A Guide to International Estate Planning for Cross Border Families

Written by Hannah Stacey

The most recent data shows that 281 million people (about 3.6% of the world’s population) live outside their country of birth, a number that has steadily increased over the past five decades and will most likely be on a continuing upwards trajectory.[1]

This results in international estate planning becoming an integral aspect of global wealth management. Whether you’re an expat building a life abroad, a foreign national investing in the United States, or part of a family with multiple citizenships and residences, planning for the transfer of assets across borders has become a strategic necessity.

Cross‑border families now face increasingly complex challenges, ranging from conflicting inheritance laws, unexpected tax exposure, and the risk that assets may be distributed in ways that contradict personal wishes. Below we will explore the core concepts of international trust and estate planning, how cross‑border inheritance laws work, and explore tools like offshore trusts that can help protect global wealth for the next generation.

Why International Estate Planning Matters More Than Ever

Global mobility has created a new class of families whose lives don’t fit neatly within one legal system. You might live in the UK, hold a US passport, own property in Portugal, and have children studying in Singapore. Each of those jurisdictions has its own rules governing inheritance, taxation, and succession.

Without suitable cross‑border estate planning, there are a multitude of unwelcome situations that families may encounter:

• Double or triple taxation on the same assets;
• Exposure to estate tax for non‑residents;
• Forced heirship rules that override your Will;
• Delays in probate across multiple countries;
• Conflicts between civil‑law and common‑law systems

International estate planning ensures that your wealth is transferred efficiently, privately, and according to your wishes – no matter where your assets or beneficiaries are situated.

Key Challenges in Cross‑Border Estate Planning

1. Tax Exposure in Multiple Jurisdictions

Taxation is one of the most complex aspects of international estate planning. Countries may tax:

• Worldwide assets
• Assets located within their borders
• Transfers to heirs
• Transfers from foreign nationals

This is especially relevant for individuals who own US assets, because US estate tax for foreigners applies to US situs assets even if the owner is not a US citizen or resident.

2. Probate in Multiple Countries

If you own property in more than one jurisdiction, your estate may need to go through probate in each country. This can lead to delays, legal fees and potentially conflicting court decisions.

Proper planning can streamline or even avoid probate entirely.

3. Conflicting Inheritance Laws

Many countries (especially in Europe, the Middle East, and parts of Asia) apply forced heirship rules. These laws dictate how much of your estate must pass to certain relatives, regardless of what your Will says.

For example:

• France and Spain reserve a portion of the estate for children.
• Many Middle Eastern jurisdictions apply Sharia‑based inheritance rules.
• Common‑law countries like the US and UK allow more freedom of disposition.

1. Understanding Estate Tax for Non‑Residents

US Estate Tax for Foreigners

Unlike almost every other country, the US estate tax rules are based on domicile, not residence. This means for US citizens and other individuals deemed domiciliary resident, regardless of where you live, all of your worldwide assets will be included in the US taxable estate. This includes US real estate, shares of US corporations and tangible property located in the US, even when non-US resident. We have seen that this can come as a surprise for long‑term expats who assume that moving abroad changes their US tax exposure.

The exemption for non‑US domiciliary residents who hold US situs assets at death is only $60,000, compared to $15 million for US persons.

Other Countries With Estate or Inheritance Taxes

• UK: Inheritance tax on worldwide assets for long-term residents
• Japan: One of the highest inheritance tax rates globally
• Spain: Regional inheritance taxes vary widely
• France: Strict forced heirship and inheritance tax rules

Cross‑border families must understand how each jurisdiction taxes global wealth transfer to avoid unnecessary erosion of the estate.

Offshore Trusts and Other Planning Tools

One of the most effective strategies in international trust and estate planning is the use of offshore trusts. These structures can help families:

• Avoid probate
• Reduce exposure to estate and inheritance taxes
• Provide long‑term control over wealth distribution
• Protect assets from political or economic instability
• Navigate forced heirship rules

How Offshore Trusts Work

An offshore trust is established in a jurisdiction with favourable trust laws – such as Jersey, Guernsey, the Cayman Islands, or Singapore. The trust holds assets on behalf of beneficiaries, and because the trust (not the individual) owns the assets, they may fall outside the scope of certain inheritance laws or taxes.

