Buying Property Abroad in a Child's Name or Through a Trust

Published on: July 3, 2026

Quick answer: It is possible, and for the right family it can be sound estate planning, but it is one of the most legally and tax complex ways to own abroad. The structure that works perfectly at home very often fails at the border: under lex situs, the law of the country where the property sits governs its succession, and a common law trust can be ignored by a civil law court that applies local forced heirship rules instead. The tools that actually hold up are situs wills, the EU Succession Regulation where it applies, recognised local structures, and coordinated dual counsel. This is general information, not advice, and it needs qualified legal and tax counsel in both your home country and the country of the property.

Buying foreign property in a child's name or through a trust is possible, and for the right family it can be a sound estate planning move. But it is also one of the most legally and tax complex ways to own abroad, and the structure that works perfectly in your home country very often fails at the border. A common law trust that would neatly avoid probate at home can be ignored entirely by a civil law court, which then applies its own inheritance rules to your property as if the trust did not exist.

This article explains why that happens, what putting a property in a child's name really exposes you to, and the tools that actually hold up across borders. It is general information to help you ask the right questions, not a substitute for advice. Anyone considering these structures needs qualified legal and tax counsel in both their home country and the country where the property sits.

The rule that overrides everything: lex situs

Real estate is governed by the law of the place where it is located. Lawyers call this lex situs. It is the principle that quietly defeats most cross border estate planning done from the home side only.

It means your home country will and your home country trust do not automatically follow your foreign property. When you die, the courts in the country where the house sits apply their succession law to it, and they will generally enforce that law even if your heirs live elsewhere and your will was drafted under your own country's rules. Any plan that ignores the local law of the property is a plan that may not survive contact with a foreign court.

Why trusts often fail abroad

The trust is a common law invention. It rests on splitting ownership into legal title (held by the trustee) and beneficial interest (held by the beneficiary). Most of the world's civil law countries, which include France, Italy, Spain, Portugal, Germany, and most of Latin America, simply do not have that concept.

In practice this means a civil law authority may let a trust hold title to a property, but it will not treat the trust as controlling who inherits. When the owner dies, courts routinely "look through" the trust and apply local succession law to the underlying property, exactly as if the individual had owned it directly. Islamic law jurisdictions similarly tend to decline trust recognition and apply their own mandatory inheritance rules. So the trust that was the centerpiece of the plan can end up doing nothing for the foreign asset, while adding cost and reporting.

Forced heirship: you may not be free to disinherit

Even setting trusts aside, many countries do not allow you to leave your property to whomever you choose. Under forced heirship, a fixed share of your estate is legally reserved for certain heirs, usually your children and spouse, and your will cannot override it.

Forced heirship regimes are common. They apply in France, Germany (through the Pflichtteil), Italy, Spain, Portugal, Brazil and much of Latin America, in Islamic law jurisdictions, and even within some Western jurisdictions such as the Canadian province of Quebec and the US state of Louisiana. In these places, a reserved portion goes to the reserved heirs no matter what your foreign will says. This is often a surprise to buyers from countries with full testamentary freedom, and it is precisely the kind of thing you want to know before you structure a purchase around passing the property to one specific person.

What putting a property in a child's name really exposes you to

Buying directly in a child's name looks simple, but it carries real risks that families underestimate:

• Loss of control. The child is the legal owner. Selling, mortgaging, or refinancing may require the child's consent, and a minor cannot always give it.
• Gift tax, in two countries. Transferring value to a child can be a taxable gift, potentially in both your home country and the country where the property sits. The rules and thresholds differ, and can be significant. See gifting property abroad and lifetime transfers.
• The child's own exposures. Once the asset is in their name it can be reachable by their creditors, or drawn into a divorce, in ways you did not intend.
• Capacity and timing. If the child is a minor, ownership and any later sale run into guardianship and capacity rules that vary by country.

None of this makes the approach wrong for every family. It makes it a decision that needs professional modeling of the tax and control consequences on both sides of the border, not a shortcut taken to "keep it simple."

The tools that actually work across borders

The good news is that cross border estate planning for foreign property is a solved problem when it is done correctly and locally. The instruments that tend to hold up:

• Situs wills. A separate will for each country where you own property, drafted by local counsel to meet that country's formalities. This is the workhorse of international estate planning and avoids the "one home country will for everything" trap. See why you may need a separate will for foreign property.
• The EU Succession Regulation (often called Brussels IV). For property in participating EU states, a foreign national can elect in their will to have the law of their nationality govern the succession of their European assets, which can sidestep local forced heirship. It only works if it is explicitly and correctly drafted into the documents.
• Recognized local structures. Some countries have their own vehicles that function where a foreign trust would not. Mexico uses the fideicomiso (a bank trust) for property in its restricted zone, and its succession must be addressed explicitly. France commonly uses a property holding company (an SCI) to manage ownership and succession. The right structure is country specific.
• Coordinated dual counsel. The consistent thread in every serious international plan: a lawyer in your home country and a lawyer in the country of the property, working together, so that the two plans do not contradict each other.

A note on tax reporting

Structures also create ongoing reporting obligations that are easy to overlook and expensive to get wrong. US persons who own foreign property through trusts or foreign corporations can face filings such as Forms 3520, 3520-A, 5471, or 8858, with steep penalties for non compliance. Canadians who hold foreign property above a cost basis threshold have T1135 obligations. The reporting is not optional, and it is a core reason to involve a cross border tax professional before, not after, you buy. Our overview of cross border inheritance and estate planning puts the pieces together.

Where JanusHermes fits, and where it does not

To be clear about our role: JanusHermes does not give legal or tax advice, and no structure like this should be built on a marketing page. What we do is connect you to verified, licensed local agencies across 50 plus countries, in your own language, who work alongside the lawyers and accountants you appoint. The local agent helps you find the right property and the right local professionals to structure it correctly under lex situs. The specialist advisors do the structuring. That division of labor is exactly how these deals are supposed to be done.

Frequently asked questions

Can I buy property abroad in my child's name?
In many countries, yes, but it can trigger gift tax in two jurisdictions, hand legal control to the child, and expose the asset to the child's creditors or divorce. It needs professional tax and legal modeling on both sides before you proceed.

Will my trust be recognized if it owns foreign property?
Often not in civil law countries, which include most of Europe and Latin America. Courts may let a trust hold title but ignore it for inheritance, applying local succession law to the property instead.

What is forced heirship and where does it apply?
Forced heirship reserves a fixed share of your estate for certain heirs, usually children and spouse, regardless of your will. It applies in France, Germany, Italy, Spain, Portugal, much of Latin America, Islamic law jurisdictions, Quebec, and Louisiana, among others.

What actually works for passing on foreign property?
Country specific situs wills, the EU Succession Regulation where it applies, recognized local structures such as a fideicomiso or an SCI, and coordinated legal and tax counsel in both your home country and the property's country.

Find a local team to work alongside your advisors

Structuring is the advisor's job. Finding the right property and the right local professionals is where a vetted agent helps. Browse verified, licensed agencies across 50 plus countries on JanusHermes, in your own language.

This article is general information only and is not legal, tax, or estate planning advice. Inheritance, gift tax, trust recognition, and reporting rules vary significantly by country and change over time, and they depend on your citizenship, residency, and the specific property. Engage qualified legal and tax professionals in both your home country and the country where the property is located before making any decision.