The Probates (Re-Sealing) Law, Cap. 192,
Moreover, EU law is relevant and specifically Regulation (EU) 650/2012 which allows EU citizens to choose the law of the country of their nationality as the governing law of their will.
- What are the requirements for a Will to be valid?
a) A Will must be made in writing,
b) The testator must sign the Will at the bottom of the last page and put his/her initials on each and every page of the Will.
c) The testator must sign in the presence of at least two witnesses who will also sign the Will in the presence of each other and the testator.
- Can a Will be revoked?
A Will can be revoked by another Will that will explicitly state that it revokes the previous one. It can also be destroyed by a testator or a person authorised by the testator. A Will is considered to be revoked if the testator gets married or has a first-born child at a time following the execution of the Will.
- Are there any restrictions regarding the terms of a Will?
There are certain restrictions regarding the way assets can be disposed through a Will. More specifically, Cyprus has what we refer to as a “forced heirship regime”, meaning that certain relatives / heirs, such as a spouse or children, cannot be excluded from an inheritance and they have a right to a fixed minimum percentage of the estate.
- What is a Forced Heirship Regime?
According to Cypriot law this kind of regime aims essentially to protect the rights of close relatives of the testator. The part of the property that the testator can dispose of with a Will is referred to as “disposable portion”. The remaining property is referred to as “statutory portion”. The calculation of both the disposable and statutory portion depends on who the surviving relatives at the time of death are.
- How is the disposable portion calculated?
a) Where a person passes away, leaving spouse and a child, or spouse and descendant of a child, or no spouse but a child or descendant of a child, the disposable portion must not exceed one-fourth of the net value of the estate.
b) When a person passes away, leaving spouse or father or mother but no child or descendant of a child, the disposable portion shall not exceed one-half of the net value of the estate,
c) When a person passes away, leaving neither a spouse, nor a child, nor a descendant of a child, nor a father, nor a mother, he/she is free to dispose as he/she wishes all of the estate.
- What happens if a Will disposes more than the disposable portion?
The Will will not be void if such a scenario, but the disposition will be reduced and limited to the disposable portion as per the above.
- What happens with the rest of the portion, the so-called statutory portion?
The remaining portion (Statutory Portion) will be disposed as per the statutory portion which means that the distribution will be made according to the rules of intestacy.
The portion of the spouse is calculated first and then the rest of the estate will be distributed to the relatives of the deceased depending on the degree of kindred. The share of the surviving spouse is as follows:
a) Where the deceased left a child or a descendant of a child, the spouse’s share is equal to the share of each child.
b) Where the deceased left no child or descendant of a child but has an ancestor or descendant of an ancestor within the third degree of kindred, the spouse is allowed 50% of the net estate.
c) Where the deceased has left a relative within the fourth degree of kindred, the spouse is entitled to 75% of the net estate.
d) Where the deceased left no relative within the four degrees of kindred the spouse is entitled to the entire net estate.
10. Is it compulsory to make a will?
It is not obligatory to have a will. If someone passes away without having left a will, his/her assets will be distributed in accordance to the rules of intestacy and succession.
11. How is an estate distributed according to the rules of intestacy?
There are four classes of kindred who are entitled to inherit an intestate person:
a) First class: Legitimate children of the deceased and descendants of any of the deceased’s children who died during his/her lifetime;
b) Second class: Any parent or sibling of the deceased;
c) Third class: The closest in degree of kindred living ancestors of the deceased. Such as a grandparent;
d) Fourth class: The nearest relatives of the deceased alive at the time of his/her death up to the sixth degree of kindred (i.e. cousin and siblings of grandparents).
12. What happens with immovable and movable property owned by foreign nationals?
Under Article 22 (Choice of law) of the EU Succession Regulation (650/2010), foreign nationals can choose whether the law of their country of nationality applies to the succession of their estate. This applies to all EU states.
For example, Italian nationals with property in Cyprus can opt for Italian law for the administration of their estate in the event of their death and avoid the forced heirship regime altogether. The decision to apply Italian law should be mentioned clearly in the will, as failing to do so will make the Cypriot law of succession applicable by default. However, there are certain exemptions regarding whether a deceased has left movable or immovable property in Cyprus.
For immovable property, the succession is governed by the law of the country where the specific immovable property is situated and Cypriot law will apply regardless of the testator’s domicile country at the time of death (lex situs).
For movable property, if the deceased has mentioned clearly in his/her Will the decision to opt for the law of their domicile country, the law of that country will prevail over the distribution of movable property. If not, the Wills and Succession Law will apply.
13. Are there any tax obligations?
There is no inheritance tax in Cyprus as the Estate Duty (Amending) Law 2000 has been abolished concerning any person who passed away after the 1st of January of 2000. It must be noted though that domiciles of other countries may be liable to pay inheritance tax in their countries.
