Revision Of Swiss Inheritance Law Allowing More Flexibility In Estate Planning

• Published date: 12 December 2022
• Subject Matter: Family and Matrimonial, Wills/ Intestacy/ Estate Planning
• Law Firm: Rajah & Tann
• Author: Mr Vikna Rajah and Alexandra Geiger

Introduction

On 1 January 2023, the first part of the revised Swiss inheritance law will come into force with the following key far-fechting changes for all individuals:

1. Reduction of reserved portion for descendants and abolishment of reserved portion for parents;
2. Increased entitlement for spouse with usufruct;
3. Abolishment of forced heirship in pending divorce proceedings;
4. Prohibition of gifts after conclusion of inheritance contract and
5. Further clarifications on disputed legal questions.

This Update provides an overview of these changes.

Key Changes

Reduction of Reserved Portion for Descendants and Abolishment of Reserved Portion for Parents

The most important modification of the revised law concerns the forced heirship rules. Forced heirship rules of disposition and succession stipulate that upon death of a person, a part of his/her testamentary estate must pass to his/her forced heirs, such as his/her descendants and spouse ("reserved portion"). The new law reduces the reserved portion of descendants from ' to ' of their legal share of the testamentary estate, and abolishes the reserved portions for parents (previously ' of their legal share). The reserved portion for the surviving spouse/registered partner, however, will remain unchanged at ' of their legal share.

In other words, if a person is survived by a spouse and descendants, an increased ' of his/her estate (and no longer 3/8 only) may be freely disposed of. The same disposable quota applies if a person is survived by descendants only (previously only '). If, on the other hand, a person is survived by a spouse/registered partner and the parents, 5/8 of the estate may be freely disposed of. Hence, the disposable quota amounts to at least ' of the estate in any case and the testator is free to bequeath ' of the estate to any chosen heir or legatee at his/her own discretion.

The revised provisions will not only apply to all successions after 1 January 2023 but also to existing last wills and inheritance contracts. Therefore, a review of existing succession and inheritance documents is recommended in order to ensure compliance with the revised law.

Increased Entitlement for Spouse with Usufruct

Under the current law, spouses with common descendants may bequeath a maximum of ' of the estate to the surviving spouse as an heir and the rest of ' of the estate (which goes to the common descendants) to the surviving spouse as a usufruct (as a beneficiary). As a result of the modifications of the forced...