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Feb 25, 2014

Inheritance tax and law


The Global Property Guide looks at inheritance from two angles: taxation, and what inheritance laws apply to foreigners leaving property in Kenya: what restrictions there are and whether making a will is advisable.

INHERITANCE


There is no inheritance or gift tax in Kenya.

INHERITANCE LAW



Kenya´s inheritance laws affect everyone who owns property in Kenya.

The Law of Succession Act and the Civil Procedure Act apply to all cases of intestate or testamentary succession in Kenya. The Kenyan Constitution guarantees that foreigners of different nationalities or religions are not treated differently to Kenyan citizens, and foreigners can legally inherit, buy, and sell property in Kenya.

The general principles of inheritance in Kenya are:

  • Succession to immovable property located in Kenya is regulated by the laws of Kenya, whatever the location or domicile of the owner at the time of death;
  • Succession to moveable assets is regulated by the law of the country of the domicile of the owner at the time of death.

Normally the applicable law is no different for spouses with different nationalities and/or religions, and the court in the locality where the immovable property is situated usually has jurisdiction to hear and determine proceedings regarding property rights; however, if the parties who own property are of the Islamic faith, then Islamic law is likely to apply, with proceedings before the Kadhis courts, which have jurisdiction in such cases.

Decisions related to the inheritance of property in Kenya owned by non-resident foreigners who are not of the Islamic faith are normally made by the Family and Probate Division of the High Court of Kenya. This court hears all proceedings relating to the estate of the deceased and follows the procedures and provisions of the Law of Succession Act. If the law of a foreigner’s nationality states that the applicable law for inheritance of immovable property located in Kenya is non-Kenyan law, then Kenyan law still takes precedence. This is because any decisions made by a foreign court must be registered with the High Court of Kenya for them to be enforceable in Kenya.

The process of granting probate can be long, especially if contested. It is mandatory to publish an application for probate in the Kenya Gazette for 30 days. The Grant of Probate or Letters of Administration Intestate can then be granted. If the immovable property of the deceased is to be sold, the Grant must be confirmed by filing a formal application to the High Court within six months; however, in exceptional cases, this period can be waived. Accordingly, the process to determine a probate case without any conflicting interests would ordinarily take about 7 to 9 months.


There is no reserved portion in Kenyan law.

In the case of intestacy, the Law of Succession Act sets out how the deceased´s property should devolve. A surviving spouse is entitled to the personal and household effects of the deceased, and a life interest in the whole residue of the net intestate estate; however, if the surviving spouse is a widow, and she re-marries, then her life interest is terminated. The surviving spouse has power to give all or any part of the capital of the net intestate estate to any surviving children of the deceased.

If only children are left, with no surviving spouse, then the estate devolves upon the children equally. If there are no children and no surviving spouse, the estate devolves upon the kindred, in the following order of priority: the father; or if dead, the mother; or if no parents, then brothers and sisters, and their children, in equal shares; or if none, then half-brothers and half-sisters and their children in equal shares; or if none, the relatives who are in the nearest degree of consanguinity up to and including the sixth degree, in equal shares. Failing survival of any kindred, the estate devolves upon the State.


It is advisable for foreigners to make a will.

Most people in Kenya do not make a will, even though the law permits. It is of practical importance for any foreigner owning property in Kenya to make a will, because a will makes it is easier for the High Court to deal with the disposal of property, particularly for beneficiaries who may not necessarily live in Kenya.

In the case of intestacy, all beneficiaries are required to sign consents to the High Court approving the application, but this may be a long and complicated process if many beneficiaries are scattered in different countries. The procedural requirements in the High Court are less tedious if a will is in place. Only the named executors are required to sign the application. A will also avoids any potential conflicts between the beneficiaries.

It is relatively simple to make a will in Kenya. The testator must sign the will in the presence of two witnesses, who will in turn attest the testator´s signature. Each of the witnesses must sign the will in the presence of the testator. A foreigner does not have to be in Kenya to make a will. It can be done through a lawyer.


Property can be given during the lifetime of the owner.

An owner can freely give property in Kenya to anyone prior to his/her death, with few legal restrictions.


Kenyan law determines ownership of property.

The courts always apply Kenyan law to determine the ownership of property in Kenya. If issues arise concerning who owns property, or how property is distributed between spouses, then Kenyan law looks primarily at the names on the Title Deeds. Matters relating to where the marriage of spouses took place, or where the partners live, are not considered.


Property can be inherited by minors.

If property might be inherited by a child, or children who are not of a legal age, then a guardian should be appointed in the will to manage their affairs. The maker of the will has a free hand to appoint a suitable guardian.

  





Comments

#1 CAZ | April 07, 2010

Hi,
M father has recently died and has left no will. He has property in Kenya and is married. Could you please tell me what the Kenyan laws are on Intestacy in relation to what rights a daughter has on his property. My fathers wife has been married 9 times before and has only been married to him for 1 year. He has died leaving no will and i would like to know what rights to his estate i have as his only child. I do hope that you can help me with this situation.

Kind regards

caz

#2 SHEILA | May 19, 2010

My dad passed away in 2008, he left two wifes and 8 children. Although he didnt have a will, he left property and shares worth 3 million kenyan shillings. All his properties are in my late mum's name, and now my step mums want to divide the 3 million among themselves. Although we are all above 18 yrs, is there a way us the children can receive part of the inheritance?
Sheila, US

#3 SMELTER | April 04, 2012

my father bought land while married to my mum. However he married a second wife agemate of my first sister and we have been living in a polygamous family. We from my mum are 9, 5 sons and 4 daughters. The other family has 8, 3 boys 5 girls. The only issue is that dad never took us to school and we had to struggle through meagre savings of my mum.We are well educated now but my dad has systematically sidelined us. Now he wants to share out the land between the wives and the younger one has been farming twice bigger than ours. What does the law of succession in Kenya say in such a situation. What can we do so that we are not shortchanged?

#4 JOSEPH FREDRICK | December 06, 2012

hi i used to live with my father at kitale kenya and he owned 25 acre of landand a house,when he died at the year 2000 i went to live abroad with my mother cause i was young at that time.and he has another son and a daughter whom are born from another women,so now its my brother who is running and living on the farm,so do i have the right to ask,sale part of my share.

#5 GEOOFFREY | July 12, 2013

1. hey,joseph fredrick my concern goes to you i want to inform you that the law of succession section 29 states that the children of deceased whether mantained by him or not maintained before tjhe deceased immediately prior to his death together with the wife or former wife/wives has the dependant rights 2.SHEILA hey okey for you section 26 of law of succssion act cap 160 laws of kenya states that a court will interfer with the deceased will for his disinherited wife and children and if no will the court will apply the act to divide the property as long as you are a child of the deceased you are entitled to inherent 3.SMELTER FOR you the 2nd wife will only get the lann equally as yourb mum and all kinds are entitled to equal share

#6 KIPLAGAT SILAS KOECH | May 19, 2014

Hi,my name is Silas. My dad passed the year 2005 just two years after my mum had passed leaving 4 of my siblings and i at a very akward position. He left assets plus some amount in the bank which i want to follow up. My big quiz is,how will i be able to acquire his account and he did not write any will? What are the procedures to be followed concerning such an issue? Please help! Thanks

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