Wills and estates can be a confusing topic for many people. However, it is crucial to understand what a will is, how it works, and why you should have one. In this blog article, we cover the common questions related to wills and estates.
What is a Will?
A Will is a document that sets out what a person would like to happen with their assets when they die. Assets may include tangible property – such as houses or cars – or intangible property, such as superannuation or savings. When you pass away, the executor of your estate (someone you have appointed) distributes your will, and gives the assets you have allocated to each person.
Why should I have a Will?
- To ensure your family’s needs are met according to your wishes when you die
- To avoid leaving confusion behind
- To set out plans beyond the distribution of your wealth and assets. For example, a Will can include other requests such as:
- How children will be cared for
- The exclusion of particular family members
- The distribution of assets that do not form part of your estate (e.g. family trust assets)
- Charitable objectives (e.g. if there is any money left over after distributing to family members, you may donate the rest of your estate to a particular charity or cause)
- Who will be the executor of your estate. If you die without picking your executor, your closest family member will become the executor. You may also request that the public Trustee & Guardian (a government agency) administer your estate.
When should you review or update a Will?
Your Will should always reflect your current circumstances and intentions. It is therefore necessary to update your Will if you have any major life changes, such as:
- Marriage, separation, divorce or entering into a new relationship
- The birth or death of children, grandchildren or other close relatives
- Significant changes to the value of your assets
- Substantial changes in the way you own assets, such as the creation of a family trust or a self managed superannuation fund
- If you enter a new business or change the structure of your current business
- Changes in the residency status of you or your intended beneficiaries.
- Retirement from full time employment
- Significant changes to taxation, superannuation and social security laws which may impact upon your Will and estate
How can I challenge a Will?
If you believe you have been unfairly left out of someone’s Will, there are avenues to rectify this.
Family members, spouses, partners and anyone else who can show that they were financially dependent on the deceased person may be able to challenge a Will. However, there are strict time deadlines to challenge a Will, so it is crucial to seek legal advice immediately if you are contemplating this process.
There are different claims that can be made in relation to a Will. These include:
- Family maintenance
- Lack of testamentary capacity
- Undue influence
- Breach of trust
- Power of attorney
If you have been appointed or named as executor of a deceased person’s estate and you receive notice that someone is challenging the Will, it is necessary to receive prompt legal advice.
How to administer an estate?
An executor is responsible for protecting the assets of a deceased’s estate, dealing with any necessary administration (such as unpaid debts or incomplete business transactions) and distributing the estate according to the Will.
There are a number of things an executor should do upon being named:
- Notify government agencies and other institutions about the death so liabilities do not continue and any necessary income (such as pensions) is stopped
- Confirm all of the assets and liabilities of the estate. This involves writing to financial institutions, government agencies, relevant companies, searching records (Land Titles Office) and preparing an inventory of household furniture and personal effects.
- Apply for a Grant of Probate from the Supreme Court to administer the estate. This document legally authorises the executor to deal with all matters relating to the estate.
When probate has been granted, the executor must lodge a final tax return on the behalf of the deceased, redeem bank accounts and investments, sell or transfer any real estate and motor vehicles and pay any liabilities.
Once these matters have been finalised, the executor can distribute the estate to the beneficiaries as outlined in the Will.
Get Legal Advice
Wills and Estates can be a complex area of law. If you or someone you know wants more information or needs help or advice, please contact us on (02) 9963 9800 or contact us via our form. If you would like to prepare your will with us, please fill out the Will Instruction Form and we will contact you.