Wills and the globalisation headache
Due to ongoing globalisation, many families find themselves spread out across different countries. When divorces and second marriages are added into the mix, sorting out the estate of a high net worth individual who had assets and families in various jurisdictions quickly becomes a quagmire that can wreck the work of wealth management advisers. According to recent research conducted by Forbes, seven out of ten of the world’s billionaires are self-made, and over 40 per cent of those directly involve their family in the management of their wealth. Those who don’t leave an up to date will can cause dissension within families and cause a high proportion of their wealth to be wasted as a result.
Cross-jurisdictional issues, particularly where a will is being contested or simply does not exist, frequently complicate the procedure of fairly dividing an individual’s assets amongst their family. I have advised in many cases where the deceased has properties and other assets spread across different countries. Some foreign countries have “forced heirship‚Äù, with different inheritance consequences. Complicated family situations such as divorces, remarriage and the introduction of new children into the family can cause further problems, especially when these are not reflected in the individual’s will.
Where a client has a complex array of assets and/or a complicated family situation, wealth management advisers should ensure they are fully aware of the individual’s true legal position in the jurisdictions in which their client’s assets are based. Rather than falling into the trap of ignoring assets based in other jurisdictions because the client insists, “the lawyer there sorted the succession out so you can ignore that,‚Äù wealth managers and lawyers must work together for a solution that is legally effective.
Wealth managers are also very aware of the fall out in terms of inheritance taxes from an incomplete or non-existent will.
Individuals who have assets spread across various jurisdictions will require a more sophisticated level of advice. This is where the expertise of an adviser who understands the interplay between the regimes of various jurisdictions is invaluable.
Failure to update a will whenever necessary and neglecting to take into consideration cross-jurisdictional issues will lead to considerable trouble, not just for the family but also for the hapless adviser.
Henry Brookman is a founding partner of Brookman Solicitors