Today is 4 October, Animal Day. So the newspapers are full of Animal Day news. Suppose you die before your pet: what can or must you arrange in that case?
Heir
No, your pet cannot be your heir. An animal is regarded as your property. Your heirs will inherit your pet. However, you can also specify in your will that someone else is to become the owner of your pet, for example by bequeathing it to them.
A pet costs money. You have to buy food for it, take it to the vet, and so on. To ensure that the heir or legatee of your pet is not left to bear these costs, you can leave them a sum of money in addition to the pet.
Inheritance tax
Of course, the tax authorities also have a say in all this. After all, anything that someone receives from your estate – whether as an heir or a legatee – is, in principle, subject to inheritance tax. This also applies when a pet is received. In most cases, the value of, for example, a dog or cat will not be included in the inheritance tax return. However, if, for example, you are bequeathed a horse, this may constitute an acquisition of (considerable) value.
The sum of money you allocate to the heir or legatee for the care of your pet is, in any case, subject to inheritance tax. Naturally, the exemptions may be taken into account. You can find the amounts in our factsheet Gift tax exemptions.
Load
There are calls to include an exemption in inheritance tax for the acquisition of pets, according to, amongst others, the AD. It seems that animal lovers, in particular, are in favour of this. After all, such an exemption does not really fit within the inheritance tax system.
In your will, you can attach a condition to the receipt of the sum of money, requiring that the animal be well looked after for the rest of its life. The problem, however, is that compliance with this condition would then need to be monitored. The question is how the value of such a condition can be determined and whether that value may be deducted from the value of the inheritance for the purposes of inheritance tax.