It is important to prepare a Will to ensure that your estate is given to the people you care about upon your death. It should nominate who is in charge of managing your estate and describe how your assets are to be distributed.
If you do not make a Will, your estate may be divided up according to intestacy legislation irrespective of your wishes and the various needs of those who survive you. Similarly, if your will does not suit your circumstances it can result in stressful and delayed administration.
Having a Will enables your estate to be administered efficiently and cost effectively and usually without argument.
We would recommend you instruct a lawyer to prepare your Will as estate planning is a technical area and there are also strict formal requirements.
Once you have executed your Will, you should review it every 3-5 years to ensure that it still reflects your wishes and has not been revoked by changes in your circumstances.
Depending upon your circumstances it may be prudent to dispose of your assets through the vehicle of a testamentary trust incorporated in the Will. Trusts provide flexibility, protection and tax advantages for your nominated beneficiaries. There are other kinds of trusts, such as protective trusts and special disability trusts, which may suit your circumstances.
In addition to preparing your Will a comprehensive estate plan should also consider your Enduring Power of Attorney and any superannuation death benefits, family trusts, business structures and any life insurance to ensure that your wealth is passed to the people you wish to benefit.
Enduring Powers of Attorney
An Enduring Power of Attorney provides someone with the power to make financial, property, personal and healthcare decisions for you if you lose capacity to make decisions for yourself either for short or long periods due to accident or illness. An Enduring Power of Attorney is often called a ‘living Will’.
Having an Enduring Power of Attorney ensures that someone has the power to take care of you and other people within your family.
If you do not do an Enduring Power of Attorney it may be necessary for someone to apply to the ACT Civil and Administrative Tribunal to obtain financial and/or guardianship orders to take care of you and your property.
We can tailor your Enduring Power of Attorney to your specific circumstances to enable someone to assist you with your personal and financial matters while also ensuring that your interests are protected.
An attorney has special duties. For example, an attorney must always act in the principal’s best interests, make the decision the principal would have made (where possible), avoid conflicts of interest, keep finances separate and keep accurate records. If you have been nominated as someone’s attorney, we recommend you take legal advice to ensure that you are aware of your special responsibilities.
A General Power of Attorney provide someone with the power to carry out your property and financial decisions while you have capacity but are unable to do so yourself. General Powers of Attorney are useful in certain circumstances, for example, if you are travelling overseas. They cannot, however, be used if you lose capacity.
When someone dies the executor of their estate must collect and protect the assets, pay all liabilities and distribute the estate in accordance with the Will. If someone dies without a valid Will, this person is called an ‘administrator’ and they must distribute the estate in accordance with intestacy legislation.
It is usually necessary for the executor to obtain a Grant of Probate from the Supreme Court. A Grant of Probate validates the Will and authorises the executor to administer the estate according to the law and to distribute assets of the estate to the nominated beneficiaries.
Where a person dies without a valid Will a Grant of Letters of Administration is often required to be obtained from the Supreme Court to allow the assets and liabilities of the estate to be dealt with. To determine whether a Grant is required, the executor/administrator should contact the organisations with which the deceased held assets to determine the respective organisation’s requirements to transfer the assets. We can assist you with this task.
Executors and administrators have special duties and responsibilities to the beneficiaries of the estate. Administering a deceased estate is a complex and time consuming task, often requiring legal and accounting/taxation advice.
Estate litigation may involve defending or challenging the validity of a Will, defending or making family provision claims against an estate or a dispute between executors and beneficiaries.
We can help you understand what your rights are if you have been inadequately provided for under a Will.
We can also advise executors of a Will when someone tries to challenge the estate.
You should take legal advice if you are considering leaving somebody out of your Will who would expect to receive a benefit. It is important that you are advised properly in the preparation a Will in order to avoid or reduce the possibility of any challenges to the Will which will necessarily have the result of diminishing your estate and delaying its administration.
Superannuation is beginning to rival the family home as the most significant asset for many people.
Strictly, superannuation does not form part of your estate and must be dealt with outside of your Will. It is, therefore, very important to have a suitable superannuation plan in place.
What is suitable will depend on whether you have government, industry or self-managed superannuation. It will also depend on whether you have a spouse, young children or people you are financially dependent on you or in an interdependency relationship with you.
We can advise who can receive your superannuation, how you should ensure that they receive your superannuation and whether there may be any tax consequences.