Cyprus: Cyprus Succession Law And Planning

This article appeared in the September 2007 issue of "Offshore Investment" and is reproduced by kind permission of the publisher.

Cyprus’s succession law reflects the cosmopolitan nature of the island itself. While the wording of the law and many of its provisions are unmistakably English, Cyprus succession law also enshrines the concept of forced heirship, usually associated with civil law and Islamic countries, and recognises the rights of widows of polygamous marriages. This article provides an outline of the law and the forced heirship provisions and suggests planning techniques that can be used to avoid any restriction on testamentary freedom.

The Key Legislation

Cyprus succession law is incorporated in a number of enactments, the most significant of which are the Wills and Succession Law (Cap 195), and the Administration of Estates Law (Cap 189). Both laws date back to the first half of the 20th century, when Cyprus was a British colony, which explains some of the rather old-fashioned language they contain.

These laws apply to anyone who dies domiciled in Cyprus. Domicile is a general legal concept, distinct from nationality or residence. Broadly speaking, a person’s domicile is the place he or she thinks of as their permanent home.

The Wills and Succession Law deals with both Wills and Intestacy. The part of the law dealing with Wills is based on the English Wills Act of 1837, whereas the part dealing with intestacy is based on the Italian Civil Code and reflects continental law.

The Concept Of Forced Heirship

In contrast to its English counterpart, the Wills and Succession Law does not allow testators to dispose freely of their property by will. A substantial part of the deceased person’s net estate (that is, the value after allowing for payment of debts and funeral expenses) must be reserved for close relatives (the deceased person’s spouse, children and descendants of children of the deceased who died in his or her lifetime) who are alive at the time of his or her death. This reserved amount is called the "statutory portion" and is distributed according to the rules set out in the Wills and Succession Law. The remaining amount of the net estate (the "disposable portion") may be disposed of by Will.

A Will that purports to dispose of more than the disposable portion of the testator’s estate is not invalid but the disposition in the Will will be reduced and abated proportionally so as to be limited to the disposable portion. No abatement will take place if the testator leaves a surviving spouse but no children or descendants of children, and leaves more than the disposable portion, up to the value of his estate, to the surviving spouse.

Section 42 of the Wills and Succession Law provides that there is no statutory portion for anyone who was born, or whose father was born, in the United Kingdom or most Commonwealth countries. Such individuals are entitled to dispose of all their property by Will.

Other non-Cypriots are free to dispose only of moveable property without any statutory portion. Accordingly, these "forced heirship" provisions require careful consideration and appropriate action ahead of death to avoid any undesired results.

How Forced Heirship Works

Calculation Of The Statutory Portion

The actual proportion of the net estate taken up by the statutory portion varies according to which relatives survive the deceased person.

  • For example, if an individual dies leaving a living child or a descendant of a child, the statutory portion amounts to three quarters of the net value of the estate.
  • If the individual is survived by a spouse or a parent, but not by any children or their descendants, the statutory portion is half the value of the net estate.
  • If the individual leaves no surviving spouse, parent, child or descendant of a child, the statutory portion is reduced to nil and all the estate may be disposed of by will.

The statutory portion is divided according to the rules set out in the Wills and Succession Law, which also apply in the absence of a valid will or to any part of the estate not otherwise disposed of.

Categories Of Relatives Entitled To The Statutory Portion

These are divided into four classes, as follows:

  1. The first class comprises the children of the deceased who are living at the date of his or her death, together with the surviving descendants of any of the deceased’s children who died in his or her lifetime;
  2. The second class comprises the parents of the deceased (or if the parents are dead, the nearest living ancestor) and the brothers and sisters (including half-brothers and half-sisters) of the deceased, together with the surviving descendants of brothers or sisters (including half-brothers and halfsisters) who died in the deceased’s lifetime;
  3. The third class comprises the nearest ancestors of the deceased living at the time of his or her death; and
  4. The fourth class comprises the nearest other relatives of the deceased living at the time of his or her death, up to the sixth degree of kindred (more remote relatives are excluded).

