Intestacy Laws (the laws governing the distribution of your estate without a Will) can be frustrating and certainly not what you ideally want should you die. In Hong Kong, your spouse does not inherit all. If you have children, your spouse is entitled to the first HK$500,000 and the balance of your estate is split between your children and spouse. This is entirely impractical if you are trying to raise minor children (unless your estate is huge) as the cost of raising them can be expensive. If you don’t have children, your spouse is still not entitled to your full estate as they must now share with your parents or siblings. Generally, most families will look after their descendants but not siblings or ascendants.
If you die without a Will in Hong Kong, an administrator has to be appointed, which would be the same as the Executor, had you have written a Will. This could be your spouse or sibling and most people would not appoint a professional to deal with the whole distribution due to costs.
The dilemma in Hong Kong is gaining possession of the death certificate as it can take months unless you pass away in hospital, and the coroner is guaranteed to know how you passed away. The death certificate is needed to accompany your Will and/or to claim assets that you hold in Hong Kong.
Other parts of Asia are much worse if you die without a Will.
Thailand has the spouse as number 7 on the list of heirs, below children, parents, siblings, cousins. Many mixed nationality couples have the Thai spouse own the property or land but unless something is written down to instruct the authorities, when the Thai spouse dies, this part of the estate would go to the Thai’s children, siblings, parents, cousins and not the person who bought the property! Also, in Thailand, there are rules against expatriates owning land or property under most circumstances. How do you inherit something that you are not allowed to inherit?
The Philippines are about to amend their rules to accommodate for spouses receiving assets, no matter where they are from but until then, please be aware that a spouse is number 4 on the list of heirs if you die without a Will. If you purchased your spouse a property and your spouse has not written instructions for you to inherit when they die, their children or siblings or parents could inherit instead of you!
China, Philippines, Vietnam, Thailand, Indonesia and Japan are civil law jurisdictions so you must include children under the primary level of beneficiary or your Will would be invalid if you exclude them. If you hold properties in these jurisdictions you must be careful in understanding the ownership rules.
The main issues concerning inheriting legacies in China are of tax and duty. Real property assets transferred from the deceased are not subject to individual income tax, only deed tax. This tax is defined as the purchasing or acquisition of land and/or buildings are subject to deed tax. The transfer of ownership of land and building refers to:
- The granting of land-use right by the state (not including the transfer of management right of the rural collective land)
- Transfer (including selling, bestowal and exchange) of land use right
- Sale and purchase of buildings
- Bestowal of buildings
- Exchange of buildings
Japan allows you to write a Will from 15 years of age onwards whereas most of the rest of the world insists that you should be 18 (unless you are in the army in which case you can be 16 or above.)
The Middle East, being part of Asia, mainly has Sharia Laws dictating their rules for distribution, very much on the male family side. A special document would have to be drawn up for assets in these areas as a traditional Will would not work and you could become intestate if you died with assets and not an efficient document.
Singapore, Malaysia and India, like Hong Kong are common law jurisdictions meaning you can leave your assets to whoever you choose, within reason. If you disinherited children, per se and left all of your money to the cat orphanage, representatives of your children could petition to have your Will overruled but generally, most people will leave assets to their spouse then children.
One thing to bear in mind is that if you hold assets in different jurisdictions, not only would you have to consider the distribution of your assets but the rules and the laws of the land. It is vital that you hold separate Wills for each jurisdiction as it would take a long time to have your assets distributed with one Will in one jurisdiction alone, for it to be re-sealed and sent onto the next jurisdiction. Your Executor would be busy for a long time with legal documentation. Also, not many countries would accept a re-sealed Will from another jurisdiction.
It can seem confusing, depending upon the jurisdictions that you hold assets in as they all have similar rules but none are the same. You could give an instruction for one jurisdiction and it could contradict or confuse another jurisdiction.
Prevention is always better than cure so check what is relevant to you and your estate per country.
I am happy to help so feel free to contact me to write or update an existing Will, rules may have changed since your last review.
firstname.lastname@example.org +852 2542 2285