Succession Planning for International Families: Trusts, Foundations & Wills

Succession planning for international families is exponentially more complex than for domestic families. When the family patriarch holds UK and Grenadian citizenship, lives in Dubai, owns property in London, has a company in Singapore, holds investments through a BVI company, and has children studying in the US — which country's inheritance law applies? The answer is: potentially all of them.

The Multi-Jurisdictional Problem

Which Law Governs Succession

Different countries apply different rules to determine which law governs the distribution of a deceased person's estate:

Common law jurisdictions (UK, US, Singapore, Hong Kong, Australia):

• Immovable property (real estate): Governed by the law of the country where the property is located (lex situs)
• Movable property (bank accounts, shares, personal property): Governed by the law of the deceased's domicile at death

Civil law jurisdictions (France, Germany, Italy, Spain, most of Latin America):

• The EU Succession Regulation (Brussels IV) allows EU-domiciled individuals to choose the law of their nationality to govern succession
• Without a choice, the law of the deceased's habitual residence applies

Sharia jurisdictions (UAE, Saudi Arabia, Qatar):

• Islamic succession law (Sharia) may apply to Muslim individuals
• Non-Muslims in the UAE can now elect the law of their nationality under DIFC Wills and Probate Registry or Abu Dhabi Judicial Department

Forced Heirship

Many civil law jurisdictions impose forced heirship — mandatory minimum shares that must go to specific heirs (typically children and surviving spouse), regardless of the deceased's wishes:

Jurisdiction	Forced Heirs	Reserved Share
France	Children	50-75% (depending on number of children)
Germany	Children, spouse	50% of intestate share
Italy	Children, spouse	33-75%
Spain	Children	66% (varies by region)
UAE (Sharia)	Children, spouse, parents	Detailed fixed fractions
Japan	Children, spouse	50%
Switzerland	Children, spouse, parents	37.5-75%
Brazil	Children, spouse	50%

Common law jurisdictions (UK, US, Singapore, Hong Kong) generally allow complete testamentary freedom — the testator can distribute assets however they choose (subject to family provision claims in the UK).

Probate in Multiple Jurisdictions

Without proper planning, an international estate may require probate in every jurisdiction where assets are located:

• UK Grant of Probate for London property
• Singapore Grant of Probate for Singapore company shares
• Dubai probate for UAE assets
• BVI probate for BVI company shares

Multiple probate proceedings are expensive (legal fees in each jurisdiction), slow (6-24 months per jurisdiction), and public (probate records are typically accessible).

Planning Tools

International Will

The Hague Convention on the Form of International Wills (1973) provides a standardised will format recognised across member states. However, not all countries are signatories, and an international will may not satisfy local requirements in every jurisdiction.

Best practice: Execute separate wills for each jurisdiction where significant assets are located:

• A UK will covering UK assets
• A Singapore will covering Singapore assets
• A UAE will covering UAE assets
• A "worldwide" will covering all remaining assets

Each will should contain a clause expressly stating it does not revoke wills made in other jurisdictions for assets in those jurisdictions.

Trusts

Trusts are the most powerful succession planning tool for international families because they:

• Transfer assets outside the deceased's estate before death
• Avoid probate entirely (trust assets are not part of the estate)
• Can override forced heirship rules (if the trust jurisdiction does not recognise forced heirship)
• Provide for management continuity during incapacity
• Allow staged distributions to beneficiaries (e.g., at age 25, 30, 35)
• Protect assets from beneficiaries' creditors and divorcing spouses

Common trust jurisdictions for succession planning: Jersey, Guernsey, Cayman Islands, BVI, Cook Islands, Singapore

Foundations

For families in civil law jurisdictions where trusts are not recognised:

• Liechtenstein Stiftung: Legal personality, recognised in civil law systems, private bylaws
• Panama Private Interest Foundation: Flexible, low-cost, recognised in Latin America
• Dutch STAK (Stichting Administratiekantoor): Used for Dutch and European succession planning

Corporate Structures

Holding real estate and investments through companies simplifies succession:

• Instead of transferring property (which requires probate and local registration), the shares in the holding company transfer
• Shares can be held in trust, making the transfer seamless
• Avoids multiple probate proceedings
• Avoids stamp duty on property transfers in some jurisdictions

Example: London property held through a BVI company, shares of which are held by a Jersey trust. On the death of the settlor, the trust deed governs distribution of the BVI shares — no UK probate, no BVI probate, no property transfer registration.

DIFC/ADGM Wills (UAE)

Non-Muslim residents of the UAE can register wills with the DIFC Courts Wills and Probate Registry or the ADGM Courts. These wills are governed by the chosen foreign law (typically English law) and are enforced by the DIFC or ADGM courts, bypassing Sharia inheritance rules.

This is essential for non-Muslim families with UAE assets. Without a DIFC/ADGM will, UAE courts may apply Sharia succession rules by default.

Tax on Death

Inheritance and estate taxes add another layer:

Jurisdiction	Inheritance/Estate Tax
UK	40% on estates above GBP 325,000 (GBP 500,000 with residence nil-rate band)
US	40% on estates above USD 13.61M (2024, set to decrease)
France	5-45% (depending on relationship and amount)
Germany	7-50% (depending on relationship and amount)
Japan	10-55%
UAE	0%
Singapore	0% (abolished 2008)
Hong Kong	0% (abolished 2006)
BVI/Cayman	0%

For UK and US persons, the interaction between domicile, residency, and citizenship determines exposure:

• UK IHT: Based on domicile — UK-domiciled individuals are subject to IHT on worldwide assets, regardless of where they live
• US estate tax: Based on citizenship — US citizens are subject to estate tax on worldwide assets, regardless of where they live

Common Mistakes

No Plan at All

The most common mistake. Without a valid will in each relevant jurisdiction, intestacy laws apply — often distributing assets in ways the deceased would not have chosen.

Conflicting Wills

Multiple wills that inadvertently revoke each other. Each will must be carefully drafted to cover only specific assets and expressly preserve other wills.

Ignoring Forced Heirship

Assuming that a will governed by English law will override French forced heirship rules on French property. It may not — lex situs typically prevails for immovable property.

Failing to Update

Life changes (births, deaths, marriages, divorces, relocations) require estate plan updates. A trust established 20 years ago may no longer reflect the family's circumstances.

Key Takeaways

• International families face succession issues across multiple jurisdictions — each with different rules on governing law, forced heirship, probate, and taxation
• Trusts are the most effective tool for avoiding probate, overriding forced heirship, and providing structured distributions across generations
• Foundations (Liechtenstein, Panama) serve the same purpose in civil law jurisdictions where trusts are not recognised
• Holding assets through corporate structures simplifies succession — shares transfer more easily than direct property ownership
• Separate wills for each jurisdiction are essential, carefully drafted to avoid mutual revocation
• UAE residents must register a DIFC or ADGM will to ensure non-Sharia succession for non-Muslim families
• UK domiciliaries and US citizens face worldwide inheritance/estate tax regardless of residence — domicile and citizenship planning may be necessary
• Succession plans must be reviewed and updated after every significant life event or jurisdictional change