The persons of one class exclude persons of a subsequent class. Accordingly, if the deceased person is survived by a child and a brother, the statutory portion of the estate goes exclusively to the child.

Distribution Of The Statutory Portion

Within each class there are specific rules for the share taken by an individual class member:

  • Living children of the deceased are all entitled to an equal share and descendants of a deceased child are entitled to that child’s share per stirpes.
  • Surviving parents, brothers and sisters (including half-brothers or half-sisters) of the deceased are all entitled to an equal share. Descendants of brothers and sisters who died in the lifetime of the deceased are entitled to the share of the brother or sister concerned, per stirpes.

  • If there are ancestors of equal degree of kindred on both the mother’s and the father’s side of the family, the statutory portion and undisposed portion is divided into two. Each side of the family is entitled to its half share, and each individual takes an equal percentage of his or her side’s share.
  • If there are two or more members of the fourth class, each receives an equal share.
  • If the deceased person has no surviving spouse and no living relative within the sixth degree of kindred, the statutory portion and undisposed portion become the property of the government.

The Surviving Spouse

Where the deceased leaves a surviving spouse, a prior share must be set aside for him or her in arriving at the statutory portion. This share varies according to the number and closeness of relations entitled to the statutory portion.

  • If the deceased leaves children (or descendants of children of the deceased who died in his or her lifetime), the statutory portion and undisposed portion is divided equally among the surviving spouse, the living children and the descendants of children who died in the lifetime of the deceased, per stirpes.
  • If the deceased leaves no child (or descendant of a child), but at least one relative of the third degree of kindred (great grandparent, aunt, uncle, nephew or niece) or closer, the surviving spouse is entitled to half the statutory portion and undisposed portion.
  • If the deceased leaves only relatives of the fourth degree of kindred (great great grandparent, great aunt, great uncle, first cousin, grand nephew or grand niece), the surviving spouse is entitled to three quarters of the statutory portion and undisposed portion.
  • If the deceased leaves no relative within the fourth degree of kindred, the surviving spouse is entitled to the entire statutory portion and undisposed portion.

If the deceased left more than one lawful wife, the surviving spouse’s share is divided equally among them.

Retaining Testamentary Freedom

As noted earlier, the forced heirship provisions do not affect the estate of anyone who was born, or whose father was born, in the United Kingdom or most Commonwealth countries.

For others, any undesired effects of the "forced heirship" provisions can be relatively easily circumvented. In the case of individuals coming to take up permanent residence in Cyprus (and ultimately acquiring a Cyprus domicile of choice), the simplest and most effective option is to establish a Cyprus International Trust under the International Trusts Law of 1992 prior to becoming resident in Cyprus. The International Trusts Law specifically provides that any transfer or disposition made to a Cyprus International Trust will not be affected in any way by the inheritance law of the Republic of Cyprus or of any other country, and that the validity of such transfer shall not be challenged. This is reinforced by Section 1 of the 1976 Convention on the Recognition and Enforcement of Foreign Judgements in Civil and Commercial Matters, which has been ratified by Cyprus, and which provides that the Convention does not apply to decisions relating to the capacity of persons or questions of family law, including personal or financial rights and obligations between parents and children or between spouses and questions of succession.

The Cyprus International Trust also has powerful tax planning and asset protection benefits. It is exempt from taxation and transfers of assets into the trust cannot be set aside unless it is proved to the satisfaction of the court that the transfer was made with intent to defraud persons who were creditors of the settlor at the time the transfer was made. The burden of proof lies with the creditor and no action may be commenced after two years from the date of the transfer.

Costs of establishing and maintaining a Cyprus International Trust are modest and the formalities involved in setting up a trust are not onerous. International Trusts have other benefits – for example, the International Trusts Law provides that the income and gains of an international trust derived from sources outside Cyprus are exempt from all kinds of tax in Cyprus.

If a Cyprus International Trust is not an option (for example because the settlor is a permanent resident of Cyprus), a local trust should provide a way around the forced heirship provisions, though without the tax benefits of a Cyprus International Trust. Specialist legal advice, taking into account the individual’s entire circumstances, is essential to determine the best way forward.

