Q: Which inheritance laws apply on foreign residents in the UAE? What is your advice in terms of property ownership and bank accounts?
A: Inheritance and property laws are a complex issue and it is worth investing in independent legal advice to be entirely confident about your position.
The rules regarding the form and technical provisions of wills can be confusing for lay people. It's also worth being aware that property laws are changing, which will in turn affect the rules regarding inheritance.
A good local lawyer can help you understand all this. However, there are some basic steps you should take to increase the confidence and security of your family.
Probably the best advice - wherever you reside - is to make sure that you have made a will for all your property and that this will is constituted properly, so that it is recognised under the law of your country of origin and your country of residence.
Almost every lawyer and financial adviser urges their clients to make a will, because the alternative creates so much stress and heartache for bereaved family members.
When people pass away intestate - without a will - it creates a number of issues, particularly if there are multiple claims on a property. It also adds to the uncertainty and upset that surrounds the passing of a loved one.
Legal framework
The UAE has a legal framework in place surrounding the drafting of a will, so there's really no excuse for anyone not to have one.
For Muslim expatriates, typically the courts will apply Sharia law in regard to inheritance and the drafting of a will.
However, even non-Muslims who have a valid resident visa can make a will and have it registered in the UAE.
In the interests of family security, you should itemise all your valuable assets within the document, starting with any properties you might own, but also including bank accounts and disposable assets.
Typically, the will must be typewritten or computer generated, must expressly state that it's your will, and it should be signed and dated.
It will also need to be signed by witnesses - the number may vary depending on the laws of your home country.
It's important that the will is legally approved and attested by authorities in your home country, before it is recognised as legal here in the UAE.
You should also have the document translated into Arabic; particularly if you own property and want to make sure it is passed on in accordance to your wishes.
You should also bear in mind that your will can be structured in such a way as to mitigate the tax burden on your inheritance.
Residents from the UK, in particular, need to consider the potentially steep inheritance taxes that can be levied on international assets. Typically, everything above the so-called "nil band rate" is subject to taxation. However, there are a number of exemptions which allow people to pass on inheritance without incurring tax.
All these issues underline the importance of consulting an expert when you are drafting your will. Ensuring this is in place provides a significant degree of protection to your loved ones.
- The writer is an expert consultant at Nexus, a leading financial advisor in the Middle East. The opinions expressed above are the writer's and don't necessarily represent views of Gulf News. Readers are encouraged to thoroughly investigate all investment decisions. Please send your questions to advice@gulfnews.com
