Property outside of Canada: Wills + Estate Planning
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When an Albertans owns property in a foreign country, the legal dynamics of their will and estate planning arrangements shifts from a process governed by a specific provincial jurisdiction to a complex web of international conflict of laws, which entails more sophisticated estate planning. This is predicated in part by the distinction of asset types, which are distinguished for estate planning purposes as either movable property (bank accounts, jewelry, vehicles) or immovable property (land and buildings). Under the Wills and Succession Act (Alberta), movable assets are generally governed by the laws of the deceased’s domicile (Alberta), whereas immovable property is almost universally governed by its lex situs (the law of the jurisdiction where the land is physically located). This means that while an Alberta court can grant probate for your home in Calgary or Edmonton, it lacks the requisite jurisdiction to transfer title for a villa in the south of France or a condominium in Florida, necessitating additional legal processes in those territories.
Property in the United States introduces significant exposure to federal estate taxes, which differ sharply from Canada’s deemed disposition at death. While Canada taxes the capital gain (the increase in value), the United States taxes the fair market value of the asset if the estate exceeds certain thresholds. For 2026, Alberta residents must be mindful of the sunsetting of high U.S. exemption limits, which could expose more Canadian estates to a top tax rate of 40%. Fortunately, the Canada-U.S. Tax Treaty provides a pro-rated unified credit that can often offset this liability, but claiming this credit requires the executor to file a complex U.S. estate tax return, which involves disclosing the deceased's worldwide assets to the U.S. Internal Revenue Service.
European jurisdictions present a different challenge, primarily through the doctrine of forced heirship found in civil law systems like those of France, Italy, and Germany. Unlike Alberta, where testators enjoy broad testamentary freedom (subject only to certain dependent support obligations), many European nations mandate that a specific percentage of the estate must pass to children or a spouse, regardless of what the will says. This can lead to a legal impasse where an Alberta will attempts to leave a French home to a charity, but French law overrides this to protect the reserve for the heirs. Without specific planning, the Alberta resident's intentions may be partially or fully frustrated by these rigid statutory successions in certain European countries.
The EU Succession Regulation (Brussels IV) offers a critical tool for Albertans to regain control over their European real estate. Under this regulation, a person can choose the law of their nationality (Canada) to govern the succession of their entire estate, including immovable property located within participating EU member states. To be effective, this choice must be expressly declared in a will or codicil. By specifically electing Alberta law, an Albertan can effectively opt out of European forced heirship rules. However, this election only covers who inherits the property; it does not exempt the estate from local European inheritance taxes, which can be substantial and are often separate from succession law [more on navigating EU Succession Regulation].
Administrative hurdles often leads to the recommendation of a Multiple Wills strategy for Albertans with international property. Relying on a single Alberta will usually requires reliance on a resealing process or an ancillary grant of probate in the foreign jurisdiction, which involves expensive certified translations, legal opinions on Alberta law, and significant delays. By drafting a separate Situs Will specifically for the foreign property (written in the local language and complying with local formalities), the probate process can run concurrently in both countries. This allows the foreign executor to deal with the local property registry and tax authorities immediately, without facing the challenges of a multi-national court procedures, which involve increased challenges and costs.
Achieving the appropriate legal strategy when you own property outside of Canada comes from addressing the matter early on with knowledgeable legal counsel that can properly investigate and coordinate to produce a will and other estate planning documents that optimize your outcome. We welcome you to contact our law firm today at 403-400-4092 or via email at Chris@NeufeldLegal.com to schedule a confidential initial consultation.
For Chinese Non-Residents owning real estate in Canada: considerations related to your Canadian real property and your Chinese will. The complexity of foreign property can also be seen where property is situated in India, Asia and Africa, or vacation property that is situated in Mexico.
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