Civil
Law Regulations
The provisions of mortis
causa succession regulate the transfer of property and the continuation of
all legal relationships, in terms of assets and liabilities, from the deceased
to his/her heirs.
Succession
begins at the time of the death, in the place where the deceased had his/her
last domicile.
When a person dies, it is
necessary and appropriate to ascertain whether the succession being discussed is
governed by law (intestacy: the
deceased dies without making a will and the heirs are appointed by law) or by
will (testate succession: the succession is enacted according to the
provisions of the testator’s will, but in the manner and within the limits
prescribed by law).
Where
the deceased has not made a disposition by will of the whole estate, the
succession will be performed in
compliance with the intestacy rules for the undisposed part of the property.
Under
the intestacy rules, legitimate heirs are the deceased’s spouse and the
relatives up to the sixth degree of kinship; if he/she leaves no surviving heirs,
the inheritance is devolved to the State.
In
the absence of a spouse, at the death of the intestate, his/her successors will
be the legitimate (children conceived
by married parents), natural (children
conceived by unmarried parents), legitimated
(children born out-of-wedlock who are recognised as legitimate through
subsequent marriage of the parents or by court order) and adopted children.
Should the spouse and an only child alive,
either legitimate or natural, survive the deceased, both would inherit half of
the estate.
In the event of more than one child, the spouse
is entitled to a third of the inheritance whereas the residuary estate is
equally shared among the children.
Should a person die without issue, the
law provides that, in the absence of a husband or wife, anyone of the
deceased’s ascendants, brothers and sisters, shall succeed as sole heir or
jointly, in equal shares, if more than one.
Where the intestate leaves a husband
or wife, without issue, the spouse shall inherit two thirds of the estate, in
the event that the spouse shares the estate with the deceased’s legitimate
ascendants or brothers and sisters, including half-blood siblings, (the term half-blood denotes the degree of relationship of brothers and
sisters who do not have both parents in common; whole blood denotes kinship by descent from the same father and
mother), or with both classes of relatives.
The husband or wife shall succeed to the whole
estate only in the absence of legitimate or natural children, ascendants and
brothers and sisters.
In the case of a person dying without
leaving any issue, parents or any other ascendants, nor any siblings or
respective descendants, the property goes to the closest relations, without
distinction in the line, though within the sixth degree, of kinship.
In addition, intestacy rules include specific
provisions for the succession of half-blood and adopted brothers and
sisters, natural children without legitimacy rights, and putative and
separated spouse.
Otherwise,
in the absence of every class of kindred stated above, the inheritance is
devolved to the State.
The
rules on estate devolution to legitimate heirs distinguish relatives’
succession by direct or collateral line, as well as the degree of kinship
(kinship is the tie between the people descending from the same ancestor; the lineal descent is given by relations descending one from the other (father
and son); in the collateral descent,
individuals, while sharing a common ancestor, do not descend one from the other
(brother and sister).
With
regard to the degree of kinship, the deceased’s closest relations exclude
remoter ones; the property is distributed in equal shares among same-degree
relatives, although sometimes exceptions may apply.
In
order to pinpoint succession provisions, a first necessary step is to see
whether the deceased has executed a will
(revocable deed with which a person, disposes, for the time after his/her death,
of the whole or part of his/her property; this deed has effect only at the death
of the testator).
First
of all, under the existing laws, a will may contain estate and non-estate
provisions.
Testamentary
provisions, therefore, may have universal (inheritance)
and specific (legacy) character: the
former include the whole or a part of the testator’s property and confer upon
their beneficiary the title of heir; specific provisions consist of one, or more
than one, asset and right and confer the title of legatee[1].
Under the succession law,
the holograph will and the forms of will by notarial act (namely public and
secret will) may be recognised.
The
holograph will is entirely written,
dated, and signed by the hand of the testator; the signature must be placed
right after the testamentary provisions and the date must indicate day, month
and year.
The
public will is received by the notary
in the presence of two witnesses. The testator declares his/her intentions to
the notary, who writes them down, always in the presence of the two witnesses,
and subsequently reads them to the testator. Specific rules are prescribed in
the event of a testator that is unable to sign the public will, or can do so but
with great difficulty, or is mute, deaf or deaf-mute.
