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Estate Planning in Algarve, Portugal pertains to the creation and management of a plan for handling personal affairs while you're living and distributing your assets after death. It typically involves creating wills, setting up trusts, appointing heirs, and managing assets. Portuguese law applies "forced heirship" rules, meaning a percentage of assets must be left to certain family members (spouse, children) by law. However, since Portugal signed the EU regulation that allows foreign citizens to apply their home country law to their estate, non-residents have some flexibility in their estate planning.
There are various situations where you may require legal help in estate planning. If you own property, a business, or have substantial assets in Algarve, a lawyer can guide you through the complexities of Portuguese law to protect your interests. If you are an expatriate, it may become even more important to work with a lawyer who understands both Portuguese law and the estate planning laws of your home country. The death of a loved one or planning for future incapacity are situations when legal assistance can be an invaluable resource.
As mentioned, Portuguese law governs that a certain percentage of your estate must be left to specified family members. Called the "compulsory portion", it gives the children (or, in absence, the parents or spouse) the right to a portion of the inheritance. Additionally, Portuguese law does not recognize trusts, and estates are not taxed upon death but any inheritance can be subject to stamp duty. Importantly, the EU Succession Regulation offers non-residents the option to apply their home country law to their Portuguese estate.
To ensure assets and property are distributed according to your wishes upon death, it is highly advisable to have a properly drafted will that complies with Portuguese legislation or the law of your home country if applicable.
In Portugal, there is no estate tax. However, Portuguese stamp duty of 10% may apply to Portuguese assets passed to beneficiaries other than spouses, descendants, and ascendants.
If there is no will upon a person's death, Portuguese intestate succession laws apply. This means the estate will be distributed among relatives in the order determined by law, subject to "forced heirship" rules.
While it may be useful to consult a lawyer from your home country, it is highly recommended to engage a Portuguese lawyer who specializes in estate planning due to the differences in law, especially relating to property and taxation.
Yes, estate planning can also involve powers of attorney, living wills, healthcare directives, and potentially off-shore structures for estate planning purposes, depending on your circumstances.
The Portuguese Justice Department provides helpful legal information. You may also consult Portugal's Bar Association for legal support. For non-residents, organizations such as AFPOP specialize in offering advice and support to foreigners living in Portugal.
If you need legal assistance in estate planning, the first step is to engage a local lawyer specializing in estate law. They can provide you with tailored advice and ensure your estate plans adhere to the applicable jurisdiction. They can also assist you in understanding tax implications to avoid any unforeseen liabilities for your heirs.
