Can their plan work?

0
Q.

My partner and I reside in Mallorca. We are both residents. I started a Death Benefit Policy with her as beneficiary some years ago. My teenage daughters live in South Africa with their mother. They will move to Europe and study at universities when they finish school. They both have Netherlands passports as I have. My partner has a German passport. The insurance policy will pay out a substantial amount on my death. What is your opinion of the following plan? My partner could purchase two apartments in the names of my daughters to avoid inheritance tax on them when she herself dies. She would establish an usufruct enabling her to rent out the flats until she dies. After that my daughters will be in full possession of them. Can we do this?                                                                                                                                                                                                                                                                                               B L (Baleares)


A.

Yes, you can do it. It might be a good idea for you and your partner to register in Mallorca as a ‘pareja de hecho,’ which is a common-law couple and gives you many husband and wife benefits, such as lower inheritance tax. You need a good lawyer to see you through this.

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