What are the national rules in case of intestate succession (no will has been set up)?

The rules of intestacy apply if there is no valid will and to any part of the estate not disposed of by will. No distinction is made between movable and immovable property.

The person entitled to succeed to the estate of a deceased person are divided into four classes:

• First class. This comprises the:
  • legitimate children of the deceased living at his death; and
  • descendants, living at the time of the death of the deceased’s legitimate children who died in his lifetime.

• Second class. This comprises the father, mother, brothers and sisters of the deceased. It makes a distinction between the:
  • heirs living at the time of the death of the deceased; and
  • descendants of brothers or sisters who died in the deceased’s lifetime.

• Third class. This comprises the ancestors (that is, grandparents and more remote lineal ancestors) of the deceased nearest in degree of kindred, living at the time of his death.
• Fourth class. This comprises the nearest relatives of the deceased living at the time of his death, up to the sixth degree of kindred (more remote relatives are excluded).

Distribution takes place after the deduction of the share of the surviving spouse (see below). The heirs of each class generally succeed equally. However, in the first and second classes the succession is per stirpes. This means that the heirs of the deceased inherit equally and the descendants of each heir inherit their parent’s share. In the third and fourth classes the succession is per capita. This means that all the heirs of those classes inherit equally. The persons of one class exclude persons of a subsequent class.

The estate of an individual who dies leaving no spouse and no relative within the sixth degree of kindred becomes property of the Republic of Cyprus.

The share of the net value of the estate (that is, after the debts and liabilities of the estate have been discharged) allocated to the surviving spouse varies according to the number and nature of other relatives surviving the deceased, as follows:

• Where the deceased has left a child or descendant of a child, the surviving spouse’s share is equal to the share of each child.
• Where the deceased has left no child or descendant, but has an ancestor or descendant of an ancestor within the third degree of kindred as set out in Schedule II of the Wills and Succession Law (Cap 195), the surviving spouse is entitled to 50% of the net estate.
• Where the deceased is survived by an ancestor or descendant of the fourth degree of kindred, but no closer relative, the surviving spouse’s share is 75% of the net estate.
• Where there is no surviving relative within the fourth degree of kindred or closer, the surviving spouse is entitled to the entire net estate.

When more than one lawful wife survives the deceased, the share given to the wife is divided equally between the wives.

Property that the surviving spouse has received from the deceased under a marriage contract is not taken into account in calculating the surviving spouse’s entitlement.

It is not possible for beneficiaries to challenge the adequacy of their provision under the intestacy rules.

What are the national forced heirship rules, if any existing?

Under Cyprus law, like in many other legal systems, part of the deceased person’s net estate (statutory portion) must be reserved for close relatives who are alive at the time of the deceased person’s death. Close relatives are the deceased person's:

• Spouse
• Children, or where the children died in the deceased’s lifetime, the descendants of those children. The proportion of the net estate taken up by the statutory portion varies according to which relatives survive:
• A living child or a descendant of a child: the statutory portion is 75% of the estate’s net value.
• A spouse or a parent, but not any children or their descendant: the statutory portion is 50% of the estate’s net value.
• No surviving spouse, parent, child or descendant of a child: the statutory portion is reduced to nil and al the estate can be disposed of by will.

Where the testator purports to dispose by will of a part of this estate in excess of the disposable portion, such disposable portion, such disposition shall be reduced and abated proportionally so as to be limited to the disposable portion.

The reduction and abatement provided for shall not apply where the testator disposes of up to the whole of his estate to his surviving spouse, provided that the leaves a spouse but no children or descendants of a child, or father or mother.

The statutory portion is paid in accordance with the intestacy rules to in paragraph 1 above.

It is easy to avoid the forced heirship provisions. Individuals who enter Cyprus to take up permanent residence can establish a Cyprus International Trust under the International Trusts Law before becoming resident in Cyprus. If a Cyprus International Trust is not an option (for example, because the individual is a permanent resident of Cyprus) a local trust should provide a way around the forced heirship provisions, although without a Cyprus International Trust’s tax benefits.

What are the national formal requirements when setting up a will (holographic will, will confirmed by witnesses, will confirmed by a notary public)?

Every person who is of sound mind, memory and understanding and who has completed the age of 18 may make a valid will thereby disposing of the whole or any part of the disposable portion of his estate.
A will must be writing and must be executed in the following manner:

• It must be signed at the foot or end thereof by the testator or some other person on his behalf, in his presence and by his direction;
• Such signature must be made or acknowledged by the testator in the presence of two or more witnesses present at the same time:
• Such witnesses must attest and must subscribe the will in the presence of the testator and in the presence of each other but no form of attestation will be necessary; And
• If the will consists of more than one sheet of paper each sheet must be signed or initialed by or on behalf of the testator and the witnesses.

Strict adherence to the formalities mentioned above is mandatory and must be complied with rigidly otherwise the will shall be rendered void.

Is inheritance and/or gift tax in place or abolished?

The Estate Duty (Amending) Law of 2000 abolished any form of succession tax in respect of deaths taking place on or after 1 January 2000.

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This information was compiled by George Liasides LLC.