In Estonia, there are no inheritance tax laws

However, income tax is applicable to gains from the transfer of property received as gift or inheritance

Some gains are tax-free, such as: commercial real estate

Gains from the sale of the primary residence of a taxpayer;

Profits from the transfer of a summer cottage or a garden house owned by the taxpayer over 2 years.


Thanks to Concordia's lawyers

In Estonia, what inheritance laws apply?

Heritage shall be governed by the law of the deceased's last country of residence.

Estonian Heritage Law, the Private International Law Act (PIL) and the Civil Procedure Code are the rules governing heritage (CCP). The EIL currently applies until 31 December 2008, and a new Legislation on Heritage will apply from 1 January 2009.

Foreign owners who are members of different religions, nationalities or non-Estonian foreigners shall not be treated differently in accordance with the law.

The heritage shall be governed by the law of the deceased's last country of residence. Accordingly, Estonian heritage law only affects the estate of a deceased whose last residence is Estonia. A person can make a disposition of the national laws of his/her citizenship in his/her own testament (or succession contract). Such a provision is not valid if, at the moment of death, the person is not a citizen of that state. If a foreigner has made this provision and the law of the foreigner provides that inheritance matters, the law concerned is the law of the country in which the property is located and the property is located in Estonia, then Estonian heritage law shall apply.

In the case of relocation (transmission from a foreign state to Estonia of heritage issues) the foreign state's rules of private international law shall apply. Where such rules prescribe the application of Estonian law (remission), Estonian substantive law rules shall apply. If the law of a third State is prescribed by foreign law, the transmission is not taken into account.

The Private International Law Act stipulates:

The types and effects of the wills;

Capacity for succession and indignity to succeed;

The scope of the succession;

The successors and their relationships;

Responsibility for the testator's debts.

Heritage proceedings are opened at the place of his last residence on the death declaration of the deceased. When a successor opens a succession, he has the right to succeed. According to the current EIL, a successor must accept the succession in order to succeed. The new EIL stipulates that succession shall be transferred to the successor at the start of the succession, but if the successor is not successful, he/she must renounce the right to succeed.

In accordance with the current EIL a notary can specify a term for the acceptance or waiver of an estate and may send a written notice or a notice thereof to a successor in the official Ametlikud Teadaanded publication. The term shall not be less than two months after the notice is received or published. Normally all successors are known and there are no disputes if everything takes place quickly, the heritage procedure lasts approximately 3 to 6 months. The legacy proceedings are concluded when a notary issues a successor or legatee a succession certificate. A succession cannot be accepted or renounced if the succession has passed ten years.

The new EIL stipulates a three-month waiver term. The term begins from the moment that the successor is aware (or should be aware) of the death and right of the deceased to succeed. A successor, a creditor of the deceased, a legatee or any other person with rights in relation to the estate shall submit a corresponding notarized application to a notary for the start of the succession process. A notary publishes in the official publication Ametlikud Teadaanded no later than two working days after start of the succession procedures a notice regarding the initiation of the succession proceedings. If a successor is unknown or no reliable information about the successor's place of residence is available, the notary publishes in Ametlikud Teadaanded an appeal for identification of a successor. The legacy proceedings are concluded if a notary issues a certificate of succession. The certificate shall be issued if sufficient evidence is provided as to the successor's right to succeed and to its extent, but only one month after the notice concerning initiation of succession proceedings has been published. There is every reason to believe that the heritage procedure under the new EIL takes no longer than the current EIL.

Inheritance issues under the Code of Civil Procedure (CCP) must be filed with the Court of General Jurisdiction upon death of an expert (e.g. the establishment of the right of succession, the claim for a successor against the owner of an estate, a lawsuit resulting from a legacy or an estate contract or a claim for a compulsory section or division of an estate). The CCP also regulates property management procedures. The Estonian court may, regardless of the State of which law applies to the estate of Estonia or of which state or jurisdiction is competent to conduct the succession procedure, apply management measures to a property of Estonia. Estate management measures are applied by the court at the place where the succession is opened. When a succession opens in a foreign country in Estonia, the estate may be located at the place of the estate by the court.

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