As we’ve said in previous posts before, when it comes to the world of estate planning, it can be easy to find yourself lost within the convoluted terminology and the complicated process. Well, if you think regular estate planning is complex, we would recommend having a seat before reading any further. Because today we’re going across the pond to talk about international estate planning.
While this may seem far-fetched, international estate planning is actually incredibly common, mainly for interconnected global families. International estate planning is generally utilized whenever it comes to the distribution of assets and other properties of a specific individual. What can make the process all the more complex when it comes to international estate planning is that each country has its own rules and regulations when it comes to things such as domicile, succession, and even gifted tax laws. While it can be easy to find yourself lost within all these terms, international estate law is relatively easy to understand when you break it down into more minor terms. Luckily, that’s what you have us for. Here’s what you should know about International estate planning.
Know The Basics Of Each Country Involved
Like we said above, each and every country around the world have their own individual rules and regulations when it comes to estate planning and transfer of estate assets and tax. This can be explicitly seen when it comes to taxes based upon citizenship. We all know that every country has its own regulations of what makes someone a citizenship and what doesn’t. For example, in the United States, the estate tax on worldwide assets is different between U.S. citizens, citizens with a green card, and Non-resident aliens. This is also the case for other countries, so that’s why it’s so important to know the regulations of every nation when it comes to estate tax and other aspects of estate planning.
Another aspect of estate planning that changes from country to country is laws and jurisdiction. A common similarity among other countries is that they impose something called an inheritance tax when it comes to situating ones’ estate planning. An inheritance tax is a payment someone has to make on taxes instead of the assets they had inherited. For example, someone who inherited an asset from another country will have to pay the taxes on that asset before truly inheriting it.
The Importance Of Updating Your International Estate Plan
As with anything, life can change at the drop of a pin. This is why it is so important to be willing to change your plans as the life around you begins to change. This goes for both regular estate planning and international estate planning. As we’ve seen recently with a turbulent 2020, laws and regulations are constantly changing in every country around the world. This is especially true when it comes to specific tax laws and regulations. These changes may force you to have to update your international estate plan to abide by these new rules and regulations. Now, we’re not saying this will definitely happen. All we want to do is warn you that you may need to be prepared to make a few changes and alterations to your estate planning.