elderly man reclining in a chair with friends and family

Why do I need a Will?

Whilst a Will is probably one of the most important documents that a person will ever sign, current statistics show that almost one in two Australians do not have a Will or if they have a Will, it is invalid.

If someone was to die and either does not have a Will, or leaves a Will which is invalid then it means that person has died “intestate”.  When this occurs, the Rules of Intestacy as contained in the Succession Act 1981 (Qld) determine how the deceased’s estate assets will be distributed.  This includes real assets, bank accounts, shareholdings and other assets that the deceased owned at the date of their death.

How is an intestate estate distributed?

  • Married with no children

If the deceased was married with no children then the whole estate is given to the surviving spouse.

  • Married with children

If the deceased was married with children and a surviving spouse then:

    • if the value of the estate is less than $150,000.00 excluding household chattels, then the whole estate is given to the surviving spouse; or
    • if the value exceeds $150,000.00 excluding household chattels, then the surviving spouse is given household chattels, $150,000.00; and
      • if there is only one child then one half (1/2) of the remainder of the deceased’s estate; or
      • if there are two or more children then one third (1/3) of the remainder of the estate; and
    • the children receive the remainder of the estate.
  • No surviving spouse or single with children

If there is no surviving spouse or the deceased is single with children at the date of death then the surviving children take the whole estate of the deceased in equal shares.

  • Single with no children

If the deceased was single with no children then the deceased’s parents stand to inherit the entirety of the deceased’s estate should they survive the deceased.  If the deceased’s parents predecease the deceased then the deceased’s siblings will inherit the entire estate in equal parts.

Ensure your wishes are clear

If a person dies without a Will, it is unlikely that their estate will be distributed in line with their exact wishes.  Therefore, having a valid Will is one of the most important things that a person can do for themselves and their family.

If you would like more information about estate planning and what estate planning documents are, including Wills, Powers of Attorney, Advance Health Directives and more, please go to our Wills & Estate Planning section or contact one of our team today.

If you would like further information and assistance with the preparation of your Will, contact one of our local experts today.

(07) 4963 2000
ONLINE ENQUIRY
Catherine Da Silva, Lawyer, Wallace & Wallace Lawyers

Catherine Da Silva
Solicitor
Business & Property

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Three pairs of concentric hands with gold coins

Do I really need a Binding
Death Benefit Nomination?

It is common for people to think that they don’t have many assets and, therefore, do not need estate planning advice when actually the superannuation benefit payable on their death is often a substantial amount and is their most significant asset.

Many people do not realise that some assets, such as superannuation, life insurance and jointly held assets (usually the family home), will not automatically fall into their estate when they pass away.  As superannuation is not an estate asset, on a person’s death their superannuation benefit does not automatically flow to their estate.  Generally, the trustee of the superannuation fund will pay a superannuation benefit in accordance with the governing rules of the fund and relevant legislation at the time of death.

Who is entitled to claim your superannuation benefit?

In the event that you have not prepared a valid Binding Death Benefit Nomination then your spouse, children and anyone else classed as your dependent are able to make a claim for your superannuation benefit.

For the purpose of superannuation laws:

  • a “dependent” includes:
    • a spouse (including a defacto partner);
    • children under the age of eighteen (18);
    • any person financially dependent on you; and
    • a legal personal representative.
  • a “spouse” includes anyone living with you as a defacto partner at the time of your death regardless of the period.

A way to override the trustee’s discretion is to prepare a valid Binding Death Benefit Nomination.  This will ensure that your superannuation benefits are received by your intended beneficiary or beneficiaries.

Binding Death Benefit Nominations

If you wish to ensure that your superannuation benefit will be paid in accordance with your wishes then you will need to have in place a valid Binding Death Benefit Nomination at the time of your death.

A Binding Death Benefit Nomination is a legally binding nomination that allows you to advise the trustee of your superannuation fund who is to receive your superannuation benefit in the event of your death.  However, in order for it to be binding it must be valid (properly completed and witnessed).  It is also important to note that Binding Death Benefit Nominations will usually lapse every three years and need to be renewed.  Therefore, if you have previously prepared a Binding Death Benefit Nomination, however, it has lapsed the decision as to who receives your superannuation benefit will revert to the trustee of your superannuation fund.

