What You Should Know About the Inheritance Contract in Switzerland

According to Article 481 paragraph 1 of the Swiss Civil Code (ZGB), an inheritance contract is an alternative to a will, allowing you to decide during your lifetime on the transfer of your assets to one or more heirs. It is a legally binding contract between you as the testator and at least one other contracting party. To be valid, an inheritance contract requires notarization and the signature of two witnesses (Article 512 ZGB).

An inheritance contract differs from a will in that all contracting parties are aware of the contents of the contract and therefore know what they will inherit. Furthermore, the consent of all parties is required if the inheritance contract is to be amended or revoked, which is not the case with a will.

Who can enter into an inheritance contract?

To enter into an inheritance contract, all parties must be of legal age and able to dispose of their estate independently. For example, it is not possible for a minor to be represented in an inheritance contract.

Tip: An inheritance contract is particularly suitable for unmarried couples (cohabiting couples), as they are not considered legal heirs upon the death of one partner. Inheritance contracts can also be suitable for families in which the administration of the estate is contentious or may be particularly complicated due to the family situation.

Who keeps the inheritance contract safe?

The specific form and content requirements of the inheritance contract are regulated by Swiss inheritance law. The safekeeping of the inheritance contract, however, is regulated in Article 112 paragraph 4 of the Notarial Act and stipulates that the inheritance contract is to be kept safe after its official opening by the notary, i.e., the respective notary. As long as the contract is not opened, it can also be kept in a private location. It is also possible to have the storage location of the inheritance contract registered in the central will register.

Will or inheritance contract?

Like a will, an inheritance contract also serves to establish a person’s final wishes regarding the transfer of their assets. However, there are fundamental differences between the two types of contracts. One of the main differences between a will and an inheritance contract is that at least two people are required to draw up an inheritance contract, whereas a will is drawn up by one person. With an inheritance contract, the heirs know the contents and agree on the succession, whereas with a will, this only occurs upon its opening, i.e., after the death of the testator.

While a will does not require notarization, an inheritance contract always requires this. Furthermore, unlike a will, an inheritance contract cannot be unilaterally amended. Amendments to an inheritance contract must be agreed upon by all parties (Articles 513 to 515 of the Swiss Civil Code).

A will offers the testator more freedom than an inheritance contract, which is why the latter is generally not the standard option for arranging an estate in Switzerland. Nevertheless, an inheritance contract does have certain advantages. For example, in the case of business succession, an inheritance contract can be used to transfer the business to a specific person and jointly regulate the terms of the transfer.

Since the binding effect of an inheritance contract is significantly greater than that of a will, testators can use an inheritance contract to ensure a binding inheritance, for example, as a replacement for advance payments such as care benefits in old age. Married couples can also name each other as sole heirs in an inheritance contract if the children waive their statutory share.

Tip: If you want to agree to a waiver of a statutory heir’s statutory share in an inheritance contract, we recommend consulting an inheritance law attorney.

The creation of an inheritance contract follows the same procedure as the creation of a public, i.e., notarized, will. The inheritance contract is drafted by a notary public or a notary assistant, followed by confirmation for the contracting parties and the signature of the inheritance contract by the parties. Witnesses are then asked to confirm this.

It is also possible to combine the creation of an inheritance contract with that of a prenuptial agreement, or to conclude both simultaneously. Both contracts can then be combined into one document. In most cases, it is advisable to seek legal advice when drafting an inheritance contract in order to be aware of all the options and to utilize them legally.

When drafting an inheritance contract, you can choose between two types. There is the inheritance grant contract and the inheritance waiver contract. Which contract is best suited for you and your heirs depends on the specific situation.

The inheritance grant contract

With the inheritance grant contract, also called the inheritance assignment contract, you can favor a specific heir or appoint a third party as heir. This solution is usually chosen by married couples who appoint each other as heirs in order to each receive the largest portion of the estate, or when the testator wishes to donate part of their legacy to a charitable organization or foundation in accordance with Article 493 of the Swiss Civil Code.

The inheritance waiver contract

The inheritance waiver contract contrasts with the inheritance distribution contract, as with it, a legal heir waives their inheritance in accordance with Article 495 paragraph 1 of the Swiss Civil Code. Typically, the disinherited person receives compensation for this (so-called gratuitous waiver). It should be noted that if a child renounces their inheritance, their own descendants are also no longer entitled to inherit (Article 495, Paragraph 3 of the Swiss Civil Code).

A renunciation agreement is generally used if the testator anticipates inheritance disputes after their death or, for example, wishes to support a child with financial gifts during their lifetime.

Notary fees for drawing up an inheritance contract are generally charged on an hourly basis. However, as a rule of thumb, you should expect a maximum of 1% of your net assets at the time of signing the contract. If you engage a lawyer specializing in inheritance law to draft your inheritance contract, you should expect additional costs.

How can an inheritance contract be revoked, amended, or contested?

An inheritance contract can only be revoked or amended with the consent of all contracting parties. This makes the inheritance contract binding, unlike a will. According to Article 513, paragraphs 2 and 3 of the Swiss Civil Code, an inheritance contract can only be revoked unilaterally in rare cases, for example, in cases of deception.

The annulment of an inheritance contract can be requested during one’s lifetime if:

• the inheritance contract is to be annulled by mutual consent (Article 513 paragraph 1 of the Civil Code)
• there is grounds for disinheritance (Article 513 paragraph 2 of the Civil Code)
• if the agreed consideration for the inheritance is not provided (Article 514 of the Civil Code)
• one of the heirs dies (Article 515 of the Civil Code)

Anyone disadvantaged by an inheritance contract can also contest it. However, such a challenge requires a legally significant reason. Often, it is the omitted heirs who demand the contestation of the inheritance contract, particularly to assert their statutory share.

How can one renounce one’s inheritance?

In a renunciation of inheritance contract, legal heirs can agree to renounce their inheritance (Articles 495 to 497 of the Civil Code). A distinction is made between a complete and a partial renunciation of inheritance. A complete renunciation means that the person in question is no longer considered an heir. This means that the descendants of the renouncing heir also lose their right of inheritance (Article 495, paragraph 3 of the Civil Code). If a third party is appointed as heir in place of the renunciating heirs and does not accept the inheritance, the renunciation becomes invalid (Article 496, paragraph 1 of the Civil Code).

In the case of a partial renunciation, however, the testator does not lose his entire status as heir, but only his share of the estate in accordance with the agreements made in the inheritance contract.

Can I still make gifts after concluding an inheritance contract?

It should be noted that gifts after concluding an inheritance contract have been more restricted since the 2023 revision. Dispositions mortis causa and gifts made during one’s lifetime – with the exception of customary occasional gifts – can be contested if they conflict with the obligations under the inheritance contract and have not been expressly reserved in the inheritance contract.

It is therefore crucial to specify in the inheritance contract whether and to what extent the testator may make gifts after concluding the inheritance contract. Existing inheritance contracts should therefore be reviewed and, if necessary, amended.