International Succession Planning: How It Works for Brazilians

International succession planning means deciding, during your lifetime, who inherits what when assets, residence or heirs are in more than one country. For a Brazilian, the floor is Brazilian law: LINDB art. 10, a forced share of half the estate (Civil Code, art. 1,846), and probate of assets in Brazil in Brazilian courts (Code of Civil Procedure, art. 23).

Structures abroad complement that floor.

What is international succession planning?

It is the set of legal, tax and family decisions that defines how assets pass to heirs when elements of more than one country are involved: property or an account abroad, an heir who lives abroad, a family with dual nationality, a foreign partner. Planning starts with a map of assets and applicable laws, and only then chooses tools such as a will, a gift, a holding company, a trust or a foundation.

This guide treats planning as a process and covers the Brazilian legal floor. Two neighboring topics have their own articles: what the law says about succession with assets in several countries and the role of an offshore company in succession.

Which law applies to the succession of someone with assets in more than one country?

Under the LINDB (Brazil's Law of Introduction to the Rules of Brazilian Law), succession on death follows the law of the country where the deceased was domiciled, whatever the nature and location of the assets (art. 10, caput). But Brazilian courts are the only ones with jurisdiction over probate and division of assets located in Brazil, even if the deceased was a foreigner or lived abroad (Code of Civil Procedure (CPC), art. 23, II).

In practice, this means the domicile rule coexists with others:

• •Assets in Brazil: probate and division stay with Brazilian courts (CPC, art. 23, II).
• •Assets abroad: each country decides whether to apply the law of domicile, the law of nationality or the law of the place where the asset is located. This varies and must be confirmed with a local lawyer.
• •Lawsuit abroad: a case filed in a foreign court does not prevent Brazilian courts from hearing the same matter (CPC, art. 24).
• •Foreigner with assets in Brazil: Brazilian law governs the succession for the benefit of the Brazilian spouse or children when the personal law of the deceased is not more favorable to them (LINDB, art. 10, § 1).
• •Capacity to inherit: it is governed by the law of the heir's or legatee's domicile (LINDB, art. 10, § 2).

Because domicile weighs so heavily, a change of residence changes the picture. That is why the plan should be reviewed whenever the family moves to another country.

What does the Brazilian forced share limit in planning?

If the deceased has forced heirs (descendants, ascendants and spouse, Civil Code (CC), art. 1,845), half of the estate belongs to them by right, and it is called the legítima, or forced share (CC, art. 1,846). The testator may freely dispose of only the other half (CC, art. 1,789). When Brazilian law governs the succession, no structure ignores this limit without risk of challenge.

Three articles of the Civil Code help show where the boundaries are:

1. •Gift during life: a gift from an ascendant to a descendant, or from one spouse to the other, counts as an advance on what they are due by inheritance (CC, art. 544).
2. •Gift beyond the disposable share: a gift is void to the extent it exceeds what the donor could have disposed of by will at the time of the gift (CC, art. 549).
3. •Division during life: a division made by an ascendant, by an act between living persons or by last will, is valid as long as it does not harm the forced share (CC, art. 2,018).

That is why transferring everything to a structure abroad for the benefit of a single heir tends to generate litigation. Well-done planning designs the distribution with the forced share already counted in.

Which tools are part of international succession planning?

The most common tools are a will, a gift, a holding company, a trust and a private foundation. Each solves a different problem and carries its own point of attention in Brazil.

The choice depends on the makeup of the estate, where the heirs live and tolerance for costs and bureaucracy. No tool is better in the abstract. To compare options for your case, OffshoreProz's corporate structures and tax planning team can help build the map.

How does Law 14,754 treat a trust in a Brazilian's succession?

For income tax and for the purposes of the law itself, the assets of a trust abroad remain under the ownership of the settlor after the trust is created and pass to the beneficiary on distribution or on the settlor's death, whichever comes first (Law No. 14,754/2023 (Lei 14.754/2023), art. 10, I and II).

The central points of art. 10 are:

• •Nature of the transfer: the change of ownership is treated as a gratuitous transfer from the settlor to the beneficiary: a gift, if during life, or a transfer causa mortis, if it results from death (art. 10, § 2).
• •Income: it is considered earned by the owner of the assets and subject to individual income tax (IRPF) under the rules that apply to that owner (art. 10, § 3).
• •Controlled companies inside the trust: if the trust holds a controlled company abroad, it is considered directly held by the owner (art. 10, § 4).
• •Duties of the Brazilian: the settlor or beneficiary must request from the trustee the funds and information needed to pay the tax and meet obligations in Brazil, and the trustee's refusal does not remove the taxpayer's duty (art. 10, §§ 5 and 8).

Art. 12 defines trust, settlor, trustee and beneficiary, and art. 13 extends these rules to foreign contracts with similar characteristics. Anyone who already uses or plans to use a trust can read the guide on the VISTA Trust in the BVI and check the BVI jurisdiction with the support of a qualified professional.

How does ITCMD apply to an inheritance with assets abroad?

ITCMD is a state tax on transfers causa mortis and gifts of any assets or rights (Constitution, art. 155, I). On real estate, it falls to the State where the property is located. On movable assets, securities and credits, it falls to the State where the deceased was domiciled or where the donor is domiciled (art. 155, § 1, I and II, as worded by Constitutional Amendment 132/2023).

There are two points to watch when a foreign element exists:

• •Jurisdiction by complementary law: art. 155, § 1, III, leaves to complementary law the power to institute the tax when the donor is domiciled or resident abroad, or when the deceased owned assets, was resident or domiciled, or had probate processed abroad. Check whether a rule in force applies to your case before assuming the tax is or is not due.
• •Progressivity: Constitutional Amendment 132/2023 added § 1, VI, which requires the tax to be progressive according to the value of the share, legacy or gift. Maximum rates are set by the Senate (§ 1, IV), and effective rates depend on each State's law.

Inheritance taxes abroad follow the law of each country. Ask a tax lawyer to verify, case by case, whether a treaty or rule exists on offsetting against ITCMD.

How do you build an international succession plan, step by step?

Follow this order, because each stage depends on the previous one:

1. •Map assets, residences and heirs: where each asset is, in whose name, where each heir lives and what nationality each holds.
2. •Identify the law that applies to each asset: domicile of the deceased (LINDB, art. 10), Brazilian jurisdiction for assets in the country (CPC, art. 23) and local rules of the countries where there are assets.
3. •Calculate the forced share: separate the half that belongs to forced heirs from the disposable share (CC, arts. 1,789 and 1,846).
4. •Choose the tools: will, gift, holding company, trust or foundation, according to the table above.
5. •Consult a local lawyer in each relevant country: Brazil does not resolve what foreign law decides about assets outside the country.
6. •Meet the reporting obligations: the annual declaration of assets abroad and, where applicable, the Brazilian Capital Abroad report (CBE). The Central Bank publishes the current criteria and deadlines.
7. •Review with every change: new domicile, marriage, birth, sale of an asset or change in the law.

Does international succession planning avoid probate?

There is no way to promise that. Assets located in Brazil remain subject to probate and division in Brazilian courts (CPC, art. 23, II), and assets outside the country follow the rules of each place. Well-built structures can reduce conflict among heirs and make the transition more predictable, but the result depends on the applicable law, on how the structure was set up and on the documentation kept.

For Brazilian tax purposes, Law 14,754/2023 also does not treat the trust as a shield: ownership and tax are assigned under art. 10. Any proposal that guarantees "shielding" or "exemption from probate" without examining your case deserves suspicion.