Benefits for Cross‑Border Families

• Privacy: Trusts avoid public probate proceedings.
• Flexibility: Trusts can be tailored to multiple jurisdictions.
• Continuity: Assets remain protected even if family members relocate.
• Tax efficiency: Properly structured trusts can reduce exposure to estate tax for non‑residents.

However, trusts must be carefully designed to comply with reporting rules such as FATCA, CRS, and local tax laws.

Estate Planning for Expats: What to Consider

Expats often assume that their home‑country Will covers everything. In reality, living abroad introduces new legal and tax considerations.

1. Do you need multiple Wills?

Some expats benefit from having a Will in their country of residence and a separate Will for assets in their home country. An additional consideration may be appropriate for those in a civil‑law jurisdiction.

These must be coordinated to avoid accidental revocation.

2. Which country is your “Domicile”?

Domicile affects:

• Inheritance tax exposure
• Applicable succession laws
• Probate jurisdiction

It’s not the same as residency or citizenship, and it can be surprisingly convoluted.

3. Are your beneficiary designations valid abroad?

Retirement accounts, insurance policies, and investment accounts may not recognise foreign beneficiary designations.

4. Do you have a Power of Attorney that works internationally?

Many countries do not accept foreign POAs, which can complicate incapacity planning.

2. Global Wealth Transfer: Planning for the Next Generation

As wealth becomes increasingly international, families must think beyond traditional Wills. Effective global wealth transfer strategies may include:

• International trusts
• Family Investment Companies (FICs)
• Family Limited Partnerships (FLPs)
• Foundations
• Cross‑border gifting strategies
• Life insurance for liquidity in high‑tax jurisdictions
• Pre‑immigration tax planning

The goal is to preserve wealth, minimise tax exposure, and ensure smooth transitions across generations and borders.

Practical Steps to Start Your International Estate Plan

1. Map your global footprint

The first step is outlining the following:

• All countries where you hold assets
• All countries where you have citizenship or residency
• Where your beneficiaries live or may settle in the future
• Where you may retire

This determines which laws apply.

2. Review your existing documents

Check whether your current Will, trust, or POA is valid in each relevant jurisdiction.

3. Understand your tax exposure

Work with advisors who specialise in:

• Estate tax for non‑residents
• US estate tax for foreigners
• Local inheritance tax rules

4. Consider trust structures

Offshore or onshore trusts may provide tax efficiency, asset protection, and continuity.

5. Coordinate with local and international advisors

Cross‑border planning requires collaboration between:

• Estate planning attorneys
• Tax advisors
• Financial planners
• Trust companies

At MASECO, we often collaborate with other like-minded professionals in the legal and tax services space to help our clients get the whole picture in order to ensure they receive a complete and coordinated approach to their estate planning objectives.

Final thoughts

International estate planning is complex, but it’s also one of the most powerful tools available to protect global wealth.

For so many of our clients who have cross‑border family needs, who are expats and international investors, a well‑structured plan ensures that assets are preserved, taxes are minimised, and your wishes are honoured across jurisdictions.

By understanding cross‑border inheritance laws, leveraging offshore trusts, and planning proactively for global wealth transfer, you can create a family legacy that extends across borders and supports your future generations.

Risk Warnings

• All investments involve risk and may lose value. The value of your investment can go down depending upon market conditions and you may not get back the original amount invested.
• Your capital is always at risk.

Tax Warnings

• MASECO Private Wealth is not a tax specialist. This article does not take into account the specific goals or requirements of individuals and is not intended to be, nor should be construed as, investment or tax advice. You should carefully consider the suitability of any strategies along with your financial situation prior to making any decisions on an appropriate strategy.  Information about potential tax benefits, including the levels, bases of and reliefs, from taxation is based on our understanding of current tax law and practice and may be subject to change. We strongly recommend that every client seeks their own tax advice prior to acting on any of the tax mitigation opportunities described in this article. The tax treatment depends on the individual circumstances of each individual and may be subject to change in the future.

[1] Interactive World Migration Report 2024