Estates of deceased and probate court
THE HERITAGE IN DENMARK
Danish inheritance law is governed by the law of succession, the Danish “arveloven”, and was extensively reformed in the law of 2007. In addition to the legal inheritance, the law also pro-vides how to regulate the estate during lifetime, taking into account mandatory provisions for the protection of the descendants, the so-called “livsarvinger” and the surviving spouse.
- The legal succession
According to Danish law, the rule of succession order exists, which means that the legal heirs are divided into different orders with regard to succession.
Each of these orders represents a rank and excludes the following order. The direct ancestors and descendants of the testator form a direct line, the sideline consists of ancestors and de-scendants, who are not from each other but have a common ancestor.
In the event that the children or the sisters-in-law, who are first to be appointed by succession, can not or will not inherit the inheritance, their descendants automatically replace them. This is called a representation rule.
Since 1938, illegitimate children have been treated as children born during the marriage. This also applies to children who were adopted after 1.1.1973.
A child conceived but not yet born at the time of the death of the testator is then able to be inherited if he is born alive.
For legal succession are called:
1st order: marital, extramarital and adopted after 1973 children and their descendants
2nd order: father and mother, siblings and their descendants
3rd order: other ancestors than father and mother
4th order: the sidelines, except for the siblings up to and including the sixth degree and their offspring.
- The spouse’s right
Under Danish law, the surviving spouse has the right to “uskiftet bo”, which means that the surviving spouse can live in undistributed estate.
“Uskiftet bo” is a special Danish rule, which means that the surviving spouse can keep the entire estate free of charge, subject to the following conditions:
1. the longest living was married with the deceased
2. the matrimonial property regime is the community of property (the legal matrimonial property regime in Denmark, unless otherwise agreed)
3. the couple had children together
When the surviving spouse dies, the children inherit both the part of the first-deceased’s property and the part of the last-deceased’s property.
The following is important to emphasize: The so-called “undisclosed estate” is the right of the long-term survivor to dispose of the deceased’s property if the above three conditions are met.
The children can claim their share of the first-degree inheritance only if the long-term person commits “abuse” of property, which means in practice that the surviving spouse can use the first-deceased’s property to suit the circumstances – to live a “normal life”, but not use the property f.eks. to give extraordianry gifts, play at the casino and so on.
Was the couple married, but had it as a matrimonial property separation, then the survivor must share the estate with the children. If no will has been established, the surviving spouse will inherit half of the deceased person’s assets if the deceased had children. If the deceased did not have children, the long-term survivor inherits the entire estate. If the deceased has children form a previous marrage, the surviving spouse may live with the common children in the undistributed estate, but must share the estate with the deceased’s children form the first marriage, unless they consent to the surviving spouse to live in the ”uskiftet bo” estate If the surviving spouse remarries, he or she has to undergo a division of the assets with the children.
The spouse is a heir by law. This means that a restriction of the right of inheritance can only be made to half of the statutory inheritance, ie to 1/4 of the estate of the testator.
If the value of the testator’s estate is less than DKK 100,000 (approximately 13,500 EU), the surviving spouse will take over all assets, regardless of whether the deceased had children or not.
- The inheritance of the offspring
The succession of descendants depends on whether the testator was married or not and to what extent the deceased had the property regime of the community of property in marriage.
If the deceased is unmarried and has not established a will, the children of the deceased inherit his property in equal parts.
If one of the children dies, his children inherit his inheritance.
Children are compulsory heirs, meaning their inheritance rights can only be limited to half of the legal inheritance.
The amount of compulsory portion of the children depends on the number of children. For one child, the compulsory portion is ¼ of the assets, for two children 1/8, and so on.
- The inheritance of the ancestors and the sideline
Only if there are no direct descendants of the testator, are the ancestors, i.e. father and mother, entitled to inherit. If these, as well as siblings of the deceased and their descendants, are missing, ancestors other than father and mother are entitled to inherit. Finally, other members of the sibling sibling and their descendants are potential heirs.
If the mother and the father of the childless testator live, then they share the inheritance. If there is only one surviving parent, it will inherit
the entire heritage. If both parents are dead, the siblings of the deceased will inherit. If the siblings are also dead, their children will inherit.
Cousins and cousins are not legal heirs.
If there are no legal heirs and the deceased has not established a will, the state will inherit.
- The will
Danish law distinguishes three forms of the will:
- The notarial will:
This will has to be signed and authenticated before a notary. This testament is the surest and its evidential value can be overridden only by judicial determination of a forgery.
