A foreign will may be valid, but still create practical difficulties

Many foreign residents assume that the will they signed in their country of origin will automatically deal with everything.

In some cases, that may be correct. However, even where a foreign will is valid, using it in Portugal may involve practical difficulties. Portuguese banks, tax authorities, notaries and registries may require the document to be produced, translated, legalised or apostilled before it can be relied upon. If the will was drafted under a different legal system, its interpretation in Portugal may also require additional legal analysis.

There may also be uncertainty as to whether the foreign will covers Portuguese assets clearly, whether it revokes or conflicts with another will, or whether it takes into account the fact that the person is now habitually resident in Portugal.

This does not mean that every foreign resident needs a Portuguese will. It does mean, however, that anyone living in Portugal with assets or family connections in more than one country should review their succession planning carefully.

Habitual residence can change the succession analysis

For succession matters within the European framework, the general rule is that the law applicable to a person’s succession is the law of the country in which that person had their habitual residence at the time of death.

This can be highly relevant for foreign nationals who have lived in Portugal for several years. Even if they are not Portuguese citizens, Portuguese law may become relevant if Portugal has become their centre of life.

The same European rules also allow a person to choose the law of their nationality to govern their succession. This choice should be made clearly, usually in a will. Where a person has more than one nationality, specific care should be taken in deciding whether a choice of law is possible and how it should be drafted.

This is one of the main reasons why a will should not be seen as a document that is signed once and then forgotten.

Moving country can change the legal context.

Portuguese forced heirship rules may apply

If Portuguese succession law applies, testamentary freedom is not unlimited.

Portuguese law protects certain close family members through forced heirship rules. These protected heirs generally include the spouse, descendants and ascendants. Where forced heirship applies, a reserved portion of the estate must pass to those heirs and cannot be freely disposed of by will.

This may be very different from the rules of other legal systems, where a person may have greater freedom to leave their estate to whoever they choose.

For foreign residents, this can be particularly important in family situations involving second marriages, children from previous relationships, unmarried partners, estranged relatives or a wish to benefit specific persons unequally.

A properly drafted will can help clarify the testator’s wishes and, where possible, make use of the available legal options.

It can also help reduce uncertainty and avoid disputes between heirs after death.

Unmarried partners require particular attention

Many foreign residents live in long term relationships without being married. In some jurisdictions, unmarried partners may have inheritance rights or may be treated in a similar way to spouses. In Portugal, the position is different.

If Portuguese law applies, an unmarried partner does not automatically have the same succession position as a spouse. This means that, in many cases, a partner will only inherit if the deceased has made a will benefiting that partner, and even then within the limits of any forced heirship rules.

This is a particularly important point for international couples who live together in Portugal but have never married, or who assume that their partner will automatically be protected.

A will can be essential in these situations.

A Portuguese will can simplify matters

A Portuguese will may be particularly useful where a foreign resident owns assets in Portugal, especially real estate.

It can make it easier for Portuguese authorities to identify the testator’s wishes in a familiar form. It can also clarify whether the testator wishes to choose the law of their nationality, deal specifically with Portuguese assets or coordinate their Portuguese estate with wider international estate planning.

In Portugal, the most common forms of will are the public will and the closed will. A public will is prepared by a notary. A closed will is written by the testator, or by another person at the testator’s request, and then approved by a notary in accordance with the applicable formalities.

The right option will depend on the person’s nationality, language, family situation, assets and existing estate planning documents.

One will or several wills?

International clients often ask whether they should have one will covering all assets worldwide or separate wills in different countries.

There is no single answer.

As a general rule, succession should be approached as a whole and not simply by reference to the number of countries where the person owns assets. However, where assets are located in different jurisdictions, it may be useful, from a practical perspective, to have separate wills dealing with assets in each relevant country.

For example, a foreign national who owns property in Portugal and in another country may decide to have a Portuguese will dealing specifically with Portuguese assets, while maintaining a separate will for assets located elsewhere. In such cases, it is particularly important that the wills are carefully coordinated and, where appropriate, reflect the same choice of applicable law.

However, this must be done carefully. A new will can unintentionally revoke an earlier will if it is not properly drafted.

Different wills can also create uncertainty if they overlap, use inconsistent language or appoint different persons to deal with the same assets.

For this reason, Portuguese and foreign wills should be coordinated. The goal is not to multiply documents unnecessarily. The goal is to make sure that all documents work together.

When should foreign residents review their will?

Foreign residents in Portugal should consider reviewing their will or estate planning in particular when:

• They become habitually resident in Portugal.
• They buy real estate in Portugal.
• They already have a will made in another country.
• They have assets in more than one jurisdiction.
• They get married, divorced or enter into a new relationship.
• They have children from different relationships.
• They live with an unmarried partner whom they wish to protect.
• They wish to choose the law of their nationality.
• They want to avoid unnecessary complexity for their heirs.
• Their existing will was drafted before the move to Portugal.

These situations are common among foreign residents and international families. They do not always require a new will, but they do justify a careful review.

Tax is not the only issue

When discussing inheritance, many clients focus first on tax.

Portugal does not have inheritance tax in the same way as some other jurisdictions. However, certain transfers upon death may be subject to Stamp Duty. Exemptions may apply to close family members, such as spouses, unmarried partners in legally recognised situations, descendants and ascendants.

That said, tax is rarely the only issue.

In practice, many succession problems are documentary, family, registry or cross border problems. The real difficulty often lies in proving who the heirs are, identifying the applicable law, dealing with foreign documents, registering assets, accessing bank accounts and coordinating the estate across different countries.

A clear and well planned will can make this process significantly easier.

A practical step for peace of mind

Making or reviewing a will is not only about planning for death. It is about protecting the people who will have to deal with the estate afterwards.

For foreign residents in Portugal, a will can help avoid uncertainty, reduce administrative burdens and ensure that their wishes are properly understood in the country where they now live.

Portugal may be the place where you bought your home, built your routine and chose to spend an important part of your life. Your estate planning should reflect that reality.

A Portuguese will, carefully coordinated with any existing foreign will, can be a simple but important step to protect your family, your assets and your wishes.