The
secret will is written by the
testator or a third party, also by means of word-processing devices. It is made
up of two deeds: the first is the
testamentary document, containing the testator’s will; the second is the
notarial act of reception, where the notary, in the presence of two witnesses,
certifies that the testator has personally delivered the testamentary document
declaring that it expresses his/her own will. Specific rules apply as to the
formalities required in drafting testamentary documents and notarial acts of
reception.
The
international will is the document that contains the testator’s dispositions and
is delivered to the notary. The notary, in the presence of two witnesses,
receives it and at the same time the testator declares that stated document
constitutes his/her will and that he/she knows of the provisions contained
therein. The aforesaid is the only admissible procedure in the execution of the
international will in
Italy
, pursuant to the Italian Law dated 29 November 1990 n. 387 ratifying the
Washington Convention of 26 October 1973. The international will may be drafted
by a foreigner in the Italian territory, or by an Italian citizen abroad (in the
latter case, if the testator made his/her international will in a foreign State
that has ratified said Convention,
the relevant formalities are regulated by the laws of the foreign country). If
drafted in the form laid down in the Convention, the
document is valid as long as its execution takes place in a State that
has ratified said Convention.
The
special wills are drawn up during
particular events (infectious diseases, public disasters or accidents; on board
of ships or aircrafts; wills by soldiers on a mission for the armed forces of a
State). Their peculiarity is that they become void after three months from
termination of the cause that prevented the testator from executing a will in
the ordinary manner and forms, or after the testator has reached a place where
it is possible to adopt such manner and forms.
Anyone
who knows of and holds a holograph will, as soon as informed of the testator’s
death, shall surrender it to a notary in order
to have it published.
Similarly, anyone who knows
of a public, secret, or holograph will filed with a notary, shall contact the
notary for the execution of required formalities.
On the other hand, where
the existence of a will is ignored, it is possible to contact the District
Notary Archives in order to make a search in the General Registry of Wills.
The
testator, who intends to devolve his/her property by will, must secure to
certain persons (forced heirs: spouse,
legitimate, natural, legitimated, and adopted children, descendents of the
legitimate or natural children, where they inherit instead of the latter, and
legitimate ascendants), a portion of the estate (the so-called
quota
di legittima) pursuant to the rules of the forced
succession or the forced heir succession. The testator, however, is free to execute a will without
including the forced heir among its beneficiaries.
Should
a testator fail to mention said beneficiaries, the forced heirs are entitled by
law to take legal steps to claim abatement, to their advantage, of the
testator’s provisions that may be damaging their ‘quota di legittima’ (action
in abatement). Notwithstanding this, the forced heirs, in accordance with
the testator’s will, may accept the provisions impairing their rights, whereas
they cannot be disinherited by the testator.
By
law, in order to attain the devolved estate, the entitled beneficiary, is
obliged to accept it.
The
express acceptance occurs when, by
means of a public or private deed, the beneficiary declares to accept the
devolution effect or takes on the title of heir; the tacit acceptance is given when actions are taken by the beneficiary
which necessarily suppose his/her intention to accept and which he/she would
have no right to do but in his/her capacity as heir (e.g., the sale of an asset
included in the inheritance).
The
heir inherits all assets and liabilities: as a result, before accepting the
inheritance, it is desirable to ascertain the existence of any debts of the
testator towards third parties. The heir, indeed, is liable for all the debts
arising from the succession, if the whole estate is devolved to the him/her,
whereas he/she will be obliged to a partial payment, if he/she only succeeds to
a quota of said estate.
The
law provides for two types of acceptance:
an unconditional acceptance and an
acceptance with the benefit of inventory.
The former implies that the
deceased’s estate and the heir’s estate become one single estate and the
heir, having succeeded to the liabilities, shall pay the deceased’s debts,
even if they exceed the assets; the acceptance with benefit of inventory, that
must always be expressed (through a declaration before a notary or a clerk of
the court, in the district where the succession has commenced, that is the
deceased’s last place of abode), keeps the respective estates separated by
compiling an inventory report. Thus the inheritance composition is ascertained
and, as a consequence, succession debts and legacies are discharged by the heir
exclusively for the value of the inherited property.
