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Old 27.03.2020, 10:27
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inheritance quandry

Setting up a Swiss Will, but do not own property anywhere.
If I die, partner and children will need to leave CH.

Question:
Basically can you set up life-long usufruct on liquid assets, not just fixed property? so that my partner will have use of the liquid assests, inherited by the children (50% of the estate), until partner's death?

I contacted a notary, and they put us off until crisis is over....
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Old 27.03.2020, 10:43
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Re: inheritance quandry

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Setting up a Swiss Will, but do not own property anywhere.
If I die, partner and children will need to leave CH.

Question:
Basically can you set up life-long usufruct on liquid assets, not just fixed property? so that my partner will have use of the liquid assests, inherited by the children (50% of the estate), until partner's death?

I contacted a notary, and they put us off until crisis is over....
Thats what trusts are all about however set up & running costs are HUGE & will use 50% plus of the fund in 30 years on a 1,000,000 trust.
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Old 27.03.2020, 10:58
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Re: inheritance quandry

How can they use the liquid assets without using them up?

Tom
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Old 27.03.2020, 11:30
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Re: inheritance quandry

You want/need to make will under Swiss law but are then bound by the inheritance laws here.
You appear to want your partner, in addition to the 50% this partner gets directly from your estate to have "access" to the remaining 50%, but maybe also somewhere the hope that there might be something remaining for the children when they reach a specific age.

As has been pointed out, this is a classic trust arangement. I have some experience of this because my father made a will (this is all under English law) leaving a part inheritance to some of his grand children, but stipulating that they had access to it when they were 21. This created a default trust situation when he died, with the executors (a solicitor and myself) automatically becoming trustees. I would be very careful of accepting such a role in the future. It is not the administration (there is a tax form to complete) and rules to be observed about how the money is spent. It is the conflict situation involving people who want immediate access to money which they should not (yet) have.

Your situation is even worse for the trustees. Your partner would (human nature being what it) would at least potentially operate a "use it or lose it" policy and leaving nothing for the children.

If your main concern is that the partner gets as much as possible and the children are not a concern, then maybe explore making the will under another jurisdiction to avoid the mandatory distribution principle.
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Old 27.03.2020, 11:34
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Re: inheritance quandry

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How can they use the liquid assets without using them up?

Tom
You used to be able to say that the capital passed to X but Y could use the interest until death or a specific date. But now interest at 0.00001% is not very, well, interesting.
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Old 27.03.2020, 11:36
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Re: inheritance quandry

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How can they use the liquid assets without using them up?

Tom
They are entitled to the income but not capital
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Old 27.03.2020, 11:45
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Re: inheritance quandry

I realise you might have something more complex in mind, yet recommend first being sure that you understand your maximum room for action within the available more straightforward parts of Swiss inheritance law.

For anyone else reading this, and not sure how it works, here's a nice illustration of the percentages which go to each heir.
https://www.berghilfe.ch/was-sie-tun...CAAEgIocvD_BwE
From the list on the left, select your currenty family set-up. Click "Weiter", bottom right, and it'll draw you two pie-charts.

The left-hand pie chart shows what happens if you die intestate. The right-hand one shows the extent to which you can reduce the heirs to their "Pflichtteil" (obligatory, protected inheritance). Once you do that, the remainder (shown in turquoise as "frei verfügbar") is yours, freely available to distribute as you wish, including allocating some extra share to one of the heirs, or leaving it to any other person or organisation of your choice.

In your case, OP, with partner and children, with that simple step you could therefore leave your partner 62.5 % instead of 50%, or the other way round.

Last edited by doropfiz; 27.03.2020 at 19:23.
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Old 27.03.2020, 11:47
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Re: inheritance quandry

Thank you.


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You want/need to make will under Swiss law but are then bound by the inheritance laws here.
You appear to want your partner, in addition to the 50% this partner gets directly from your estate to have "access" to the remaining 50%, but maybe also somewhere the hope that there might be something remaining for the children when they reach a specific age.

