Division of Property in case of death

According to Finnish law the main rule is that spouses have marital rights to each other’s property. However, it is possible to limit the spouse’s rights to the couple’s common assets by a pre- or post-nuptial agreement.

A marriage can end in either divorce or death. In any case, the end of a marriage usually gives rise to questions in relation to how the property is divided.

When a marriage ends in the death of a spouse, the division of property and the rights of the widow or widower can be quite confusing. A common misconception appears to be confusing the division of property with actual inheritance.

A widow or widower has the right to half of the couple’s combined assets based on marital rights, not half of the inheritance. Therefore, a division of property must always be carried out before the distribution of inheritance. Consequently, property falling under the scope of the marital rights is determined and divided between the spouses, and the property falling under the scope of a prenuptial agreement, a will or a deed of donation is separated.

If the deceased spouse was the wealthier of the two, the widow or widower will receive something called an adjustment to even out the difference between the two spouses. According to Finnish law both spouses has the right to half of the combined marital property. However, a widow/widower may also reject such adjustment. After the division of the spouses' property has been divided, the property of the deceased person is distributed among the heirs.

The property a surviving spouse receives on the basis of marital rights is tax free, when the property a surviving spouses receives as an inheritance is liable to inheritance tax.

In any case, a deed on division must be prepared on the division of property. It may be incorporated in the deed of estate distribution or be prepared as a separate document.

As we mentioned in a previous blog post, unlike spouses in a marriage, cohabiting partners do not have any rights to each other’s property. When a cohabitation ends in the death of one of the partners, the surviving partner will keep their property and the deceased person’s property belongs to the estate.

These are by no means simple matters, and one may need some expert assistance in the division and separation of property. Familja has a lot of experience dealing with these types of matters and can help you navigate the situation and draw up an agreement on division.