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Advice regarding estate planning is essential to ensure that your estate passes effectively to those persons you wish to benefit and in the most efficient and tax effective way possible. Shire Legal can assist you to prepare a Will to give full effect to your wishes.
We always recommend keeping your will up to date as it makes distributing your estate far easier on your beneficiaries in what is already a hard enough time as it is.
Once your Will has been drafted, Shire Legal can hold your original Will in its safe custody at no charge. Shire Legal can also assist you with registering your Will with the Wills Register (at the Registry of Births, Deaths and Marriages). Whilst registering your Will is entirely voluntary, it will make it easier for your family to locate the Will when the time comes.
Wills are regulated by the Succession Act 2006.
What does my Will contain?
When you make a will, you appoint an executor. The role of the executor is to deal with your estate after your death. Your estate consists of any money, houses, land, cars, shares, insurance policies, superannuation entitlements, clothes, jewellery and any other goods owned by you.
The executor performs a number of duties in relation to the deceased. These include:
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attending to funeral arrangements;
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notifying any financial institutions and other relevant organisations of the deceased's death;
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ascertaining the size of the estate and taking control of all assets;
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identifying the beneficiaries and their entitlements;
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obtaining the grant of probate or letters of administration;
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resolving all estate liabilities and disputes. This will include settlement of income tax liability. It can also include waiting for the expiration of the six-month period after the grant of probate in which family claims against the estate can be started;
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appointing a new director to take over any of your company directorships (pursuant to Section 201F of the Corporations Act 2001). This is particularly important if you are the sole director/shareholder. Without a Will, the company may not be able to operate or trade for the months it will take for a close family member or friend to be appointed as the Administrator of your Estate and to be authorised to appoint a new director;
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distributing assets to beneficiaries either by transfer of ownership or by the sale of assets and distribution of the proceeds;
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investing funds or managing the assets of the estate on behalf of beneficiaries;
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keeping property held in trust for the life of beneficiaries in
good repair, insured and covered for rates and taxes; and
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acting impartially and in the best interests of all beneficiaries
If your spouse or another person is to be named as your sole beneficiary in your will, it is often appropriate to name that person as your sole executor. There is nothing to prevent a beneficiary from being an executor. Otherwise you should appoint another adult, a member of your family, a friend or a professional adviser to act as executor. You can also appoint a trustee company as your executor.
A testamentary trust can be established under a will. It appoints a trustee or trustee company, who may also be the executor of the will, to use property of the estate in a way specified in the will, for the benefit of the beneficiary.
What about superannuation and life insurance policies?
Your superannuation fund and life insurance policies are distributed in accordance with your binding death nomination which you set up with your superannuation fund/insurer, although you can usually specify that your funds are to be distributed in accordance with your Will, rather than being dealt with separately from your Will assets.
What happens if I don't have a Will?
If you die without having a valid Will, you will be deemed to have died "intestate". Your assets will then be distributed according to a legal formula provided by legislation, as follows:
- If the intestate dies leaving a spouse or spouses as well as children of the one or more spouses, then the spouse/s inherit the whole intestate estate and their children do not receive any benefit
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If the intestate leaves children from another relationship – that is other than with the current spouse – the estate is divided between the current spouse and the children from the previous relationship and children of the current spouse if any.
A “spouse” includes a married person or domestic partner. A domestic partner may be someone of the same or opposite sex.
“Multiple spouses” means more than one spouse. Spouse includes not only a married person but also a domestic partner. For the purposes of the distribution of an estate under the intestacy laws, a person may be in a relationship with the married person and one or more domestic partners all at the same time.
Even if you are satisfied with the above formula provided by the legislation, Shire Legal suggests that it is not an ideal position to take:
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You have no control over the distribution of your estate.
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There may be a forced sale of the family home or car to cover other beneficiaries' share of the estate.
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No guardian has been appointed for your children.
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Your children or grandchildren may not receive the financial protection you would have desired.
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Your estate may be administered by someone you would not appoint.
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Your family company may not be able to operator without a director if you have not appointed an Executor to have the power to appoint a new director.
Even if you don't have significant assets now, you may acquire them over time through building up your own personal cash assets, or even through an inheritance. If you don't have a Will, then a close family member or friend would need to apply to the Supreme Court to be appointed as the administrator of your Estate, a process which may take months. If, for example, you are a company director, the company may not be able to operate or even trade during this time, without someone properly authorised to make management decisions or act for the company.
Remember too that it's not just your financial assets that are dealt with in your Will. If you have young children, you can nominate who you would like to appoint as the guardian of your children. If you are the sole director of a company, your Executor will have the power to appoint an alternate director.
Who can witness my Will?
The law requires your signature on your Will to be witnessed by 2 independent persons over the age of 18. They do not necessarily have to have known you for a long time. They are merely witnessing the fact that you are signing the document. It is preferable for you to attend Shire Legal's office to execute your Will, so that we can ensure that the witnesses to your Will are totally independent. However, if because of your particular circumstances you are unable to attend our office to execute your Will, you need to make sure that your choice of witness does not invalidate your Will.
A beneficiary should not be a witness as they may lose their entitlement under the will. The law now allows the spouse of a beneficiary to be a witness. It also allows a beneficiary to be a witness if one of the following circumstances applies:
- there are at least two other attesting witnesses who are not beneficiaries
- written consent is obtained from all who would benefit directly if the gifts to the witness were not allowed; or
- the court is satisfied that the will-maker knew and approved of the gift and made it freely and voluntarily.
It is still recommended that a beneficiary does not witness the will.
A person who is unable to see that a will-maker has signed a document cannot act as a witness to a will. That includes someone who is temporarily unable to see.
Contact Shire Legal to arrange a consultation with an experienced solicitor.
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Suite 9
46-48 Urunga Parade
Miranda NSW 2228 Australia
Phone: 02 9526 3444
Fax: 02 9526 3499
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