Own property in Portugal? Why succession planning matters

The answer is not always simple. When a foreign national owns real estate in Portugal but lives in another country, has heirs abroad, is married under a foreign legal system, has children from previous relationships or has already made a will in their country of origin, the succession process may become more complex, more time-consuming and more exposed to family disputes. And that is why making a will in Portugal may be highly advisable for foreign property owners.

Can a will in Portugal help?

A will allows the property owner’s wishes regarding their assets to be expressed clearly and in a legally structured manner. In the case of foreign nationals owning property in Portugal, this can be especially important, as the succession may involve the laws of different countries, documents issued abroad, translations, legalizations, tax rules, notarial procedures and land registry formalities. Without proper planning, heirs may face uncertainty about which law applies, who is entitled to the property, which documents are required, how to register ownership in Portugal or how to sell the inherited property in the future.

A will prepared in Portugal, in coordination with the owner’s international situation, can help avoid many of these problems. It can identify Portuguese assets more precisely, indicate who should receive them, reduce doubts regarding the owner’s wishes and facilitate procedures before notaries, the Portuguese Tax Authority and the Land Registry Office.

In certain situations, a will may also serve another important purpose: allowing the testator to choose the national law that should govern the succession, where legally admissible. This may be particularly relevant for foreign citizens living in Portugal, or for those who own assets both in Portugal and in other countries. The purpose is to ensure that the owner’s wishes are effective and compatible with the applicable law.

But…Be careful with legal instruments used abroad

It is also important to bear in mind that not all legal instruments used in other jurisdictions have a direct equivalent under Portuguese law. Structures commonly used in common law systems, such as trusts, do not exist in Portugal in the same terms and may raise legal qualification issues when the estate includes Portuguese real estate. For this reason, succession solutions designed abroad should be carefully reviewed before assuming that they will produce the same effects in Portugal as they do in the country of origin.

Many foreign property owners assume that they can freely leave their Portuguese property to anyone they choose: a spouse, partner, children, friends, nephews, nieces, godchildren or institutions. In some cases, this may be possible, in others, there may be significant legal limits. If Portuguese law applies to the succession, certain heirs are specially protected, such as the spouse, descendants or, in some cases, ascendants. These heirs may be entitled to a reserved portion of the estate, which cannot be freely excluded by will. Therefore, before deciding who should inherit a property located in Portugal, it is essential to understand which law applies, who the protected heirs are, how much freedom the owner has to dispose of the estate and whether any previous wills should be respected, coordinated or reviewed.

This coordination is particularly important when a will has already been made in another country. That will may be valid and relevant, but it may not always be sufficient to avoid practical difficulties in Portugal. It may be necessary to translate documents, obtain apostilles or legalizations, interpret clauses in light of the applicable law or confirm whether the foreign will clearly covers the Portuguese property.

On the other hand, if a new will is made in Portugal, it is essential to ensure that it does not accidentally revoke a previous will made abroad. In many cases, the most appropriate solution may be a Portuguese will limited to assets located in Portugal, properly coordinated with the existing succession planning in another country.

When is a Portuguese will especially advisable?

Preparing a will may be especially advisable when the foreign property owner owns real estate in Portugal but lives abroad, resides in Portugal while retaining foreign nationality, has children from a previous relationship, is married for the second time, lives with an unmarried partner, wishes to benefit someone who is not a direct heir, or owns assets located in more than one jurisdiction.

These situations are common among foreign nationals who purchase property in Portugal. They are also the situations in which lack of planning may generate greater uncertainty, higher costs and a higher risk of conflict between family members or beneficiaries.

It is also important to emphasize that succession planning is not only for large estates. Even where the only relevant asset in Portugal is a house, an apartment or a plot of land, it may be essential to define in advance what should happen to that property. Without proper guidance, heirs may have to deal with lengthy procedures, foreign documents, family disagreements, additional costs and difficulties in registering the inherited property. A well-prepared will can simplify this process and help prevent the transfer of the property from becoming a problem for the people the owner intended to protect.

How legal advice can support this process?

Our team, in LACA (Lamares, Capela & Associados), advises foreign clients who own, or intend to acquire, property in Portugal and who wish to plan the transfer of those assets in a clear, secure and legally effective manner. This assistance includes analyzing the client’s family and asset situation, identifying relevant succession risks, coordinating with wills already made abroad, defining the intended testamentary instructions and liaising with the notary responsible for formalizing the will in Portugal.

A lawyer does not replace the notary who formalizes the will. The lawyer’s role is to legally prepare the process, discuss possible solutions with the client, anticipate potential issues, clarify the intended effects and ensure that the wishes to be communicated to the notary have been properly considered and aligned with the client’s international situation. Each case must be assessed individually. Nationality, habitual residence, marital status, children, matrimonial property regime, previous wills and the location of the assets may significantly affect the most appropriate solution.

Making a will is not only about preparing for the future but also protecting the owner’s wishes, their assets and the people they intend to benefit. If you own property in Portugal and want to ensure that it passes according to your wishes, proper legal advice can help avoid uncertainty, delays and disputes.

Lamares, Capela & Associados assists foreign clients with the legal preparation of wills and succession planning involving assets located in Portugal, with a personalized and solution-oriented approach.