Many times, Jews living in the diaspora also hold assets in Israel. After the passing of such owners, cross-border questions of inheritance law arise. Our law offices are specialized in those kind of questions, we perform complex estate planning and inheritances with international dimension.
Israeli Certificate of Inheritance
In order for the estate located in Israel, e.g. an apartment or bank accounts, to be transferred to the heirs, an Israeli certificate of inheritance is usually required. Israeli banks and the land registry do not accept a foreign certificate of inheritance. The certificates of inheritance is issued by the competent Israeli family court upon request of an heir. This proceeding can last up to several months. However, it is not Israeli law which is applied to such proceedings, but the law of the country where the decedent last resided. This, from the Israeli point of view, foreign law has to be proven to the judge by providing a legal expert opinion.
Our inheritance law specialists have a profound knowledge of the inheritance laws of all German-speaking countries and they are familiar with complex constellations such as mutual wills, appointment of substitutional heirs or inheritance agreements. With their practical experience of many years our experts guide the Israeli judge through the jungle of European inheritance law concepts such as statutory share, testamentary contracts or legacy, of which there are no equivalents in Israeli law.
The necessary legal writings for the proceeding are translated and notarized directly in our law offices. We can thus offer the complete handling of the certificate of inheritance from a single source and thus in the best interest of the heirs.
Distribution of the Estate
After obtaining the certificate of inheritance, the estate has to be distributed among the heirs. Our specialists will stand by your side with this process, too. If necessary, heirs will sign an inheritance distribution contract prior to the distribution, e.g. if the heirs intend to distribute real estate differently from the testamentary or intestate regulations. In this case, an inheritance distribution contract is crucial as the registration of real estate in the land registry in the course of an inheritance distribution is tax-free, whereas if real estate was transferred from one heir to another subsequent to its initial distribution, the Israeli real estate taxes would become due.
In certain cases, especially with larger or more complex estates, or if the heirs do not agree on the distribution of the estate, it is recommendable to assign an estate administrator in Israel. The administrator represents the heirs until the distribution of the estate and takes care that the estate is adequately maintained or even augmented. The administrator is authorized, e.g. to invest assets, maintain and rent out apartments, hand in tax reports and pay taxes. Eventually, he executes the distribution of the estate to the heirs.
When the inheritance is distributed, we manage the change of ownership and transfer of title in the land registry for the heirs, we are in touch with the banks regarding the unblocking of bank accounts and take care of providing the necessary documents. If assets, especially real estate are to be sold, we can help you find a matching buyer and our real estate department can carry out the sale for you.
Other than in Germany and most Swiss Cantons, there is no inheritance, nor beneficence tax in Israel. However, the German and Swiss (cantonal) inheritance taxes apply to the entire estate, thus on the assets inherited in Israel, too. Accordingly, if the testator’s last (or the heir’s at the time of the decease) residence was in Germany or Switzerland, the inheritance tax encompasses the inherited Israeli assets, too.
Our law office will collaborate with your accountant in carrying out those German or Swiss inheritance taxes. We can provide the necessary documents for a voluntary disclosure or even manage it ourselves with our own linked accountants in Switzerland and Germany.
Many of the problems mentioned above can be prevented by a prudent estate planning during the testator’s lifetime. Our law office has broad experience in skillfully using planning instruments for a clever and economical estate planning.
We advise you globally and take into consideration your entire life- and international asset situation, as well as possible wills, inheritance or pre- and post-nuptial agreements and the interaction of the provisions of the various legal systems involved.