Luxembourg inheritance law, in plain terms

Who inherits?

Without a will, the law designates heirs in a fixed order. Descendants come first; failing that, parents and siblings; then other ascendants and collateral relatives. The surviving spouse has a particular status.

The children

They inherit in equal shares. A child who died before the parent is represented by their own children.

The surviving spouse

Where there are children, the spouse can generally choose between usufruct of the family home and its furnishings, or a share in full ownership equal to a child's share, with a minimum of one quarter of the estate. This choice has lasting consequences: it largely determines whether the property can be sold.

The registered partner

A declared partnership does not confer the same inheritance rights as marriage. Without a will, protection is markedly weaker. This point surprises many families.

Parents and siblings

They inherit where there are no descendants, under rules dividing the estate between the paternal and maternal lines.

The reserved share

Children cannot simply be disinherited. A fraction of the estate is reserved for them; the rest, known as the disposable portion, can be allocated by will or gift.

• One child: half the estate is reserved.
• Two children: two thirds.
• Three or more children: three quarters.
• Lifetime gifts are brought back into the calculation: a child who has already received property does not start from zero.

Accepting or renouncing

Inheriting means receiving the assets but also the debts. There are three options, and the choice deserves thought where there are debts or a property that is hard to sell.

Unconditional acceptance

You receive everything, debts included, potentially beyond the value inherited. Careful: dealing with the deceased's property often amounts to tacit acceptance.

Acceptance up to the net assets

You are liable for debts only up to what you receive. The procedure is formal and requires an inventory.

Renunciation

You are treated as never having inherited. Your share passes to the other heirs or to your descendants. Renunciation is made by formal declaration.

Careful. Do not clear the home or sell anything before your position is clear: certain acts can be read as acceptance of the estate.

The notary's role

As soon as real estate forms part of the estate, the notary is unavoidable. They draw up the deed of inheritance proving your status as heir, search the register of wills, take the inventory and draft the deeds of division or sale.

• Heirs freely choose their notary; a single notary can act for everyone.
• The deed of inheritance is the document banks, insurers and buyers will ask for.
• The notary arranges the transcription of ownership into the heirs' names.

The inheritance declaration

A declaration must be filed with the registration and estates administration (AED). It lists assets and liabilities as at the date of death, including the value of any real estate.

• Death occurring in Luxembourg: the usual deadline is six months.
• Death elsewhere in Europe: twelve months. Outside Europe: twenty-four months.
• Late filing exposes you to interest and penalties: flag any foreseeable delay.
• The value used for the property becomes the reference point, notably for calculating a capital gain on a later sale. A well-supported valuation protects your interests.

Inheritance tax

Luxembourg is comparatively lenient in the direct line. What passes to children under the legal devolution is in principle exempt, as is the share going to a surviving spouse where the couple had children together.

• Direct line (children, parents): exemption in principle on the legal share.
• Siblings, uncles, nephews: progressive taxation according to the degree of kinship.
• Unrelated persons: the burden is considerably higher.
• Surcharges apply to large shares.
• Anything above the legal share, by will or gift, can become taxable again even in the direct line.

Cross-border situations

Cross-border workers, foreign residents in Luxembourg, property in Belgium, France or Germany: this is the most common case in the Grand Duchy, and the most technical.

• The European succession regulation in principle designates the law of the deceased's last habitual residence.
• The deceased could have chosen the law of their nationality by will. Check this first.
• The European Certificate of Succession allows an heir to prove their status in other member states.
• Property located abroad remains subject to the tax and formal rules of the country where it sits.
• Two notaries, one in each country, are often needed. Allow time.