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Does EU Law Still Apply To My Estate?
The EU Succession Regulation more commonly known as the Brussels IV (the Regulation) came into force in 2015. The main objective of the Regulation is to simplify cross-border estates and succession planning which is particularly important with more geographic mobility in the world today than ever before.
Position prior to the Regulation
Prior to the introduction of the Regulation, if an individual had connections to the UK and more than one EU member state, each state had its own rules to determine which court had jurisdiction. This in turn lead to uncertainty and complications in the estate administration.
Position after the Regulation
The key provision of the Regulation is that the court in which the deceased died habitually resident have jurisdiction in succession matters. The Regulation also does not distinguish between property that is movable or immovable.
The default position under the Regulation may, however, be overridden in two circumstances:
- Habitual residence can be displaced by an election made in an individual’s Will for the law of their nationality to apply; or
- The individual is manifestly more closely connected with another jurisdiction at the date of their death.
For example, if an individual is habitually resident in a jurisdiction subject to the Regulation, but their Will contains an election for English law to apply to their estate as this is their nationality, this could effectively apply English law to their estate across not just the UK but also other member states in which they hold assets.
How does an EU regulation effect the UK?
Despite the UK not being part of the EU, the Regulation is important for individuals who have assets and connections to the UK and an EU Member State.
In 2015, the UK was one of the few Member States to opt out of the Regulation and considered a “third state”. Practically, this means that whilst the UK is not bound by the Regulation or subject to its application, it does affect the way in which conflict of law rules in the UK interact with the EU Member States where the Regulation does apply.
It is important to add that there has been no change in how the Regulation affects the UK since Brexit.
The importance of making an election and a practical example
Rose is a UK national, who has lived in Spain for the last 15 years. She still has a property in the UK that her husband lives in, but they are separated, and she has two estranged children she has not seen for 20 years. Spain has forced heirship rules and Rose does not wish for her children or husband to benefit from her estate and instead wishes for her estate to pass to her nephews.
Rose could therefore put in place a worldwide Will that includes an election for the law of her nationality to apply to the succession of her estate therefore disapplying forced heirship. She would therefore have testamentary freedom under English law to leave her estate to her nephews regardless of the fact she is habitually resident in Spain.
A nationality election also gives greater certainty than relying on habitual residence as a default. This is particularly relevant for internationally mobile individuals who move around regularly therefore meaning that their habitual residence is changing constantly. By electing for the law of their nationality to apply to their estate, this gives them certainty of the succession of their estate in relation to their assets within the EU. Rose in this circumstance would therefore also have certainty that this will remain the position even if she moves in the future.
If you have any queries relating to cross-border estate planning, please contact Ben Rosen or Eleanor Catling at Quastels LLP.
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Demystifying Trusts: Answers to Google’s Top Questions with Ben Rosen
In the video, private wealth & tax partner Ben Rosen tackles the most-searched public queries around one of the most frequently misunderstood vehicles in wealth planning–trusts. Following the response to our video on Diary of a CEO‘s tax debate, it became clear from the online commentary that people are unfamiliar with how they operate, particularly regarding taxation, asset protection, and on the death of a family member. Ben steps in to clarify.
Why are trusts used?
One of the most common misconceptions is that trusts exist primarily to avoid tax. In the UK, this simply isn’t the case. While tax considerations may come into play, trusts are fundamentally tools for succession planning, helping individuals preserve and manage wealth across generations.
Ben illustrates this with a relatable scenario: Imagine a successful business owner with two children, one actively involved in the business, the other not. The family may have concerns about inheritance being affected by potential issues like divorce, bankruptcy, or addiction. A trust can provide a balanced, protective structure, allowing the parent to support both children while safeguarding the longevity and values of the family business.
Why are trusts seen as complicated?
This often depends on who you ask. At their core, they are not complex. They are not standalone entities, but rather legal relationships between:
- The trustees, who look after the trust assets in accordance with the trust deed; and
- The beneficiaries, who can benefit from those assets.
The trust deed is a legal document outlining the powers and responsibilities of the trustees. Often accompanying this is a letter of wishes, a non-binding document that guides trustees on how to exercise their discretion in line with the settlor’s values and intentions.
The complexity often arises from legal terminology, not the concept itself. As Ben points out, understanding the “code” behind the legalese can make things clearer, something lawyers are trained to do for their clients.
Why are trusts so expensive?