The will will be recorded in the Danish Central Register and will automatically be used if the testa-tor dies.
- The wittnes will:
This will has to be signed before at least two witnesses. The witnesses must be of legal age and they must not be relatives of the testator. The probative value of the testament testified is not as strong as that of the notarized will, and the heirs may challenge it (for example, by claiming that the witnesses are biased).
- The emergency will:
It is handwritten, dated and signed by the testator himself, and is valid only if the testator was in distress or in a emergecy situation. However, if the deceased does not die, he must, within 3 months, have a new will, e.g. a notary will.
A will written by several persons, tipically a married couple, which provides for their mutual appointment as heirs, is possible under Danish law and is widely used.
- The acquisition of inheritance rights.
In Denmark, the appointment of a heir is required for the effectiveness of the death transfer. There is an official probate procedure. When the testator dies, the heirs are summoned to the probate court, the Danish “skifteretten”.
Responsible is the probate court, in whose district the deceased had his last main residence. There, a possible present will is opened and the heirs are informed about the death of the testator and their status as heirs.
If all heirs are of age, if there is agreement on the distribution of the inheritance and if it is ensured that no further heirs exist, the probate tribunal leaves the inheritance to the heirs for distribution in accordance with the applicable distribution key.
From then on the heirs can freely dispose of their respective share of the estate. If one of the conditions is not met (minor heirs, disagreement in the distribution, existence of further heirs within 30 days), the estate will be transferred to a probate administrator, normally a lawyer appointet by the Court.. The court also transfers the estate to a probate administrator if the testator decrees that the inheritance should be shared by a lawyer (executor testamenti). Every heir, whether by law or by will, has the right to choose whether he wishes to inherit or reject the inheritance. The acceptance of the inheritance is absolutely irrevocable and applies retrospectively from the death of the testator. With the acceptance of the inheritance, the heir is considered the universal successor of the law and is liable indefinitely, therefore also with his personal fortune for the liabilities of the estate.
If someone has left a legacy (for example, a painting), that person is only a legatee and not a heir, i. not a legal successor, and therefore has no liability obligations. If the Legate is no longer present in the estate, he receives nothing.
A possibly unknown heir can assert his or her inheritance claim within 5 years, after which the claim becomes statute barred. Within the 5 years he has full claims against the known heirs.
- Disputes in inheritance matters
For inheritance disputes, the Probate Court is responsible in the district of the deceased’s last princi-pal place of residence. The last principal place of residence is determined by objective criteria (habitual residence, domicile of the family, place of financial interests, place of principal occupation) and intentions of the deceased.
If the deceased owned real estate, then the court in the district of the location of the real estate is responsible. If the property is located abroad, the heirs have the option of carrying out the procedure in Denmark or abroad. However, if the last principal residence of the testator was in Denmark, the inheritance will always be shared under Danish law, regardless of the country in which the property is located.
- The competence of the probate court
As already mentioned, Danish inheritance law determines that the estate is to be treated at the place of last residence of the deceased, which need not necessarily be identical to the place of death of the deceased. This provision therefore applies to all those who have recently resided in Denmark, irrespective of their nationality, and irrespective of whether the estate consists of movable property or real estate. According to Danish inheritance law the “dødsboskifteloven” § 2, the competence of the Danish probate court “skfiteretten” also exists whenever the testator was not domiciled in Denmark on condition that: 1) the deceased owns the Danish citizenship “indfødsret” or has another special way of belonging to Denmark and leaves assets which are not taken into account in the estate treatment abroad. or 2) the deceased left assets in Denmark, which are not taken into account in estate treatment abroad.
- Tax aspects
The amount of inheritance taxes payable by the estate (the estate is a legal entity) depends on who the heir is.
Spouses pay 0%
Children and their descendants pay 15%
Others: pay 15% and beyond, 25% of the balance, a total of 25%.
According to Danish law, a distinction is made between inheritance tax “arveskat” and inheritance tax “boafgift”. Inheritance fee is the fee that must be paid if the assets are transferred to the heirs. The obligation to pay inheritance fee is independent of the obligation to pay inheritance tax.
According to the “Boafgiftsloven” discount tax, a 15% inheritance fee is payable if the estate ex-ceeds DKK 260,000 (2015 value approx. EUR 35,000).
In addition, an additional fee of 25% is payable if the inheritance does not fall to the spouse and / or descendants.
An estate must pay inheritance tax if the value of the estate exceeds DKK 2,500,000 (value of 2015 approx. EUR 335,000) and the value of net assets exceeds DKK 1,900,000 (value of 2015, approx. EUR 255,000).