As has been pointed out, this is a classic trust arangement. I have some experience of this because my father made a will (this is all under English law) leaving a part inheritance to some of his grand children, but stipulating that they had access to it when they were 21. This created a default trust situation when he died, with the executors (a solicitor and myself) automatically becoming trustees. I would be very careful of accepting such a role in the future. It is not the administration (there is a tax form to complete) and rules to be observed about how the money is spent. It is the conflict situation involving people who want immediate access to money which they should not (yet) have.

Your situation is even worse for the trustees. Your partner would (human nature being what it) would at least potentially operate a "use it or lose it" policy and leaving nothing for the children.

If your main concern is that the partner gets as much as possible and the children are not a concern, then maybe explore making the will under another jurisdiction to avoid the mandatory distribution principle.
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Old 27.03.2020, 13:31
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Re: inheritance quandry

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Y, then maybe explore making the will under another jurisdiction to avoid the mandatory distribution principle.
Would your home country's inheritance laws allow what you wish to do, or make it easier?

If so, and if you are not a Swiss citizen, then claiming Heimatrecht is one way to go.

The simplified version: Write a handwritten letter making the claim of Heimatrecht, specify that you have made a will under your country's laws and include a copy of that will or give details of where that will is to be found, lodge that letter with the Gemeinde or official notary. (There is a holding fee for this in my Gemeinde.)

This is only available if you are not a Swiss citizen.
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Old 27.03.2020, 18:12
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Re: inheritance quandry

As others have said you need to decide whether you want your assets to devolve according to Swiss law or that of your home jurisdiction or both. You can ignore Swiss private international law and — if you are American or have US assets — create a Revocable Living Trust, typically in California, governing specified US assets. Look online for sample trust documents but don’t try to do it yourself. In many states a RLT when a will substitute has to have 2 witnesses. In Calif it is typically notarised. You can figure a cost of $1k to $3k and no trustee charges as you (and/or spouse) are trustees until death. A Swiss will can be holographic (hand-written not typed: if you have 2 witnesses it is sure to be honored worldwide) or done by a notary who will charge a percentage of assets.

There are issues if you are a U.K. domiciliary or have UK assets. Then the RLT has to be carefully drawn to avoid input/output/decennial IHT (and be a nontaxed bare trust).

I haven’t addressed all issues: if you have jealous heirs they might complain that your common-law-country disposition doesn’t accord with Swiss forced heirship and demand reallocation of Swiss assets (if you have any) to compensate. See the Caron v. Odell case online (Leslie Caron’s father). As far as a common-law country is concerned you can have different wills for different countries’ assets (but most lawyers are incompetent and might make mistakes: once upon a time I made my living with these and also with bankruptcy and tax...)

I am a retired NY trust and estates lawyer. I have US & Swiss nationality. I don’t practice anymore but do know what I am talking about.

Last edited by Caryl; 27.03.2020 at 18:27.
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Old 28.03.2020, 14:22
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Re: inheritance quandry

Some might find this old (and probably outdated in some respects) handout from the Swiss Embassy in Washington about cross-border succession: http://uniset.ca/misc/swissestates.pdf
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Old 28.03.2020, 17:01
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Re: inheritance quandry

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Setting up a Swiss Will, but do not own property anywhere.
If I die, partner and children will need to leave CH.

Question:
Basically can you set up life-long usufruct on liquid assets, not just fixed property? so that my partner will have use of the liquid assests, inherited by the children (50% of the estate), until partner's death?

I contacted a notary, and they put us off until crisis is over....
You can under Swiss law if you're married or have a registered partnership.

This is done by an "Ehe- und Erbvertrag" (no idea about the French term), that's an officially registered and mutually applicable combination of matrimonial and inheritance contract between the two spouses. Such a contract typically(always?) rules that the surviving spouse gets to use the marital assets until death, upon which what's left is distributed according to the respective spouse's testament.

Disposition in any form (sale, gift, whatever) of any such asset must be agreed to by the spouse and all designated heirs. That probably means, too, that a securities account can't be moved unless all agree. I mention this because having to keep such an account in Switzerland may be tedious, and potentially onerously expensive for Americans.
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