Inheritance law in Switzerland: What is there to consider to when inheriting property?

Parentelic system of succession and the right to a compulsory portion – the basis of inheritance law in Switzerland

The parentelic system of succession in Switzerland regulates the succession of all heirs except spouses. They are classified as primary heirs. In this process, heirs from an anterior parentel exclude levels from subsequent parenteles. The closer an heir is to the deceased, the higher their parentela level. As a result, the children of the deceased belong to the first parentela. If they are already deceased, the grandchildren take their place of inheritance. If there are no descendants, the parentelic system goes up the family tree. In the second parentela, the parents of the deceased or their descendants inherit. Should these heirs no longer live, the third parentela uses the grandparents and their descendants as heirs.

Wills in Switzerland’s inheritance law, now and in the future

The Swiss law on succession leaves the deceased as much free hand as possible to shape their will. The will can be drawn up as a public disposition or as an independent disposition. The contract of inheritance must be in the form of a public document in order to be valid. Again, the compulsory portion to which the heirs are entitled by law must be taken into account. It should be noted that the testator's freedom to make a will is restricted by the right to a compulsory portion.

Estate regulation without a will: How inheritance law is regulated in Switzerland

Under Swiss inheritance law, the following persons are entitled to a compulsory portion: the descendants and the parents of the testator, if there are no descendants, and the surviving spouse or registered partner.

Only in a few cases can heirs be disinherited according to the right to a compulsory portion. This includes the voluntary renunciation of an heir or even a community of heirs. In cases of hardship, a determination of debarment from succession suspends the compulsory portion of the estate. For this reason, properties in estates require special attention. In the absence of a will or an inheritance contract, the heirs shall receive by court order equivalent lots of the total property according to their respective inheritance share.

If the value of the property is too high to be awarded in a lot, a sale is unavoidable. The deceased can avoid this by issuing rules for the division of the estate. In this case, an heir or a designated community of heirs inherits the property.

Tax and inheritance law in Switzerland with regard to transferring property while still alive

An alternative to inheritance is transferring property while the bequeather is still alive. This offers various possibilities, such as complete or mixed gifts, for example linked to taking over a mortgage. In order to prevent the other heirs from retrospectively applying for a reduction of the estate, a legal and tax examination is required in each individual case. Each canton in Switzerland autonomously determines the gift and inheritance taxes, meaning regional differences can be serious. An inheritance contract is also suitable to make a possible renunciation of inheritance legally binding. The reasons for some heirs to renounce their inheritance may include:

• ​For heirs to be financially compensated while the bequeather still lives

• The heir taking on debts for the property

• Temporary renunciation of the estate until the death of the spouse

• To obtain a property by avoiding division or sale

• Heirs have no interest in a property abroad

Special features of the inheritance of property under Swiss law

The heirs do not always want to use the property themselves or cannot because the spouse has a right to live there. With several heirs it is therefore often difficult to decide who should inherit the family house. Often there is no interest in property in the estate because the heirs already own property. In these cases, the aim is to know the current market value of the properties and to make a decision on a possible sale on the basis of this. As a renowned estate agent with expertise, we are happy to make a non-binding property valuation in Switzerland.

In addition, we can help you sell or rent out the property from the estate. As a property company that operates internationally, we can advise you as an heir or community of heirs just as comprehensively on the special features of inheritance law in Switzerland if the estate contains property abroad.

We have developed this guide with the support of the law firm Bär & Karrer AG, a leading expert in property transactions and estate planning in Switzerland.