WILLS & ESTATES QUEENSLAND 

FAQ

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  FAQ

DO I NEED ESTATE PLANNING?


  1. What is estate planning?
  2. What is involved in estate planning?
  3. Who needs estate planning?
  4. What is included in my estate?
  5. What is a will?
  6. What is a Trust?
  7. What is probate?
  8. Can I name alternative beneficiaries?
  9. Who should be my executor or trustee?
  10. How should I provide for my minor children?
  11. When does estate planning involve tax planning?
  12. Does the way in which I hold title make a difference?
  13. Are there other ways of leaving property?
  14. What happens if I become unable to care for myself?
  15. Who should help me with my estate planning documents?
  16. How much does estate planning cost?
1. What is estate planning?

Estate planning is a process. It involves people—your family, other individuals and, in some cases, charitable organizations of your choice. It also involves your assets (your property) and the various forms of ownership and title that those assets may take. And it addresses your future needs in case you ever become unable to care for yourself.

Through estate planning, you can determine:

  • How and by whom your assets will be managed for your benefit during your lifetime if you ever become unable to manage them yourself.
  • When and under what circumstances it makes sense to distribute your assets during your lifetime.
  • How and to whom your assets will be distributed after your death.
  • How and by whom your personal care will be managed and how health care decisions will be made during your lifetime if you become unable to care for yourself.
Many people mistakenly think that estate planning only involves the writing of a will. Estate planning, however, can also involve financial, tax, medical and business planning. A will is part of the planning process, but you will need other documents as well to fully address your estate planning needs.

The purpose of this information is to summarize the estate planning process, and illustrate how it can help you meet your goals and objectives. You will discover that estate planning is a dynamic process. Just as people and assets and laws change, it may well be necessary to adjust your estate plan every so often to reflect those changes.


2. What is involved in estate planning?

There are many issues to consider in creating an estate plan. First of all, ask yourself the following questions:

  • What are my assets and what is their approximate value?
  • Whom do I want to receive those assets—and when?
  • Who should manage those assets if I cannot—either during my lifetime or after my death?
  • Who should be responsible for taking care of my minor children if I become unable to care for them myself?
  • Who should make decisions on my behalf concerning my care and welfare if I become unable to care for myself?
  • What do I want done with my remains after I die and where would I want them buried, scattered or otherwise laid to rest?
Once you have some answers to these questions, you are ready to seek advice. We can help you create an estate plan, and advise you on such issues as taxes, title to assets and the management of your estate.


3. Who needs estate planning?

You do—whether your estate is large or small. Either way, you should designate someone to manage your assets and make health care and personal care decisions for you if you ever become unable to do so for yourself.

If your estate is small, you may simply focus on who will receive your assets after your death, and who should manage your estate, pay your last debts and handle the distribution of your assets.

If your estate is large, we will also discuss various ways of preserving your assets for your beneficiaries and of reducing or postponing the amount of capital gains tax which otherwise might be payable after your death.
If you fail to plan ahead, a Court may simply appoint someone to handle your assets and personal care. And your assets will be distributed to your heirs according to a set of rules known as intestate succession.
An estate plan gives you much greater control over who will inherit your assets after your death.


4. What is included in my estate?

All of your assets. This could include assets held in your name alone or jointly with others, assets such as bank accounts, real estate, shares and bonds, and furniture, cars and jewellery.

Your assets may also include life insurance proceeds, superannuation and payments that are due to you (such as a tax refund, outstanding loan or inheritance).

Many people also have assets which they consider are theirs but in reality they may be in a Trust or company and it is therefore necessary to determine how to pass control of such assets even though they are not owned by you. Ensuring that there will be sufficient resources to pay such taxes is another important part of the estate planning process.


5. What is a will?

A will is a traditional legal document which:

  • Names individuals (or charitable organizations) who will receive your assets after your death, either by outright gift or in a trust.
  • Nominates an executor who will be appointed to manage your estate; pay your debts, expenses and taxes; and distribute your estate according to the instructions in your will.
  • Nominates guardians for your minor children.
Most assets in your name alone at your death will be subject to your will. Some exceptions include Companies and Trusts and bank accounts that have designated beneficiaries, life insurance policies, Superannuation and other tax-deferred retirement plans, and some annuities.

Such assets may pass directly to the beneficiaries and would not be included in your will (see #13).
In addition, certain co-owned assets (see #12) would pass directly to the surviving co-owner regardless of any instructions in your will. And assets that have been transferred to a Trust created during your lifetime would be distributed through the trust—not your will.


6. What is a trust?

It is a legal document that can, in some cases, partially substitute for a will. With a trust (also known as an inter vivos trust), some of your assets are put into the trust, and administered for your benefit and the benefit of the beneficiaries.

A trust does not, however, remove all need for a will. Generally, you would still need a will to cover any assets that have not been transferred to or held in the trust.


7. What is probate?

Probate is the granting by the Supreme Court of the right to administer a Will and confirmation that the probated Will is the Will to be administered.