A properly prepared estate plan is essential to ensure that your assets are distributed in accordance with your wishes.  If you would like further information and assistance to undertake estate planning including preparation of a valid Binding Death Benefit Nomination, please do not hesitate to contact one of our local experts today on 4963 2000 or via our online contact form.

Catherine Da Silva, Lawyer, Wallace & Wallace Lawyers

Catherine Da Silva
Solicitor
Business & Property

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A Family Provision Application can be made to the court to set aside or vary a Will, so that adequate provision may be made for an eligible person.

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Elderly couple preparing a testamentary trust Will

Why use a Testamentary
Trust

Under a standard Will, the Will-maker generally leaves their estate directly to individuals, that is, usually their spouse (if their spouse survives them) and then ultimately to their children.  However, if after the Will-maker’s estate is administered and those individuals subsequently divorce or suffer financial misfortune then the Will-maker’s hard earned assets may be at risk.

A Testamentary Trust is created by a Will and only comes into effect on the death of the Will-maker.  Preparing a Will which incorporates Testamentary Trusts ensures that:

  • the Will-maker’s hard earned assets are protected from their children’s misadventures after the Will-maker passes away, such as divorce or bankruptcy;
  • income may be distributed to a broader range of beneficiaries;
  • the beneficiaries can utilise the taxation advantages available which makes them an effective estate planning tool.

Benefits of a Testamentary Trust?

There are two main advantages for preparing a Will which incorporates Testamentary Trusts – Asset Protection and Taxation Benefits.

Asset Protection

Well drafted Wills incorporating Testamentary Trusts can:

  • ensure that assets held in the trust are separate from assets personally owned by the beneficiaries.  Therefore, in the event of a relationship breakdown, the assets held in the Testamentary Trust earmarked for the Will-maker’s children may be held separate from the assets of the relationship.  While asset protection cannot be guaranteed there is a higher level of protection than that provided to absolute gifts made by way of a standard Will.
  • be structured so to limit the control a certain beneficiary has over the asset which can protect against irresponsible use or early sale of the asset while allowing the beneficiaries to enjoy the use or income of the asset.
  • help to protect the Will-maker’s estate from creditors of beneficiaries if a beneficiary becomes bankrupt due to business misadventures after the Will-maker passes away.

Tax Benefits

Testamentary Trusts allow the beneficiaries to take advantage of the available income tax benefits by providing that:

  • all beneficiaries including minor children receive the tax free threshold;
  • distributions can be made from the trust, not just to the primary beneficiary but to other potential beneficiaries (including perhaps primary beneficiaries’ spouse, child or sibling).  This may be attractive as it allows potential beneficiaries to take advantage of lower income tax bracket thresholds that potential beneficiaries may have.

A properly prepared estate plan is essential to ensure that your hard earned assets are protected for your family members, both during your lifetime and after you pass away.  If you would like further information and assistance with the preparation of your estate plan, please do not hesitate to contact one of our local experts today on 07 4963 2000 or via our online contact form.

Catherine Da Silva, Lawyer, Wallace & Wallace Lawyers

Catherine Da Silva
Solicitor
Business & Property

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Amendments to the Succession Act 1981 mean that the end of a de facto relationship will be treated the same as a divorce when it comes to a person’s Will.

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De facto Relationships
and Wills

Will separating from my de facto partner impact my Will?

Amendments to the Succession Act 1981 on 5 June 2017 mean that the end of a de facto relationship will be treated the same as a divorce when it comes to the effect it will have on a person’s Will.

When a couple in a de facto relationship separate, parts of the deceased’s Will may be revoked if their former partner had been left any gifts under that Will, or where they had been appointed as the executor of the deceased’s estate.

It is therefore very important to review your Will once you become separated from your de facto partner.

Step children of a de facto relationship

Another way in which a de facto relationship is now treated the same as a marriage is in relation to the treatment of step children.

A de facto step child can now make a claim on your estate after you have passed away (known as a Family Provision Application) if they can show that their parent was in a relationship with (or married to) the deceased step parent at the time of either parent’s death.

