Basic Information on Inheritance Law in Portugal

Inheritance and successionInheritance Tax Inheritance Tax has been abolished in Portugal. There is still a 10% stamp duty charge on transfer of assets. Gifts or donations to a spouse, children, parents or grandparents are exempt. Inheritance tax laws in Portugal date back to 1899 and as such contain a number of anomalies.Where due, inheritance tax is payable by the recipient rather than the donor. There is a very strange exemption where bank accounts held in Portugal by non-residents are not liable for inheritance tax so long as this is the only asset the deceased possesses in Portugal. Non-residents are otherwise liable to full Portuguese inheritance tax. Inheritance tax calculation in Portugal is tortuous and is based on both the relationship between donor and recipient as well as the value of the capital items. Relationships are broken into four classes with values divided into seven bands. This results in a liability ranging from 0 to 50 per cent depending on the relationship and value. The resultant tax is payable over a period of three years in six monthly instalments. Succession law for Portuguese residents protects the rights of inheritance of certain of your heirs, known as "reserved heirs". These rights cannot be overridden by the terms of a will. These rights are quite complex and cannot be examined in full here,but an example is that a surviving spouse is entitled to two thirds of the estate with only one third available for free distribution. For non-residents in Portugal, however, the deceased's national law takes precedence which means that Portuguese succession laws will not apply.

 

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