Typically, the executor named in your will would start the process after your death by applying to the Court for a Grant of Probate. Your executor would then take charge of your assets, pay your debts and distribute the rest of your estate to your beneficiaries. If you were to die intestate (that is, without a will), a relative or other interested person could start the process and apply for Letters of Administration.

In such an instance, the court would appoint an administrator to handle your estate. Personal representative is another term used to describe the administrator or executor appointed to handle an estate.


8. Can I name alternative beneficiaries?

Yes. You should consider alternative beneficiaries in the event that your primary beneficiary does not survive you.

And if a beneficiary is too young or too disabled to handle an inheritance, you might consider setting up a trust for his or her benefit under your will.

Once you have decided who should receive your assets, it is very important that you correctly identify those chosen individuals and charitable organizations in your will or trust.

Many organizations have similar names and, in some families, individuals have similar or even identical names. We can help you clarify and appropriately identify your beneficiaries.


9. Who should be my executor or trustee?

That is your decision. You could name your spouse or domestic partner as your executor or trustee. Or you might choose an adult child, another relative, a family friend, a business associate or a professional Trustee. Your executor or trustee does not need any special training. What is most important is that your chosen executor or trustee is organized, prudent, responsible and honest.

Discuss your choice of an executor or trustee with us. There are many issues to consider. For example, will the appointment of one of your adult children hurt his or her relationship with any other siblings? What conflicts of interest would be created if you name a business associate or partner as your executor or trustee? And will the person named as executor or successor trustee have the time, organizational ability and experience to do the job effectively?


10. How should I provide for my minor children?

First of all, in your will, you should nominate a guardian to supervise and care for your child (and to manage the child’s assets) until he or she is 18 years old.

Your nomination of a guardian could avoid a “tug of war” between well-meaning family members and others.
Or you might consider setting up a trust to be held, administered and distributed for the child’s benefit until the child is even older.


11. When does estate planning involve tax planning?

Tax planning is always a consideration in estate planning-particularly capital gains tax. Keep in mind that tax laws often change.

12. Does the way in which I hold title make a difference?

Yes. The nature of your assets and how you hold title to those assets is a critical factor in the estate planning process. Before you take title (or change title) to an asset, you should understand the tax and other consequences of any proposed change. We are happy to assist and advise you.

  • Tenants-in-common. If you own property as tenants in common and one co-tenant (co-owner) dies, that co-tenant’s interest in the property would pass to the beneficiary named in his or her will. This would apply to co-tenants who are married or in a domestic partnership as well as to those who are single.
  • Joint tenancy with right of survivorship. Co-owners (married or not) of a property can also hold title as joint tenants with right of survivorship. If one tenant were to die in such a situation, the property would simply pass to the surviving joint tenant without being affected by the deceased person’s will.
13. Are there other ways of leaving property?

Yes. Certain kinds of assets are transferred directly to the named beneficiaries. Such assets include:

  • Life insurance proceeds.
  • Superannuation
  • Certain “trustee” bank accounts.
  • Certain Trusts
Keep in mind that these beneficiary designations can have significant tax benefits and consequences for your beneficiaries—and must be carefully coordinated with your overall estate plan.


14. What happens if I become unable to care for myself?

You can help determine what will happen by making your own arrangements in advance. Through estate planning, you can choose those who will care for you and your estate if you ever become unable to do so for yourself. Just make sure that your choices are documented in writing.You need to make an Enduring Power of Attorney.

And by setting up an advance health care directive/enduring power of attorney for health care, you can also designate an attorney to make health care decisions for you if you ever become unable to make such decisions.

In addition, this legal document can contain your wishes concerning such matters as life-sustaining treatment and other health care issues and instructions concerning organ donation, disposition of remains and your funeral.


15. Who should help me with my estate planning documents?

  • Can I do it myself? Yes. It is possible for a person to do his or her own estate planning with forms or books obtained at a stationery store or bookstore but it can be very risky and end up with unintended results and taxes. At the very least, a review of such forms can be helpful in preparing you for estate planning. If you review such materials and have any unanswered questions, however, you should seek professional help.
  • Do I need a professional’s help? It is recommended. Wills and trusts are legal documents that should only be prepared by a qualified lawyer. Many other professionals, however, may become involved in the estate planning process. For example, accountants, life insurance salespersons and financial planners,  often participate in the estate planning process. Within their areas of expertise, these professionals can assist you in planning your estate.
16. How much does estate planning cost?

It depends on your individual circumstances and the complexity of documentation and planning required to achieve your goals and objectives.

The costs may vary depending on how much is involved. Generally, the costs will include our time for discussing your estate plan with you, reviewing your documentation such as Company documents, Trust documents, balance sheets and financial documents, loan agreements and for preparing your Will, Testamentary Trust Will, Trust Deed, organising issue of new Shares in Companies if necessary, Enduring Power of Attorney or other necessary legal documents. Once we have spoken to you and ascertained what will be involved we are happy to discuss charging a flat fee.