till death do us part ... (or not)

What happens when spouses die at the same time or shortly after each other? Do they inherit from each other? And what about inheritance tax, is it due twice? This is not only an issue for spouses but also for other family members who stand to inherit from each other like parents and children, or siblings.

Simultaneous death

We speak about simultaneous death when two people die and it is not clear who died first. This can happen in plane crashes, road accidents, fire, shipwrecks or other tragedies.

Depending on the chronology of the deaths, the devolution of the estate may be radically different. If a married couple dies in a road accident and the husband leaves a brother as his only relative while his wife leaves an aunt.

• If the husband is deemed to have died first, his wife inherits, as she takes precedence over the husband's brother. If she dies as well, her aunt is entitled to inherit her estate and incidentally that of her husband.
  
  
• If the wife is deemed to have died first, the devolution of the estate is entirely different. The husband inherits from his wife and, as a result, his brother receives the couple’s entire estate.
  
  
• If, however, husband and wife are deemed to have died at the same time, neither of them inherits from the other, so that the succession is divided between the husband's brother and the wife's aunt.

The principle is that to be able to inherit, one must survive the deceased.

However, if it is not known who died first and who lived longest, then the solution under Roman law was that simultaneous death was presumed as a general rule, but if parents and children perished together, the parents were presumed to have died before puberes (sexually mature children) but after impuberes.

The French code civil provided for similar but different rules for the death of parents based on age and sex: those under 15 or over 60 were deemed to have died first and men were deemed to have outlived women, etc …

commorientes

In 2001, France adopted the rule of the ‘commorientes’. If they are to inherit from each other and they died in the same event, they are deemed to have died at the same time.

Belgium got there much earlier, in fact together with the Netherlands and Luxembourg (the 1972 Benelux Agreement on commorientes). Since 1977, the law says that commorientes are deemed to have died at the same time (article 4:5 of the New Civil Code).

As explained above, if they die at the same time, they cannot inherit from each other, but their heirs will. This has important consequences for settling the estate and for the inheritance tax to be paid (see below). The inheritance is settled and distributed as if other deceased did not exist. The estates will then revert in full to the other heirs of the deceased.

Sometimes, the order of death can be established.

In the past, the courts have accepted statements of eyewitnesses, the poorer health in case of suffocation, the fact that one could swim, the nature and the severity of the wounds, or, if they have the same wounds, the position of the bodies. If one can identify the person who died first, then the person who lived longer will inherit from the other who died before him. How long he or she survived is irrelevant. He or she in turn passes the inheritance on to their own heirs, even if they were not able to accept the inheritance. It is then up to the heirs of the person who died last to decide whether they accept or waive the share of the estate of the person who died first as it is inherited by the person who died last. If the heirs do not agree, this share shall be accepted under benefit of inventory.

When a husband dies in a car accident while his wife dies in the ambulance, on the way to hospital, we are not talking about commorientes. The heirs of the spouse who lived the longest - even if only for a short time - (the wife) can claim the entire estate, including the estate of the husband.

The husband's estate is settled first, so that the wife can inherit part of it (in full ownership or in usufruct, depending on the matrimonial property regime, any clauses in their marriage contract or in a will). Then the wife's heirs inherit, including any property she has inherited from her husband's estate.

Not all countries have the same rules.

Austria, Belgium, France, Germany, Italie, Luxembourg the Netherlands and Spain have all adopted the position that commorientes cannot inherit from each other.

In the UK, the commorientes rule, however, is a presumption of survivorship in regard to claims to property : the younger shall be deemed to have survived the elder. Furthermore, many wills have a survivorship clause stating that beneficiaries named in the will cannot inherit unless they live for a specific amount of time after the will-maker dies. This survivorship period commonly ranges from five to sixty days.

In the US, the Uniform Probate Code and the Uniform Simultaneous Death Act allow probate courts to resolve distribution of inheritances in one probate proceeding rather than two if the two individuals pass within 120 hours of one another. However, not all States have adopted the Uniform Probate Code or the Uniform Simultaneous Death Act.

This can cause problems when the succession of the commorientes is governed by different laws.

Article 13 of the Hague Convention on the Law applicable to succession to the estates of deceased persons gives a solution : they do not inherit from each other. A few countries have signed the Convention, but none have ratified it.

The EU Succession Regulation (EU) No 650/2012 had more success. The regulation states as a rule that the habitual residence of the deceased determines the law applicable to the succession (article 21) but it allows a person to opt for the law of the State whose nationality he possesses to govern his estate as a whole (article 22). As a result, a couple with different nationalities may have different laws applying to their estate.

Article 32 copied the text of the Hague Convention and states that

Where two or more persons whose successions are governed by different laws die in circumstances in which it is uncertain in what order their deaths occurred, and where those laws provide differently for that situation or make no provision for it at all, none of the deceased persons shall have any rights to the succession of the other or others.

This rule applies in all Member States of the European Union (with the exception of Denmark and Ireland who opted out of the EU Succession Regulation) even if the deceased had opted for a national law that is the law of a State that is not part of the EU.

If a British husband and a French wife die simultaneously, Belgium will apply the rule and decide that they do not inherit from each other. However, if the estate includes any assets in the UK, the presumption of survivorship will prevail, and a younger wife will inherit from the husband.

Inheritance tax

Inheritance tax is due when one person inherits from another.

If one of the commorientes inherits from the other, inheritance tax will, in principle, be due twice. However, if they do not inherit from each other, inheritance tax will only be due once.

one inheritance instead of two
means less inheritance tax

If a spouse dies, the surviving spouse inherits usufruct of the estate of the deceased. The value of the property is then taxed on the basis of a value split between the surviving spouse and the children. When the surviving spouse dies, the usufruct extinguishes, and the children automatically become full owners.

However, if the surviving spouse dies within six months, the usufruct is disregarded when calculating the inheritance tax on the estate of the first deceased (article 67 Inheritance Tax Code). The children will pay (more) inheritance tax as if they had immediately inherited the full ownership of the property. This also applies to annuities or pensions.

Spouses may include specific clauses in their marriage contract, e.g. to leave all community property to each other. If so, the surviving spouse will pay inheritance tax on the community property he or she receives. And when the surviving spouse dies, the children will inherit and pay inheritance tax again.

This double taxation can be mitigated. If the same property is inherited again within a year, the heirs can deduct from the inheritance tax due upon the second death half of the inheritance tax, but not more than the inheritance tax on the first death.

If the couple have children from a previous marriage, the question has potentially more important consequences, from a civil and a tax point of view. Take the example of a couple where the husband has children from a previous relationship. If they have a matrimonial property regime of community property, and

• The husband dies first, his children inherit, the wife holds half of the family assets and has a usufruct over her husband’s half. Everyone pays inheritance tax on the share they receive unless the wife dies within 6 months of her husband’s death. The children become full owners of their half, the other half is inherited by the wife’s family.
  
  
• The wife dies first, her husband is entitled to the full community property. He pays inheritance tax on half the community property. When he dies everything goes to his children.
  
  
• If they die at the same time, the husband’s children inherit half of the couple's wealth and the wife’s family inherit the other half.

In situations like this, the order of death is very important and some planning may help.