Inheritance in Israel — What Happens Without a Will? | Attorney Rozil Amir

Inheritance in Israel — Comprehensive Explanation of What Happens When There Is No Will

When a person passes away without leaving a will, their assets are not released to the state or distributed arbitrarily. In Israel, the Succession Law, 5725–1965 establishes a clear and unambiguous legal mechanism: heirs by law. This means that the law itself precisely defines who inherits the assets, in what order of priority, and in which relationships.

Inheritance without a will (also called "intestate succession" or "inheritance by law") is a legal process that requires legal proof of family relationship and obtaining an inheritance order from the family court. Many people in Israel assume the process is straightforward, but in practice it involves administrative procedures, evidence, and asset assessment fees — this is where professional legal counsel comes in.

At our office, we assist families in property distribution following the death of a family member without a will. We guide you through the legal mechanism, from filing a request for an inheritance order through to the completion of asset distribution in accordance with the law.

Who Are the Heirs by Law in Israel?

The Succession Law establishes a rigid order of priority. The heirs by law are divided into classes, and each class inherits only if the preceding class does not exist:

• First class: Sons and daughters (equal inheritance for each child, without distinction between sons and daughters under modern law).
• Second class: Parents of the deceased (if there are no children).
• Third class: Siblings (if there are no parents and children).
• Fourth class: Grandparents (if there are no preceding classes).
• Fifth class: Uncles and aunts, and more distant relatives — in the order of priority established by law.

It is important to note: a surviving spouse (spouse living at the time of death) inherits in accordance with a special order: if there are children, the spouse inherits a portion of the assets together with the children; if there are no children, the spouse inherits all the assets.

Significant Difference: Will versus Inheritance by Law

A will is a legal document in which a person decides during their lifetime how to distribute their assets after their death. A will provides complete flexibility: you can leave everything to one person, donate to a non-profit organization, or distribute in sophisticated ways.

Without a will, the law dictates the order. This protects close family members, but can also cause problems if the deceased's wishes were different from the law — for example, if they wanted to leave more to one child or donate to a non-profit organization.

The Inheritance Process in Israel — Deep Legal Steps

Step 1: Filing a Petition for an Inheritance Order with the Family Court

To begin asset distribution, a formal petition must be filed with the Family Court, coordinated according to the deceased's place of residence or the location of primary assets. The petition includes:

• Death certificate of the deceased.
• Proof of family relationship (birth certificate, marriage certificate, etc.).
• Initial list of assets (if known).
• Identification of potential heirs.

At this stage, the attorney handles drafting the petition, filing it with the court, and obtaining a case number.

Step 2: Examination of Assets and Liabilities

Upon filing the petition, all assets of the deceased must be examined (apartment, bank account, vehicle, securities, etc.) as well as liabilities (loans, debts, unpaid taxes). The assets are subject to legal examination to verify:

• Clear legal ownership.
• Whether there is a mortgage or lien on the asset.
• Whether the asset is jointly owned (spouse, partnership, etc.).

Examination fees vary according to the value of the assets. Generally, they range from 1% to 3% of the asset value and include checks with the Land Registry, Bank of Israel, Tax Authority, and more.

Step 3: Appointment of Estate Administrator (if required)

During the inheritance process, the court may appoint an estate administrator (or "estate manager") who will be responsible for managing the assets until final distribution. His duties include:

• Collection of all assets of the deceased.
• Payment of debts and liabilities (taxes, funeral expenses, etc.).
• Distribution of assets according to the order of heirs.

Step 4: Obtaining an Inheritance Order from the Court

After examination and approval, the court issues an inheritance order (or "order of execution of will" if there is a will). This order serves as legal proof that you are a lawful heir to certain assets. This order is required to:

• Transfer ownership of assets (apartment, land) to the Land Registry.
• Open a bank account in the name of the heir.
• Receive compensation from life insurance or pension funds.

Step 5: Actual Distribution of Assets

After obtaining the order, the physical and legal distribution of assets must be carried out. This includes:

• Transfer of ownership of real estate (apartment, land) to the Land Registry.
• Opening of bank accounts in the names of heirs.
• Transfer of securities and pension funds.
• Closure of accounts of the deceased.

This process may take months to a year, depending on the complexity of the assets and the cooperation of the heirs.

Step 6: Handling Inheritance Taxes

In Israel, there is no direct inheritance tax on heirs (unlike other countries). However, there are other liabilities:

• Capital gains tax: If the asset is land or an apartment that has appreciated in value, capital gains tax must be paid on the difference between the original purchase value and the value at the time of death.
• Land Registry registration fees: For the transfer of ownership of real estate.
• Legal examination fees: As mentioned, usually 1–3% of the asset value.

Comparison: Intestate Succession vs. Succession with a Will

When should you draft a will?

If you want complete control over the distribution of your assets, if you have children from different marriages, if you wish to leave money to a charitable organization, or if you have a complex family situation, drafting a will is essential. A will allows you to plan the future of your assets exactly as you wish.

Our firm specializes in drafting legally valid wills that protect your wishes and minimize the risks of future challenges or legal complications.

Deep Legal Issues in Intestate Succession

What About a Surviving Spouse? Is He/She an Heir?

Yes, a surviving spouse inherits in a special order of priority. If there are children, the spouse inherits a portion of the assets together with the children (typically, the spouse inherits one-third of the assets, and each child inherits one-third). If there are no children, the spouse inherits all of the deceased's assets.

Important: A spouse who is not registered in a legal marriage (for example, a spouse under common law) may not be recognized as an heir under the law, unless they prove a legal relationship (such as a recognized family partnership).

What About Children Born Out of Wedlock?

In Israel, children born out of wedlock inherit exactly like children born in wedlock. There is no legal distinction. They are part of the "first class" of heirs and their share in the assets is equal to other children of the deceased.

What Happens If One Heir Refuses to Accept His/Her Share?

If one heir refuses to accept their share of the assets, that share passes to other heirs in their class (if any exist), or to the next class. This is called "renunciation of inheritance" and must be formally documented in writing with the court.

Can the Order of Heirs Be Challenged?

No. The order of heirs under the law is statutory and cannot be changed. However, if there is a claim that a certain heir does not actually exist (for example, a claim that a child is not the biological child of the deceased), a legal petition can be filed to prove the family relationship.

What About the Deceased's Debts? Are the Heirs Required to Pay?

Yes. The heirs inherit not only assets but also the debts of the deceased. However, these debts are paid from the deceased's assets, not from the heirs' personal assets. In other words, if there is a mortgage on the apartment, the mortgage is paid from the value of the apartment, and then the heirs divide what remains.

What About Assets Abroad?

If the deceased had assets abroad (a house abroad, a foreign bank account, etc.), their inheritance will require legal proceedings abroad as well, in accordance with local laws. This is more complicated and requires international legal counsel.