Chile vs Canada will

Chilean Chit-Chat
1

Hi forumites

I was told that upon death in Chile, family automatically inherits the property. What if there is no will in Chile and only a will in Canada that specifies the property to someone ofher than family?

What if you want to create a Chile will specifically for the Chilean property… can it be left to someone other than family (all in Canada)?

If there is no will in Chile and only a will in Canada does that create problems for the inheritors?

2

Yeah the law is strict on this. First spouse; if no spouse, your children and then their kids if your children are no longer around; then parents if no kids; if none of the above are around which are “mandatory heirs”, then the next tier of heirs comes into to play of uncles, aunts, cousins BUT this tier can be bypassed by doing a Chile will. There is also a percentage split with the initial eligible mandatory heir receiving 50%, then 25% to I believe another eligible heir of your choice which can be the initial eligible mandatory heir again and 25% to whoever. So it can get kind of confusing and a Chile will helps clarify these things but can never go against Chile law.

Same with the Canada will, cannot go against the Chile mandatory heir system.

Of course not legal advice, use a trusted Chile lawyer used to dealing with resident foreigners and this specialty area, probably won’t be cheap but worth it depending on your personal situation.

1 Like
3

in Chile, the person can bequeath the entirety of their assets to a non-family member, provided that there are no forced heirs (legitimarios) with the legal right to receive a portion of the inheritance.

Here is the breakdown of the situation under Chilean succession law:

  1. Forced Bequests (Forced Heirs/Legitimarios): The Chilean system does not grant absolute freedom to write a will, as there is a portion of the inheritance (the legitimate half and the fourth of improvements) that must legally go to the “legitimarios” (forced heirs).
  • The legitimarios are: Descendants (children, grandchildren), Ascendants (parents, grandparents), and the Surviving Spouse/Civil Partner (Conviviente Civil).
  1. Fourth of Free Disposal (Cuarta de Libre Disposición): The testator always has the right to freely dispose of a part of their assets, known as the Fourth of Free Disposal (the 25% of the total inheritance), in favor of any person, related or not, or any institution.
  2. The Case in Question (No Direct Family in Chile, but Abroad):
  • Chilean law considers forced heirs regardless of whether they reside in Chile or abroad.
  • If the person does not have descendants, ascendants, or a surviving spouse/civil partner (who are the only forced heirs), then they have no legitimarios to whom they must reserve a portion of the inheritance.
  • In the absence of legitimarios, the testator regains full freedom to dispose of all their assets (100% of the inheritance) through a will.
  • Therefore, the person can name a friend, a partner (if they are not civil partners), an institution, or any third party as the universal heir in their will.
  1. If there were NO Will (Intestate Succession): If the person were to die without a will (intestate succession), the inheritance would pass to their relatives in the order established by law (siblings, collateral relatives up to the sixth degree), and in the absence of all of them, the inheritance passes to the Chilean Treasury (Fisco de Chile). A will is precisely used to prevent the Treasury from inheriting and to ensure the assets go to the desired person.

Conclusion: If the person has no spouse/civil partner, no children, and no parents (ascendants), they can make a valid will in Chile bequeathing 100% of their assets to any person or entity they wish. Distant relatives (siblings, nephews/nieces, uncles/aunts, cousins) are not forced heirs and would only inherit if no will existed.

1 Like
4

By the way, the best to avoid taxes, lawyer fees and long tramits in court (the execution of the will it may take 1 year or more) is to “sell” while living to the intended heir with an “usufructo” contract, the procedure is as follow:
To transfer a property to someone else’s name while reserving a usufruct, a donation with reservation of usufruct must be made before a notary, the corresponding taxes must be paid, and then the donation must be registered in the Property Registry. In this process, the new owner receives the bare ownership (nuda propiedad), while the donor retains the right to use and enjoy the home.

Detailed steps:

Go to a Notary: This is the first step to formalize the operation. The notary will draft the public deed of donation, which will detail all the data of the usufructuary (who will have the right to use the property), the bare owner (nudo propietario) (who receives the property in exchange), and the property. If the usufruct is granted with the condition that the person who transfers the property enjoys it until their death, a life usufruct (usufructo vitalicio) will be constituted.

Pay the Corresponding Taxes: This step is mandatory and must be carried out after the signing of the deed. The taxes to be paid will depend on local legislation, but generally include the Donation Tax (Impuesto sobre Donaciones) and the Transfer Tax (Impuesto sobre Transmisiones Patrimoniales).

Register the Deed in the Property Registry: Once the taxes have been paid, it is necessary to register the public deed so that the changes are officially recorded and the donation is public. The registration in the Property Registry will state the new ownership, that is, who has the usufruct and who has the bare ownership.

1 Like
5

Someone in my Chilean family has done this.

For hlf2888, this may the best option to insure a designated non-mandatory heir gets the property when you die while having the right to live on it and do what you want on it before you pass.

2 Likes
6

I think the same, time ago I received an inhetitance and it took me one year and lot of expenses to receive it, I would have avoided all those mess with a good contract before the die

7

Thank you eeuu and tom, that makes a bit more sense.