If the parties were separated at the time of one parent’s death, the step children will not be eligible to make a Family Provision Application.

Contact us on 07 4963 2000 or via our online contact form to make an appointment to update your Will, or if you would like further advice about how your change in circumstances may impact your Will.

Lara Tom Lawyer

Lara Tom
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Elderly lady signing paperwork

Estate Administration
an Executor’s Responsibilities

When a person creates a Will, they appoint an executor to administer their estate upon their death.

What is an executor responsible for?

The executor is responsible for ensuring that all outstanding debts and taxes are paid and that the remaining assets are distributed according to the deceased’s final wishes as set out in their Will.

This is a position of great trust and must be carried out with care and integrity. If you have been named as an executor to a Will, it is important to remember that you must act in the best interests of the estate and the beneficiaries at all times.

What if there is a conflict between the beneficiaries?

If a conflict arises between beneficiaries, you cannot take sides but should instead try to mediate a resolution. The best way to avoid or minimise conflict is to maintain clear and regular communication with all beneficiaries about what is happening with the estate.

Further, where you are one of a number of executors, you must consult with the other executors and agree on a proposed course of action before taking any steps to administer the estate.

As an executor you must make sure that all liabilities of the estate are satisfied, and that the remaining assets of the estate are properly managed and protected until they can be distributed to the beneficiaries.

What duties might an executor need to perform?

Your duties as an executor may include:

  • protecting and auditing the deceased’s assets;
  • obtaining valuations for those assets;
  • confirming that all assets are appropriately insured;
  • applying to the Supreme Court for a grant of probate (if necessary);
  • finding and notifying the beneficiaries of their entitlements under the Will;
  • transferring or selling assets (where appropriate)
  • where assets are not able to be transferred or sold, maintaining those assets;
  • determining all debts and liabilities of the deceased;
  • paying any debts of the deceased (including debts incurred during the course of the administration of the estate);
  • defending the Will of the deceased where litigation is commenced against the estate;
  • preparing tax returns and obtaining income tax clearances;
  • maintaining a statement of assets and liabilities to be provided to beneficiaries upon request and at the conclusion of the administration of the estate; and
  • distributing the estate to the beneficiaries in accordance with the Will, only once satisfied that there is no likelihood of a claim being made for a share of the estate.

You may be surprised to learn that if there is an error in administering the estate, whether it is deliberate or accidental, you may be held personally responsible for any financial losses to the estate.

It is therefore vitally important to ensure that you properly perform all of your duties as an executor.

If you would like assistance with administering an estate
contact one of our expert lawyers

(07) 4963 2000
ONLINE ENQUIRY
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Family Estate Planning

Estate Planning – The importance
of a properly drafted Will

Your Will is one of the most important documents you will ever sign, and it must be properly drafted to ensure that the assets you have spent a lifetime collecting are left according to your wishes.

You may be surprised to learn that some of your assets, such as your superannuation, life insurance and your share of any jointly held assets (usually the family home), will not automatically fall into your estate when you pass away. Further, any assets which you control through family companies or trusts, but do not actually own, cannot be disposed of through your Will as part of your estate.

A well formulated estate plan is required to ensure that these assets benefit the people you choose, and in the most tax effective manner.

Including a testamentary discretionary trust in your Will is an example of such an estate plan. These discretionary trusts come into existence upon your death and can have significant benefits, including protecting the beneficiaries who receive your assets in the event they:

  • get into financial difficulties with creditors; and/or
  • are declared bankrupt; and/or
  • suffer a breakdown of their matrimonial relationships.

Further, income distributed from testamentary trusts to minors is taxed at the marginal rate. The special tax treatment received by these trusts can result in thousands of dollars in tax being saved annually upon the death of someone with a young family.

A properly prepared estate plan will take into account legal, taxation and financial issues. It is therefore important that you involve your solicitor, accountant and financial advisor in a coordinated approach to establishing and, from time to time, reviewing your estate plan.

If you would like assistance with the preparation of your estate plan, please do not hesitate to contact our office on (07) 4963 2000 or via our online contact form.

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