Inheritance tax and law
April 02, 2012
The Global Property Guide looks at inheritance from two angles: taxation, and what inheritance laws apply to foreigners leaving property in Saint Kitts & Nevis: what restrictions there are and whether making a will is advisable.
How high is income tax on residents in Saint Kitts & Nevis?
There are no inheritance and gift taxes in St. Kitts and Nevis.
Thanks to MITCHAM & BENJAMIN, Barristers-at-Law
What inheritance laws apply in Saint Kitts & Nevis?
The laws of St. Kitts & Nevis affect everyone who owns property in the country
Inheritance is governed by the Wills Act (Chapter 84 of the Revised Laws of St. Christopher & Nevis). If a person dies without leaving a will, the property is governed by the Intestates Estates Act (Chapter 36 of the Revised Laws of St. Christopher & Nevis.)
No distinction is made between foreigners of different nationalities or religions, or between foreigners who reside locally, and those who live abroad. The general principle is that the law of the place where the property is situated is applicable.
Issues in relation to property which are too complex for the High Court Registrar, are heard by a High Court Judge in the Supreme Court. If there are no delays by any party, such matters can be completed within a year. Judgments obtained in the United Kingdom, and other British Commonwealth countries, may be registered and executed in St. Kitts & Nevis. Specific action must be brought in the local courts to enforce other foreign judgments. If there are no legal rules in relation to a specific legal issue or formality, the rules and forms used for probate in the High Court of England apply, as far as possible.
There is a reserved portion only when the deceased fails to make a will.
If a person dies intestate, a reserved portion applies. All of the deceased's personal property passes to the surviving spouse. Out of the remainder of the deceased's property, the surviving spouse will receive the sum of EC$5,000 (approx. US$2,000) or a sum equal to 10% of the net value of the estate, whichever is greater. All of the deceased's established debts and testamentary expenses must be paid from the estate.
In the case of intestacy, if there are no children, a life interest in the estate passes to the spouse; but if there are children, the spouse receives a life interest in half of the property, and the other half is given to the children in equal shares. All children, whether born inside or outside marriage, qualify for inheritance. After the spouse and children, the law lists the line of inheritance from parents to brothers and sisters, grand-parents, aunts and uncles, the spouse, and in the absence of relatives, to the government.
The will can be made in any country
Wherever it is made, the will should conform to the requirements of the local law. If executed in St. Kitts & Nevis, the simultaneous presence of the maker and two witnesses is required.
In order to avoid probate, some foreign nationals hold land in a corporation. However, since death taxes were abolished, making a will is fairly common in St Kitts & Nevis. It is advisable to make a will if the intention is to dispose of property in a different manner to that proposed by intestate law. If there is no will, the spouse, after receiving the reserved portion, only inherits a life interest initially, but can only inherit absolutely, after several other relatives of the deceased, but before the government.
Property can be transferred during the lifetime of a legal owner
The owner of the title document is regarded in law as the legal owner. The law also looks behind the title, and recognizes equitable ownership, for example, in the case of a spouse, contributing partner, or mortgagee.
A licence is required for the transfer of property
Foreign nationals must apply through a local attorney for an Aliens Land Holding Licence to purchase or own property in St. Kitts & Nevis. (An application form can be seen at http://www.mitchamandbenjamin.com/ under Forms).
If an unlicenced foreign national acquires property in St. Kitts & Nevis as a gift, or under a will, or on intestacy, that person must by law obtain a licence, or sell the property, within one year. Failing to do so could result in the property being forfeited to the government. An inheritor may be granted further extensions of time beyond the one year, if considered reasonable.
If a matrimonial home is purchased in the name of one spouse during marriage, it is the practice of the court on divorce to award half to the spouse whose name is not included on the title. In the case of foreign nationals, the applicable matrimonial law is normally that of the country where the parties are domiciled. To avoid any presumptions of law, spouses are free to draw up whatever agreement they wish in relation to their property.
A guardian can be appointed for a child
Where property is inherited by a child or a person not legally adult, a guardian can be appointed in a will, or by the court. Preference is usually given to a parent as guardian, although the court can appoint some other suitable person.