Understanding Israeli Probate and Succession Law in Israel
Upon the death of an individual who left assets or property in Israel, the fate of their property must be decided according to succession law in Israel. Israeli probate and succession law is extremely complex and requires a highly experienced legal team to navigate through the bureaucracy. Did the person die “intestate” (without a will) or is there a will? Sometimes there can also be a trust or a codicil. It requires an expert to deal with the myriad of necessary legal details and get the heirs the inheritance to which they’re entitled.
Under Israeli succession law, if a person left property in Israel, the Israeli courts have jurisdiction over the distribution of that property to the legal heirs, whether or not those heirs are residents of Israel.
Inheritance law in Israel is governed by the Succession Law of 1965 ('Succession Law'). It is a very old and some say a very cumbersome law but it’s what we have and we have to live with it. The Israeli courts, known as the Probate Court or the Family Court, have jurisdiction over the estate of any person who at the time of his or her death was a resident of Israel, OR who left property in Israel.
The default presumption of Israeli inheritance law is stated in Section Number 1 of the Inheritance & Succession Law, which states that a man’s estate passes on to his heirs upon his death. This includes his fiscal assets, real estate, copyrights, etc.
How are Assets Bequeathed in the Israeli Registrar and Israeli Family Court?
Israeli law stipulates two ways to bequeath assets: by will or by law. If the deceased has left a will in Israel or in any other country, the inheritance will be distributed to the heirs as stipulated in the will. If the deceased hasn’t left a will, the heirs will be those stipulated by law, according to a clearly-designated order of inheritance.
The order of inheritance according to the Israeli law of succession for those who died intestate (without a will) specifies heirs in the following order of priority:
- The deceased’s spouse at the time of death. (Note: The surviving spouse is the only relationship mentioned here who isn’t related to the deceased by blood. This may include a common-law spouse);
- The deceased’s offspring, including illegitimate and adopted children and their offspring;
- The deceased’s parents, grandparents, and their offspring;
In the total absence of the aforementioned heirs, the State of Israel inherits the estate.
In the case of real estate, inheritance will be divided equally between the deceased’s spouse and the deceased’s children. In cases where the estate has non real estate assets like a bank account, stocks, or any other assets or chattels, the widow is entitled by Israeli law of succession to 100% of all non-real estate assets left by the deceased. These heirs take precedence over the parents of the deceased and their offspring, who in turn take precedence over the grandparents of the deceased.
The spouse will inherit the entire estate only if the deceased has NO children, siblings, or parents. Otherwise, the spouse is entitled to half the estate if the deceased is survived by children or parents, and to two-thirds of the estate if the deceased is survived by only grandparents, siblings, or other relatives. The spouse is also entitled to inherit the deceased’s movable property, including motor vehicles, which were part of the shared household.
It is important to note that Israeli assets belonging to the surviving spouse prior to their marriage are not part of the estate which is to be inherited. These may include up to half of the value of the couple’s assets, due to the operation of the Spouses (Property Relations) Law 5733 – 1973, the principles of joint ownership of property, or a property relations agreement such as a prenuptial agreement or “Prenup”.
The right to maintenance out of an estate is also accorded to the deceased’s children until the age of 18. The court may grant maintenance until a later age in some circumstances, and may also grant maintenance to parents of the deceased who are in need of financial support and were dependent on the deceased prior to his or her death.
According to section 6 of the Succession Law, an heir may withdraw from inheriting his or her part of the estate, but this may only be done if the estate has not yet been distributed.
Section 6 of the Inheritance law limits the right of withdrawal to an heir to ONLY three groups: siblings, spouse, or parents. So, for example, you cannot withdraw in favor of a nephew or a niece.
Beginning the Process of Inheriting Property in Israel When There is No Will.
In the case of inheritance in the absence of a will in Israel (“Intestate”) the distribution of the estate to the heirs according to the law begins with a petition for a Succession Order. This petition may be filed either at a branch of the Succession Registrar’s Bureau or to one of the rabbinical courts in Israel. It’s your choice. Most secular Israelis choose to use the bureau, most Orthodox Israelis choose to have issues like this decided by the rabbinical courts. For a deceased who was a non-resident of Israel but owned property here, the jurisdiction belongs to the Tel Aviv district court.
The succession petition is a valid judicial order under Israeli inheritance law. Like a court order or a decree, it does not suffer obsolescence and can be enforced years following its issuance. The court order does not specify the details of the distribution of assets among the heirs, but only decides upon the identity of the heirs and their respective inheritance rights and inheritance tax in Israel.
The petition for a succession decree must be accompanied by a large number of documents. Much of the required paperwork may now be E-filed online. This can save heirs valuable time, energy, and funds.
It is advised to consult a lawyer regarding the exact procedural requirements of the process of requesting an Israeli Succession Order. Where the petition for the order is made by an attorney on behalf of an interested party, it must be accompanied by a Power of Attorney who functions as your proxy and fiduciary.
The Succession Registrar or family court may nullify or amend a Succession Order (or a Probate Order, which is discussed in a separate article). If the order was granted by a court of law, only a court of law may annul or amend it. Any interested party may request to annul a Succession Order; this right is not limited to the heirs of the estate. One of the most common examples of annulment of a Succession Order is when after the order is given it is found that the deceased had in fact left a will. In such a case the Israeli Succession Order may be annulled and a probate order must be requested in respect of the will.
There is no estate/inheritance/death tax in Israel. However, some non-residents like those residents in the UK may have an estate tax in their domicile above the tax-free bracket of £325,000.
There is no Estate/inheritance Tax for clients from the United States. Residents in Canada, the UK, Europe, and the EU are advised to call us for the exact details. . Please contact us from the US or Canada at 888-923-0022 or in Israel at (972) 3.9055478 or (972) 50.7322688 to schedule a complimentary consultation to discuss your specific situation and how to navigate successfully through the entire probate and estate process.
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