United Arab Emirates - the latest "tax haven" to sign up to enhanced tax transparency
On Tuesday 31st October, the UAE government introduced a new law (Law No. 15 of 2017) which officially recognises that non-Muslims with assets in Dubai can register a Will in English under ‘internationally recognised common law’.
Without a Will, on death, assets in Dubai pass under Sharia law. A surviving wife who has children receives one eighth of her deceased husband’s estate. A surviving husband who has children qualifies for one quarter of his deceased wife’s estate. The remainder of the estate is distributed among other family members. In the past, expats have found that the deceased's assets are automatically frozen (cars/joint bank accounts / businesses and property) and that the unravelling of the deceased's estate can take months, usually years.
The creation of the Dubai International Finance Centre Wills and Probate Registry (DIFC WPR) in May 2015 has enabled non-Muslims to register an English Will in Dubai to govern the succession of Dubai assets free of the constraints of Sharia law. Relatively few Wills have been exposed to the Dubai Courts and it is not yet entirely clear whether such Wills are being upheld on death by the local courts or whether the grants of administration produced by the DIFC Courts would be recognised by the banks and central land registry.
There are currently three ways non-Muslims can make a Will to deal with assets in Dubai:
The new law gives recognition to DIFC Wills. It also suggests a plan to create a Wills Registry within the Dubai Courts akin to the existing DIFC WPR. In due course, it seems the Dubai Courts will directly recognise the testamentary freedom of non-Muslims. The finer details of the formal requirements of such Wills are as yet unknown.
Some might be put off by the cost involved in registering a Will with the DIFC (currently AED 15,000 for the registration of mirror Wills) however as things stand they appear to offer the greatest certainty.
For the time being at least, a DIFC compliant Will works best and Jim Sawer, a partner in the Kingsley Napley Private Client team, is one of only two UK based lawyers recognised by the DIFC WPR to make them.
Jim Sawer, a partner in our private client team, is authorised by the DIFC to draft Wills for Dubai residents in respect of their Dubai assets.
As part of our growing international services, we offer support to British expats living in Dubai and elsewhere in the UAE. A number of partners at Kingsley Napley frequently travel to Dubai to support clients and meet with experts and professional advisors.
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