The vocabulary related to attending to a estate’s affairs may sometimes seem unfamiliar. We compiled a list of the key concepts and rules related to inheritance matters.
Estate
‘Estate’ refers to the deceased person’s property and debts as a whole. The persons inheriting the deceased may also be collectively called an ‘estate’ or sometimes the ‘heirs’. The parties together represent the estate and exercise control over its assets. This is called the estate’s ‘joint administration’. The execution of an estate starts right after a person’s death. The key execution measures are the estate inventory, payment of debts, cashing-in of the property and concentration of the funds for the estate inventory. The estate is terminated after all the property belonging to it has been lawfully distributed. An estate may also be left partly or fully undistributed.
Party to the estate
Parties to an estate are the lawful heirs, the widow(er) until the execution of the partition and recipients of a general will. The main rule to be followed is that all the parties’ should collaborate in person or through a representative with a specified power of attorney. Even one party alone may perform urgent measures without the other parties’ consent. The parties to an estate do not include the widow(er) if they had an exclusive prenuptial agreement with the deceased, the cohabiting partner, a legatee or the estate’s creditor.
Estate inventory deed
The deceased’s estate inventory deed is the estate’s basic document, which is drafted during the estate inventory. The estate inventory deed states, among others, the parties to the estate and the value of the deceased’s and the widow(er)’s property and debts at the time of death. Documents specifying the status of the estate, such as the report on the deceased’s family relationships, will and pre-/postnuptial agreement, are appended to the estate inventory deed. The estate inventory must be conducted within three months from the death. An extension to the three-month period may be applied for from the tax authority. Upon application, the Digital and Population Data Services Agency can provide a certification which confirms that all the parties are recorded on the estate inventory deed as required by the law. The deceased person’s estate inventory deed must always be submitted to Nordea Finance in full.
Will
A person to be inherited by means of a will may determine who obtains the subsequent title to the estate’s property, either to the entire property or to a proportionate distributive share (general will), decide on the recipient of specified property, such as a share in a housing company (special will, ‘legacy’) or assign the right to control over the estate’s property and to obtain its returns (‘usufruct will’).