Changes to the Inheritance Laws in the UAE from 1 February 2023 - What you need to know

The primary source of inheritance legislation in the UAE is Sharia Law and it has been incorporated and codified into various legislative UAE Codes such as the UAE Personal Status Law 2005 and the UAE Civil Code 1985. Currently, Sharia law is applicable to the Deceased’s assets located in the UAE in the absence of the Deceased’s Will. Until now, both Muslims and non-Muslims have been subject to the same inheritance regime concerning the assets located in the UAE. However, this regime is due to change shortly to accommodate all UAE residents regardless of their religion, bringing important changes for non-Muslim expats.

A Reminder on The Current Status of The Law:

Article 313 of the UAE Personal Status Law 2005 defines inheritance as “the imperative devolution of the property and financial rights upon the death of their owner to those deserving” and Article 318 provides that “there is no inheritance between persons of different religions”. Therefore, this article is based on the assumption that the Deceased, the widow, and children are all of the same religion, non-Muslim; and that they are all adults. The terms Deceased is used for both the wife and the husband.

Article 17.1 of the UAE Civil Code as amended by Federal Decree-Law No. 30/2020 provides that “Inheritance shall be governed by the laws applicable in the Deceased country of nationality at the time of his death”. It could be understood that when a foreigner dies leaving assets in the UAE, the Deceased’s country of nationality could be applicable pursuant to Article 17.1. However, Article 17.5 states that the UAE Inheritance Law provisions prevail concerning the assets located in the UAE in the absence of a Will.

When Does the Current Inheritance Law Apply for Non-Muslims?

The general rule is that the UAE Inheritance Law applies unless a non-Muslim elects for the laws of the nationality country to apply. Article 1.2 of the UAE Personal Status Law 2005 allows non-Muslim foreigners with assets in the UAE, to make a Will under the law of the home country and therefore, govern the succession of the UAE estate, instead of Sharia-based rules. 

Consequently, the legal heirs of the Deceased can apply to the UAE competent court to request the application of Deceased’s Will which the Deceased registered outside the UAE prior to the death. The Will must be translated to Arabic, attested by the country-of-origin competent authority, and attested by the UAE diplomatic representation of the said country and also by the Ministry of Foreign Affairs in the UAE. Documents evidencing the relationship must be also submitted to the court (Marriage certificate, birth certificate evidencing parenthood, family book, etc).

From a procedural side, Article 276 of the UAE Personal Status Law 2005 provides that, should the legal heirs want the Deceased national law to apply, they are required to file with the Court the death certificate; the Will of the non-Muslim Deceased; the Deceased last known address; name of the heirs and their last known address; the legatees and their last known address; and a list of the assets.

On the other hand, when a non-Muslim foreigner dies without making a Will, the assets in the UAE will be subject to a devolution based on Sharia Law. The absence of a registered Will in the UAE means that the Deceased’s assets will be divided in accordance with the Sharia Guidelines.

Therefore, the assets will be divided among the Deceased’s heirs (providing that the spouse proves her/his relationship with the Deceased and the children prove that they are the children of the Deceased by an official birth certificate or family book) pursuant to the Sharia Law incorporated into the UAE Personal Status Law 2005 in the following way:

Pursuant to Article 324 of the UAE Personal Status Law, the widow would receive a one-eighth of the estate, should the spouse (husband or wife) have a succeeding descendant. Therefore, the spouse of the Deceased would receive a one-eighth of the Deceased’s share in the assets located in the UAE.

Under Sharia Law, sons typically inherit twice the share of the daughters.  The UAE Personal Status Law 2005 provides at Article 352 that “a male shall have the share of two females in the inheritance”. This is applicable to sons and daughters regardless of whether they are of the same father and mother or not. 

How Does the Current Law Apply in Practice?

In a purely hypothetical scenario where the Deceased has left the amount of AED 1,000,000, the surviving wife or husband would receive a one-eighth of this amount (1/8, or 0.125) which would be AED 125,000. The remaining amount (AED 875,000) would be divided as follows: 

• there are three sons, as they receive twice the share of a daughter, the total shares for the sons would be six. 
• The daughters would receive two shares. 
• So, in total there are eight shares. 
• AED 875,000 would be divided by eight which equals AED 109,375 per share. 
• Therefore, each daughter would receive AED 109,375 and the sons would receive twice this amount (AED 218,750).
• The same would apply to a metric share for a land, weight for gold and silver inheritance, etc.  

The above applies until 31 January 2023. 

A Synthesis on The Upcoming Change In Law For Non-Muslims

On 1 February 2023 the Federal Decree-Law No. 41/2022 On Civil Personal Status will come into force and will change the current inheritance law for non-Muslims. 

Article 1 provides:

“The provisions of this Decree-Law shall apply to non-Muslims who are citizens of the United Arab Emirates, and to non-Muslim foreigners residing in the State, unless any of them insists on the application of their law,with regard to the articles of marriage, divorce, inheritance, wills and proof of parentage, without prejudice to the provisions of Articles (12), (13), (15), (16) and (17) of the abovementioned Federal Law No. (5) of 1985”

Pursuant to the above provision, providing that the Deceased was:

1. a resident in the UAE at the time of the death; and
2. non-Muslim and has not made an explicit declaration to divide the UAE estate under the applicable Inheritance Laws of the country of nationality (other than the UAE), 

the assets in the UAE shall be devolved in accordance with Articles 11.2 and 11.3 of Federal Decree-Law No. 41/2022 On Civil Personal Status issued on 3 October 2022, which provide:

“2. In the absence of a will, half of the inheritance shall go to the husband or wife, and the other half shall be divided equally between the children, without distinction between males and females. If the Deceased has no children, the inheritance shall devolve to the parents of the Deceased, if alive, equally, or half of it to one of them, if the other is dead, and the other half to the brothers of the Deceased, or all the inheritance shall devolve to a parent, if the other is dead and there is no spouse, child or brother of the Deceased, and if both parents are dead, all the inheritance shall devolve to the brothers of the Deceased equally, without distinction between males and females. 

3. As an exception to the provisions of paragraph (2) of this article, any of the heirs of a foreigner may seek application of the law applicable to inheritance in accordance with the provisions stipulated in the Civil Transactions Law, unless there is a registered will to the contrary”.

When and How Does the New Inheritance Law Apply for Non-Muslims?

Providing that the Deceased died intestate in the UAE, the above provisions shall apply to the distribution of the assets in the country from 1 February 2023. Therefore, the spouse (wife or husband) would receive half of the late spouse’s assets. The remaining half of the Deceased’s assets in the UAE would be divided between the children equally and without distinction of gender.

The above stated Federal Decree-Law No. 41/2022 of 03 October 2022 does not distinguish between real estate and personal estate. Therefore, the funds available in the bank account of the Deceased would be devolved in the same way as the real estate. The Deceased’s surviving spouse would receive half of the available balance and the remaining amount would be divided equally between the Deceased’s children and without distinction of gender.

In case where the UAE bank account is held jointly by the Deceased and another person, which could be the spouse, the civil partner or any other person,  pursuant to Article 379.4 of the Federal Decree-Law No. 50/2022 issuing the Commercial Transactions Law which came into force on 02 January 2023, the surviving joint account holder(s) must inform the bank within ten days of the death of the Deceased. Once notified, the bank freezes the account until the successors are appointed. The shares of the heirs of the said bank account, if held jointly, would be determined by the competent court in the UAE.

This article does not constitute a legal advice, but to raise awareness on the applicable laws. For further information and legal advice, please contact us or get in touch via our website.