Half of all Australians do not have a last Will and testament. Even worse, many people have a Will that they have not updated for many years, or has been done with little or no proper advice. Having a loved one pass away is a stressful time in the lives of the family and friends that remain.
The process of dealing with the deceased’s property and testamentary intentions can seem daunting and challenging. This guide will help you understand the decisions you have to make and what formal steps may be required to ensure the deceased’s estate is properly distributed.
Last Will And Testament
This is a document which outlines your testamentary intentions and sets out how you would like your estate to be distributed in the event of your death. It can also outline other wishes, such as:
- The people you wish to be the guardians of your minor children;
- The people you wish to be your executor;
- Any specific gifts (such as family heirlooms); and/or
- Donations to charity.
Your Will appoints one or more persons as your executor. An executor is a specific legal role and is the person responsible for dealing with your estate and ensuring that your wishes are carried out. Therefore, it is important to appoint someone you trust, who is also financially competent and will be able to deal with responsibilities associated with being an executor.
Common Mistakes Made In Dealing With Deceased Estates
Some of the common mistakes made by family members when dealing with a deceased estate include:
Many people think that their Will takes into consideration their superannuation as an asset of their estate. However, this is incorrect and is why having a binding death benefit nomination and/or a reversionary nomination prepared in respect to your member account balance(s) is extremely important, and thereby ensures your superannuation asset is handled according to your instructions.
Selling and dealing with assets before the formal Court process is concluded:
This occurs mostly in situations where the deceased leaves no Will, and there is nothing to dictate who should deal with the estate. Some examples include selling or using the car of the deceased, taking personal property from their homes and withdrawing money from their bank accounts.
Not considering the liabilities of the estate:
Many people forget that people often die with multiple debts and liabilities. These need to be paid out before any payments or transfers are made. It may also take time for creditors to emerge, so it may not be possible to obtain funds quickly after the death.
Finalising taxes of the deceased:
More often than not, a final tax return of the deceased will be required, and perhaps even tax returns on behalf of the estate.
Published 21 December, 2022