Trusts exist on a spectrum. Some, like bare trusts, are straightforward and inexpensive. These might simply hold assets until a child reaches 18. Others, especially those involving complex family dynamics, business interests, or long-term planning, require tailored legal and tax advice, which can increase costs. The level of complexity, and therefore expense, should reflect the needs and goals of the person setting up the trust.
Why are trusts allowed?
Trusts are not shadowy loopholes; they are lawful, regulated structures. In the UK, most trusts must be registered with HMRC’s Trust Registration Service (TRS). This ensures transparency and compliance with financial and anti-money laundering regulations. Trusts are allowed within strict legal boundaries, and their existence supports legitimate planning needs, particularly where families are navigating intergenerational wealth or complex personal circumstances.
Final Thoughts
As Ben make clear, the purpose of trusts is not to game the tax system, but to provide flexible, legally recognised ways to protect assets, plan for the future and honour family wishes. When designed and administered properly, trusts are not about secrecy, they’re about clarity, control, and care.
Watch the full video to hear Ben’s answers in depth and understand why, far from being loopholes for the wealthy, trusts are vital tools for anyone navigating life’s complexities with foresight.
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When It’s Too Late To Choose: The Cost Of Not Having A Lasting Power Of Attorney
Planning for the future is a vital part of ensuring personal affairs are managed effectively if capacity is lost.
A Lasting Power of Attorney (LPA) is a legal document that allows an individual (the donor) to appoint a trusted individual (or individuals) to make decisions on their behalf should they become unable to do so.
Failing to put in place an LPA can lead to complex, time-consuming, and costly consequences.
Types of LPA
There are two types of LPA in England and Wales:
Property and Financial Affairs LPA
This covers decisions such as managing bank accounts, paying bills, and selling property.
Health and Welfare LPA
This relates to care needs, medical treatment, and life-sustaining decisions.
Both must be made whilst the donor has mental capacity and registered with the Office of the Public Guardian to be valid.
What does it mean to lose capacity?
Mental capacity refers to the ability to make a specific decision at the time the decision needs to be made. This includes understanding information relevant to decision making, retaining it long enough to weigh up options, and communicating a choice.
Capacity can be lost gradually, such as through dementia, or suddenly, due to a stroke or serious injury. Importantly, capacity can fluctuate, and it may be that an individual might lack capacity at a particular point in time but regain it later.
As well as time-specific, capacity is also decision-specific, and a person may lack the capacity to make one kind of decision, but retain capacity to make others.
Without the necessary capacity, you may be unable to manage your financial affairs, make decisions about your health and welfare, or even handle day-to-day matters.
Critically, once capacity is lost, it is too late to put an LPA in place.
What happens if you lose capacity without an LPA?
If you lose mental capacity and do not have an LPA in place, no one automatically has the legal authority to manage your property or finances, and only the healthcare professionals treating you will be able to make health or welfare decisions on your behalf, acting in what they believe to be your best interest. In this situation the Court of Protection must be involved, and someone (often a loved one) must apply for a deputyship order to act on your behalf. This process can be:
Lengthy
The application process typically takes 6-12 months, and potentially longer if contested or delayed. During this time, no one can legally manage your finances or make decisions, which can affect bill payments, care arrangements, or property sales.
Costly
Costs include application fees, legal fees, medical assessment costs, and ongoing annual fees for example. A deputyship is much more time consuming and costly compared to making an LPA.
Restrictive
A deputy’s powers, once granted, are limited, and they are subject to ongoing court oversight.
Stressful
Applying to the Court of Protection for a deputyship order is a process that can be slow, expensive, and emotionally taxing, especially if there is a disagreement over who should apply or how decisions should be made. The lack of clarity and legal authority can cause confusion, disputes among family members, and emotional distress at an already difficult time.
Why set up an LPA?
An LPA is a legal document that allows you to appoint one or more trusted individuals (your attorneys) to make decisions on your behalf if you lose capacity. Key benefits include:
Control
You choose who acts for you and you can set out clear instructions or preferences.
Speed and simplicity
Attorneys can either act immediately once the LPA is registered (Property and Financial Affairs LPA only), or once you’ve lost capacity.
Peace of mind
Having a valid LPA in place can avoid the cost, delay, and complexity of court proceedings.
Respect for your wishes
LPAs can be tailored to your wishes and ensures that future decisions made by your Attorneys reflect your values and preferences.
A vital safeguard for everyone
An LPA is a vital part of lifetime planning, just like a Will. Without it, your finances, health, and welfare decisions could fall into the hands of the Court rather than trusted individuals of your choosing.
To discuss your requirements and find out how we can help you, please get in touch.
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