In Conclusion

Cyprus offers an excellent quality of life to incoming residents and the island is becoming increasingly cosmopolitan. While Britain continues to be the single largest source of new residents, the Russian-speaking population is substantial and the island is truly cosmopolitan. In addition to its general low-tax regime, Cyprus has further attractions in the form of low taxation of pensions and absence of succession taxes in any form. While the forced heirship provisions of the succession law may be a trap for the unwary, proper planning can avert any undesired consequences. What is more, the succession planning structure of choice, the Cyprus international trust, brings with it significant side-benefits in terms of asset protection and tax planning opportunities.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on

Click to Login as an existing user or Register so you can print this article.

Some comments from our readers…
“The articles are extremely timely and highly applicable”
“I often find critical information not available elsewhere”
“As in-house counsel, Mondaq’s service is of great value”

Related Topics
Related Articles
Related Video
Up-coming Events Search
Font Size:
Mondaq on Twitter
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
Email Address
Company Name
Confirm Password
Mondaq Topics -- Select your Interests
 Law Performance
 Law Practice
 Media & IT
 Real Estate
 Wealth Mgt
Asia Pacific
European Union
Latin America
Middle East
United States
Worldwide Updates
Registration (you must scroll down to set your data preferences)

Mondaq Ltd requires you to register and provide information that personally identifies you, including your content preferences, for three primary purposes (full details of Mondaq’s use of your personal data can be found in our Privacy and Cookies Notice):

  • To allow you to personalize the Mondaq websites you are visiting to show content ("Content") relevant to your interests.
  • To enable features such as password reminder, news alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our content providers ("Contributors") who contribute Content for free for your use.

Mondaq hopes that our registered users will support us in maintaining our free to view business model by consenting to our use of your personal data as described below.

Mondaq has a "free to view" business model. Our services are paid for by Contributors in exchange for Mondaq providing them with access to information about who accesses their content. Once personal data is transferred to our Contributors they become a data controller of this personal data. They use it to measure the response that their articles are receiving, as a form of market research. They may also use it to provide Mondaq users with information about their products and services.

Details of each Contributor to which your personal data will be transferred is clearly stated within the Content that you access. For full details of how this Contributor will use your personal data, you should review the Contributor’s own Privacy Notice.

Please indicate your preference below:

Yes, I am happy to support Mondaq in maintaining its free to view business model by agreeing to allow Mondaq to share my personal data with Contributors whose Content I access
No, I do not want Mondaq to share my personal data with Contributors

Also please let us know whether you are happy to receive communications promoting products and services offered by Mondaq:

Yes, I am happy to received promotional communications from Mondaq
No, please do not send me promotional communications from Mondaq
Terms & Conditions (the Website) is owned and managed by Mondaq Ltd (Mondaq). Mondaq grants you a non-exclusive, revocable licence to access the Website and associated services, such as the Mondaq News Alerts (Services), subject to and in consideration of your compliance with the following terms and conditions of use (Terms). Your use of the Website and/or Services constitutes your agreement to the Terms. Mondaq may terminate your use of the Website and Services if you are in breach of these Terms or if Mondaq decides to terminate the licence granted hereunder for any reason whatsoever.

Use of

To Use you must be: eighteen (18) years old or over; legally capable of entering into binding contracts; and not in any way prohibited by the applicable law to enter into these Terms in the jurisdiction which you are currently located.

You may use the Website as an unregistered user, however, you are required to register as a user if you wish to read the full text of the Content or to receive the Services.

You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these Terms or with the prior written consent of Mondaq. You may not use electronic or other means to extract details or information from the Content. Nor shall you extract information about users or Contributors in order to offer them any services or products.

