Bequests: what you should know

According to the Swiss Civil Code (CC), a testator may bequeath money or property to a person, although this person does not necessarily have to be included in the order of succession under Swiss inheritance law (Article 562 CC). A bequest corresponds to a person’s last will and is determined by mentioning it in the will or inheritance contract. In Switzerland, a bequest is often also referred to as a legacy.

Types of bequests

Article 563 of the Swiss Civil Code does not contain any provisions on which objects, monetary or material assets can and cannot be bequeathed as part of a bequest. These are often, for example, works of art, jewellery or personal documents. However, it is also possible to bequeath rights. This could be the right to live in your home, for example.

Definition of a person

The law defines a person who can receive a bequest as a natural person as well as, for example, associations, museums or social organisations. The recipient of a bequest is also called the legatee.

An advance legacy is when the legatee is also the legal heir. The constellation of an advance legacy exists if the testator wishes to determine who should inherit a certain item, for example.

An advance legacy is particularly useful if you want to ensure that certain items end up in certain hands or if you want to prevent an inherited item from having to be sold so that the value of the item can then be divided among your community of heirs as a monetary value.

If the testator designates a subsequent legatee in his will in accordance with Article 488 et seq. ZGB in his or her will, this means that the bequeathed object initially goes to a prior legatee, who then transfers the estate to another person – in this case the subsequent legatee – after a certain period of time. With such a provision in your will, you can, for example, bequeath an item that is valuable to you to your son or daughter first and only later to your grandson or granddaughter. Other desired constellations are also possible.

If you would like a person to be able to use or continue to use something in full, even though they do not or no longer own the item in question, you can stipulate this in your will as part of a usufruct. According to Article 745 ff. ZGB, this is referred to as a personal easement. A usufruct under inheritance law can be considered, for example, if you wish to bequeath your residential property to your child but want to ensure that your spouse can continue to live in it until their death.

Object of the usufruct

The nature of the object of the usufruct is regulated by law. It must be a plot of land, a property, part of a property or a specific object. It can also be a right to an asset or part of an asset.

The person who has a right of residence may not rent. The situation is different in the case of usufruct. According to Article 766 f. ZGB, the person who holds the usufruct must pay for the mortgage, insurance and ancillary costs. In the case of a right of residence, any rent to the owner and ancillary costs are incurred. With regard to taxes, the usufructuary must pay tax on the official value of the property and any rental income. In the case of the right of residence, the rent paid is taxable. Certain deductions are possible and a gift may make sense under certain circumstances. If you are not sure which option is more favourable in your situation, it is advisable to consult a lawyer specialising in inheritance law.

How can the surrender of a bequest be requested?

As a non-member of a community of heirs, a legatee cannot demand the surrender of his estate from the probate court, as he is legally a creditor of the community of heirs. He must therefore first request the community of heirs to surrender the estate. If the community of heirs does not comply with the request, the legatee can send a written reminder to the community of heirs – this is the last step before filing a lawsuit. In this case, it is advisable to consult a lawyer – preferably before filing a lawsuit.

Special case: bequest vs. division provision

If a person is both a legal heir and a bequest recipient, ambiguous wording in the will can lead to confusion as to whether the bequeathed item is a bequest or a division provision. In this case, the object of monetary value will be offset against the compulsory portion. You should therefore ensure that the wording is clear.

Example of unclear wording:

‘I would like Mark to have my watch collection.’

Example of clear wording:

‘I am leaving my watch collection to Marie as part of a bequest.’

A lawyer specialising in inheritance law can help you draw up your will or inheritance contract.

Bequest: What should I pay particular attention to in terms of content?

As already mentioned, the exact wording of a bequest is particularly important. This alone can avoid potential inheritance disputes. You should pay particular attention to the following points

• Make it clear whether it is a bequest or a division provision.
• It is best to name heirs and legatees with their full first and last names.
• Describe an item in more detail if you own several so that it is clear which one is meant (negative examples: ‘My best horse in the stable’, ‘My favourite car’).

When does the temporal fulfilment of a bequest occur?

If the time of fulfilment of a bequest is not regulated in the will, the community of heirs can determine this themselves. A legatee can demand that the community of heirs surrender the bequest. In order to avoid any inheritance disputes from the outset, it is advisable to specify the relevant date in advance in the will.

Who pays the taxes on a bequest?

As with an inheritance, each legatee is liable to pay tax on a bequest. The actual amount of inheritance tax depends on the value of the bequest and the degree of kinship. As a rule, close relatives pay less tax than more distant relatives. The higher the value of the inheritance, the more tax the heirs have to pay. Tax deferral is possible under certain conditions.

Special case – charitable organisations: If the legatee is a non-profit or charitable organisation, taxation does not apply in this special case.

When does a bequest expire?

A bequest expires upon the death of the legatee, unless it is a prior bequest. In this case, the bequest is transferred to the subsequent legatee. If this person also dies, the original bequest becomes part of the other estate again.

Prohibition of chain legacies

Chain legacies are not permitted in Switzerland (Article 488 of the Swiss Civil Code). This means that the testator may appoint a maximum of one subsequent legatee. If the community of heirs reaches an agreement to this effect, the subsequent legatee may draw up a corresponding will during his or her lifetime. If in doubt, a lawyer specialising in inheritance law can advise you.

When does a bequest make sense?

A bequest is particularly useful if you want to favour a person who is not provided for in the legal succession. The advantage of a bequest is that you do not also bequeath debts, as is the case with an ordinary inheritance. A bequest is also the solution if you want a charitable organisation to share in your inheritance.

Do I have to draw up a bequest together with a legal adviser?

As a Swiss citizen, you can generally draw up your will on your own; neither a notary nor a lawyer is required by law. However, to avoid any legal problems and to ensure that your inheritance actually goes to the people you wish to benefit, it is advisable to consult a lawyer.