The
intention not to inherit from the deceased is also expressed by disclaimer,
with declaration rendered to a notary or a clerk of court in the district of
succession.
Unlike
the heritage, for a legacy (disposition of a specific character implying the transfer of
a given asset or another right, at the death of the testator) to be attained, no
acceptance is needed as there is automatic acquisition. Yet, by law the legatee
(the beneficiary of the legacy) is entitled to refuse the testamentary gifts.
The
law provides for those cases where the designated heirs or legatees are unable
or unwilling to accept (substitution,
accretion, representation) and identify the individuals who cannot dispose of
their estate by will and the individuals who are unworthy of succession.
Specific
rules apply for the succession of incapable persons and for the appointment of executors,
whose main task is to take possession of the testamentary estate and administer
it, until it is transferred to the heirs, as in the testator’s intentions.
Fiscal
Law Regulations
Under the Italian fiscal
system two tax categories may apply:
a)
Income taxes, affecting tax liability directly
(e.g., property right on a real estate or possession of an income);
b)
Indirect taxes, affecting tax
liability indirectly
(e.g., transfer of assets inter
vivos or for mortis causa succession).
Indirect taxes feature,
among others, the Succession duty
that was repealed by the Italian legislator with the Law 18 October 2001 n. 383.
In
Italy
, any successions occurring as of 25 October 2001 (succession commences at the
death of the deceased) is no longer subject to the relevant duty.
In the event of real estate
transfer (lands and buildings) by succession, the following dues apply:
a)
Mortgage taxes, for the
transcription of the transfer in the register of immovable property;
b)
Cadastral taxes, for the
registration change in the Land register.
The registers of immovable property
and the land registers are kept with the Territorial Agency in the place where
the real estate is situated.
The mortgage and cadastral taxes are
calculated according to the immovable value or the real right transferred by
succession. The individual tax rates are as follows:
-
Land e buildings– Mortgage tax 2%
-
Land e buildings – Cadastral tax 1%
Additional tax benefits
apply for the heir or the legatee who acquires his/her
first house as a result of the
mortis causa succession (as well as
any appurtenances, such as garage, cellar or storeroom): exemptions here apply
not only for the succession duty,
but also for mortgage and cadastral taxes; in lieu of these dues, the
successors’ contribution is limited to two fixed taxes of EUR 168 each.
The heir or the legatee, who by mortis
causa succession holds a real property, must submit a declaration
of succession to the Inland Revenue Agency of the place where the
deceased had his/her last domicile within the present time-frame of 12
months from the death of the deceased.
The declaration shall contain the
heir’s, or the legatee’s, personal data, residence or domicile, and
taxpayer’s code, as well as the data concerning the transferred immovables,
including cadastral references. The declaration of succession must enclose a
receipt of the relevant taxes paid.
If the deceased resided abroad at the
time of the his/her death, the
appropriate Inland Revenue Agency for the submission of such declaration is
located in the district where the deceased had his/her last Italian residence;
otherwise, the appropriate agency is in
Rome
.
To sum up, currently both real
and personal (money, jewels, paintings, securities, corporate stocks or
shares, and movables in general) estate
transfers in
Italy
are not subject to the Succession duty. As stated above, only mortgage and
cadastral taxes are levied on immovable transfers. Accordingly, most of the
foreigners who own real assets in
Italy
, are increasingly taking up their tax presence in this Country.
***
The
information contained in this introductory guide is believed to be correct as at
the date indicated below. However, as the guide contains mere summary references
to some general and specific laws of
Italy
, the AUTHORS will not accept responsibility or liability for error, omission or
liability arising from the consequences of using or relying on the information
contained in this guide.
Revised
April 2005
***
All
rights reserved. No part of this publication may be reproduced, stored in a
retrieval system, or transmitted in any way or by any means, electronic,
mechanical, photocopying, recording or otherwise without t
[1]
The Italian term includes both the notion of devise and legacy itself.
Accordingly ‘legatee’ also denotes ‘devisee’
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