In your use of the Website and/or Services you shall: comply with all applicable laws, regulations, directives and legislations which apply to your Use of the Website and/or Services in whatever country you are physically located including without limitation any and all consumer law, export control laws and regulations; provide to us true, correct and accurate information and promptly inform us in the event that any information that you have provided to us changes or becomes inaccurate; notify Mondaq immediately of any circumstances where you have reason to believe that any Intellectual Property Rights or any other rights of any third party may have been infringed; co-operate with reasonable security or other checks or requests for information made by Mondaq from time to time; and at all times be fully liable for the breach of any of these Terms by a third party using your login details to access the Website and/or Services

however, you shall not: do anything likely to impair, interfere with or damage or cause harm or distress to any persons, or the network; do anything that will infringe any Intellectual Property Rights or other rights of Mondaq or any third party; or use the Website, Services and/or Content otherwise than in accordance with these Terms; use any trade marks or service marks of Mondaq or the Contributors, or do anything which may be seen to take unfair advantage of the reputation and goodwill of Mondaq or the Contributors, or the Website, Services and/or Content.

Mondaq reserves the right, in its sole discretion, to take any action that it deems necessary and appropriate in the event it considers that there is a breach or threatened breach of the Terms.

Mondaq’s Rights and Obligations

Unless otherwise expressly set out to the contrary, nothing in these Terms shall serve to transfer from Mondaq to you, any Intellectual Property Rights owned by and/or licensed to Mondaq and all rights, title and interest in and to such Intellectual Property Rights will remain exclusively with Mondaq and/or its licensors.

Mondaq shall use its reasonable endeavours to make the Website and Services available to you at all times, but we cannot guarantee an uninterrupted and fault free service.

Mondaq reserves the right to make changes to the services and/or the Website or part thereof, from time to time, and we may add, remove, modify and/or vary any elements of features and functionalities of the Website or the services.

Mondaq also reserves the right from time to time to monitor your Use of the Website and/or services.


The Content is general information only. It is not intended to constitute legal advice or seek to be the complete and comprehensive statement of the law, nor is it intended to address your specific requirements or provide advice on which reliance should be placed. Mondaq and/or its Contributors and other suppliers make no representations about the suitability of the information contained in the Content for any purpose. All Content provided "as is" without warranty of any kind. Mondaq and/or its Contributors and other suppliers hereby exclude and disclaim all representations, warranties or guarantees with regard to the Content, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. To the maximum extent permitted by law, Mondaq expressly excludes all representations, warranties, obligations, and liabilities arising out of or in connection with all Content. In no event shall Mondaq and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use of the Content or performance of Mondaq’s Services.


Mondaq may alter or amend these Terms by amending them on the Website. By continuing to Use the Services and/or the Website after such amendment, you will be deemed to have accepted any amendment to these Terms.

These Terms shall be governed by and construed in accordance with the laws of England and Wales and you irrevocably submit to the exclusive jurisdiction of the courts of England and Wales to settle any dispute which may arise out of or in connection with these Terms. If you live outside the United Kingdom, English law shall apply only to the extent that English law shall not deprive you of any legal protection accorded in accordance with the law of the place where you are habitually resident ("Local Law"). In the event English law deprives you of any legal protection which is accorded to you under Local Law, then these terms shall be governed by Local Law and any dispute or claim arising out of or in connection with these Terms shall be subject to the non-exclusive jurisdiction of the courts where you are habitually resident.

You may print and keep a copy of these Terms, which form the entire agreement between you and Mondaq and supersede any other communications or advertising in respect of the Service and/or the Website.

No delay in exercising or non-exercise by you and/or Mondaq of any of its rights under or in connection with these Terms shall operate as a waiver or release of each of your or Mondaq’s right. Rather, any such waiver or release must be specifically granted in writing signed by the party granting it.

If any part of these Terms is held unenforceable, that part shall be enforced to the maximum extent permissible so as to give effect to the intent of the parties, and the Terms shall continue in full force and effect.

Mondaq shall not incur any liability to you on account of any loss or damage resulting from any delay or failure to perform all or any part of these Terms if such delay or failure is caused, in whole or in part, by events, occurrences, or causes beyond the control of Mondaq. Such events, occurrences or causes will include, without limitation, acts of God, strikes, lockouts, server and network failure, riots, acts of war, earthquakes, fire and explosions.

By clicking Register you state you have read and agree to our Terms and Conditions