Inheritance tax and second citizenship: where heirs pay

In brief

• In most countries inheritance tax depends on the deceased's tax residence, the location of the assets and sometimes the heirs' residence, not on citizenship.
• A passport from Vanuatu, Turkey or a Caribbean country neither creates nor removes inheritance tax by itself.
• Citizenship is decisive in a few countries. The main example is the US, which taxes its citizens' assets worldwide.
• Russia has had no inheritance tax since 2006; heirs pay only a notary duty.
• A second passport can change the applicable law: the EU Succession Regulation lets you choose the law of your nationality in a will.

What inheritance tax depends on

Inheritance tax is not an income tax; it has its own logic. Countries use three main criteria. The first is the deceased's residence: if the person was tax resident in a country at the time of death, it may tax all their assets worldwide. The second is the location of the assets: real estate is almost always taxed by the country where it is located, and often so are accounts, shares in local companies and other assets. The third is the heir's residence: in some countries the heir pays the tax if they live there, even if the deceased lived abroad.

Citizenship is rarely among these criteria. So simply obtaining a second passport does not change the tax picture. If you live in Russia and have obtained a Vanuatu passport, your heirs will inherit under Russian rules, and Russia has no inheritance tax. If you also own a flat in Greece, Greece will tax that flat, regardless of your passport. What tax residence is and how it is determined is covered in our articles on tax residence and the 183-day rule; the terms tax residence, 183-day rule and tax residence certificate are explained in the glossary.

What this means for you. If you have obtained a second passport but still live in the same country, inheritance tax for your children will most likely not change. What changes it is a move and a change of tax residence.

Inheritance tax in our programme countries

Below is a summary table for the countries where our clients most often hold passports, residence or assets. It is a general guide: each country has reliefs, exceptions and special rules for different relatives, and rates and thresholds change. They must be checked as of the current date before planning an estate.

Almost all citizenship by investment countries have no inheritance tax. Vanuatu has neither income tax nor inheritance tax; on succession see our article on Vanuatu citizenship and inheritance and a client case. Antigua and Barbuda, St Kitts and Nevis, Grenada, Dominica and St Lucia also have no inheritance tax, though property transfers may carry fees; more is in our articles on taxes in Antigua, St Kitts, Grenada, Dominica, St Lucia and Nauru.

Turkey is the exception among citizenship programme countries: it has an inheritance and gift tax. Inheritance rates range from 1% to 10% progressively, and gifts are taxed higher. It applies to assets in Turkey and to Turkish tax residents. If you obtained Turkish citizenship by buying property, your heirs will pay Turkish tax on that property. More is in our article on taxes for Turkish citizens.

What this means for you. Passports from Vanuatu and the Caribbean create no inheritance tax. Turkey has one, but only for assets in Turkey and residents of the country.

European residence countries: where inheritances are taxed

In Europe the picture is mixed. Portugal has no inheritance tax but applies 10% stamp duty to heirs other than a spouse, children and parents; for close relatives inheritance is effectively free. Cyprus abolished inheritance tax in 2000. Malta has no separate tax, but stamp duty may apply when inheriting property. For holders of the Portuguese Golden Visa, Cyprus permanent residence and Malta permanent residence, these are favourable conditions.

Greece does have inheritance tax. For a spouse and children the first EUR 150,000 is exempt, after which the rate rises from 1% to 10%; for distant relatives and others rates are higher. This also concerns golden visa holders: Greek property is taxed in Greece. In Italy the tax is mild for close relatives: 4% for a spouse and children only above EUR 1 million per heir; 6% for siblings and other relatives, 8% for others. If you move to Italy on the investor visa and become tax resident, Italy may tax your assets worldwide.

In Spain inheritance tax is regulated by the regions, and the differences are huge: in Madrid and Andalusia close relatives pay almost nothing, while elsewhere the tax can be significant. Since 2015 non-residents inheriting assets in Spain can also use regional reliefs. In Hungary the general rate is 18%, but spouses, children and parents are exempt.

The US and the UK: exceptions you need to know about

The US is the main exception to the rule that citizenship does not matter. US estate tax is levied by citizenship: a US citizen, wherever they live, pays tax on their worldwide assets at up to 40% above a large exemption. So an American passport or green card changes the inheritance picture for the whole family. If you are considering the US among options for a second citizenship or permanent residence, this must be taken into account before obtaining the status, not after.

Since April 2025 the UK has moved from the concept of domicile to long-term residence: if a person has been tax resident for at least 10 of the last 20 years, the 40% tax above the nil-rate band applies to their worldwide assets. For those who lived in the UK for a long time and left, obligations may continue for several years after departure.

What this means for you. If you are considering US citizenship or permanent residence, calculate the inheritance consequences first. It is the only major country where the tax depends on the passport rather than where you live.

Examples: who pays and where

To make this clearer, here are a few typical situations. These are simplified examples: in real life the outcome is affected by agreements between countries, the composition of heirs, a will and how long assets have been held.

The main conclusion from the examples: inheritance tax is determined not by a set of passports but by the combination of where you live and where your assets are. So estate planning should look at the map of the family's assets, not at the list of citizenships.

Double taxation of inheritances

There are few treaties on avoiding double taxation of inheritances: most tax treaties cover income and capital, not inheritances. So the same asset can in theory be taxed by two countries, for example the country where the deceased lived and the country where the property is located. Some countries resolve this with an internal credit for foreign tax, others do not. Russia has no inheritance treaties, but it has no inheritance tax either, so for Russians living in Russia the issue usually comes down to the tax of the country where the assets are.

It is harder for families where the deceased lives in one EU country and the assets and heirs are in others. In such cases it is easy to pay more than necessary without calculating in advance. A simple rule: if assets and family members are in three or more countries, the estate should be planned with a tax lawyer beforehand, not afterwards.

Where a second passport really helps: choice of law

There is one area where a second passport changes a great deal: the law under which an estate is divided. Since 17 August 2015 EU Succession Regulation 650/2012 has applied in most EU countries. As a general rule, succession is governed by the law of the country where the person was habitually resident at the time of death. But the regulation allows you to choose in a will the law of the country of your nationality. If you have several nationalities, you can choose any of them.

This matters because several EU countries have forced heirship: part of the estate must go to children and a spouse regardless of the will. In Spain, Italy and France, for example, forced heirship rules are strict. A person living in such a country but holding the citizenship of a country with freer testamentary law can choose that law and dispose of assets differently. Choosing the law does not change taxes, though: tax is paid under tax rules, not under succession law.

Russians have a particular feature. Russian law also has a compulsory share for minor and incapacitated heirs. If you have dual citizenship and assets in different countries, the will and the choice of law should be planned with a lawyer to avoid disputes among heirs and conflicts between legal systems.

What this means for you. A second passport does not reduce inheritance tax, but it can give freedom to dispose of assets under the law of your country of citizenship. This requires a will with an express choice of law.

How to plan an estate with two citizenships

If you plan to change tax residence, see our articles on the best countries for tax residence, tax residence in Cyprus and tax residence in the UAE. What zero tax gives in practice is covered in our analysis of zero taxes. Russians with assets abroad should consider their obligations to the tax authority; see our article on notifying foreign accounts and our story on tax changes in 2027. How citizenship by investment programmes work is explained in the glossary.

If you want to go through your situation, book an online consultation; all BRIDGES services are on the home page.

How this article was prepared

Sources: tax codes and succession laws of the countries listed as of October 2026; EU Regulation 650/2012 on succession; the Russian Tax Code and Fundamentals of Legislation on Notaries. Rates and thresholds are given in general terms and may change. This article does not replace advice from a tax lawyer.