Dealing with the estate of a deceased loved one is a sensitive issue, requiring expert care and confidentiality. It involves complex administrative tasks that are far from straightforward, underscoring the importance of seeking legal counsel and, ideally, appointing an attorney to oversee the legal aspects.
Initiating the Process – Key Considerations
The initial step in this process involves determining whether the deceased had a valid will or died intestate (without a will). This distinction is crucial as it dictates the legal procedure to follow: a “Probate Procedure” if a will exists or an “Estate Administration” in its absence.
This distinction also influences how the deceased’s estate will be distributed. In a probate scenario, the estate is allocated according to the decedent’s wishes as outlined in their last will. Conversely, in an administration situation, the estate is divided among rightful heirs in accordance with their legal entitlements under the Wills and Succession Law Cap 195.
It’s important to note that Law Cap 195 is pertinent not just in cases of intestacy. The law sets out specific criteria for determining the legality and validity of a will and enforces certain rules regarding mandatory inheritances that should be considered when executing a will.
Submitting an Application to the Court
When a will is present, the testator typically names an individual to act as the estate’s Executor. This person is responsible for initiating the probate process and carrying out the testator’s wishes. The Executor must file a Probate Application in court to be legally recognized and appointed.
In the absence of a will, all legitimate heirs must unanimously agree on and consent to the appointment of an estate Administrator. This individual then files for an estate administration process in court to obtain “letters of Administration” via a court order, thereby becoming the estate’s Administrator.
Asset Inventory
Both the Executor and Administrator are required to thoroughly investigate and document the deceased’s assets at the time of death. This is a legal necessity, as they must submit an Asset Inventory to the court, accompanied by an affidavit affirming full disclosure of the deceased’s assets.
Tax Clearance Certificate
Upon initiating either probate or administration proceedings, the Executor/Administrator must notify the Inland Revenue Department. This triggers a review to ascertain any taxes owed by the deceased. The department’s initial inquiry involves determining the decedent’s tax residency status, either in Cyprus or abroad.
For a tax resident in Cyprus, the department may require filing of Income Tax Declarations for a period of 3 to 6 years prior to the date of death. For those tax resident in another country, a Certificate of Fiscal Residence from the relevant authority is requested for the same period.
Following this, the Inland Revenue Department issues a final Tax Clearance Certificate for the estate and separate certificates for each asset owned by the deceased at the time of death.
Distributing the Estate and Filing Final Accounts in Court
After obtaining the necessary tax clearances, the Executor/Administrator can distribute the estate to the Will’s beneficiaries or the rightful heirs. Prior to distribution, all debts, expenses, and fees related to the deceased and the estate must be settled, provided the estate funds are sufficient. If not, the Executor/Administrator may need to liquidate assets or take other measures to cover these liabilities.
Distribution commences only after these obligations are met. The final step involves filing detailed Final Accounts with the court. These accounts, subject to the Court Registrar’s approval, must include signed confirmations from all beneficiaries acknowledging receipt of their inheritance. The procedure concludes once the Court Registrar verifies that all legal requirements have been fulfilled.
Conclusion
Given the complexity and strict legalities involved, this procedure necessitates professional handling by someone well-versed in the law, and capable of liaising effectively with the Inland Revenue Department and the Court Registrar to ensure a smooth and efficient process.