What is a Legal Will? A legal Will is a document that contains your instructions on how you want your property (including assets such as land, a home, shares, cash etc) to be distributed after you have died.
You need to be eighteen (18) years of age or older. There are some limited cases where a person younger than 18 can make a Will, but in such cases you will need to seek expert legal advice.
The making of a Will ensures that your assets pass to the people of your choice. If you die without a Will, your assets will usually be divided according to the intestacy laws in your State. The result of this is the following:
Yes, a Will must be in writing to be legal and enforceable. It can be typed or handwritten, but it must be legible.
A Will can be cancelled or revoked at any time. In fact, you should read your Will at least once every couple of years to make sure that it does not need updating. To update your Will requires you to make a new Will which cancels or revokes your old Will. You can also revoke your Will by burning or otherwise destroying the document with the intention of revoking it.
When you get married, your Will is automatically revoked.
Except in the Northern Territory and Western Australia, divorce will either revoke your Will or will nullify the clauses of your Will that relate in any way to the benefits which your spouse was to receive. Separation will NOT revoke your Will. In either case, it is advisable to write a new Will immediately.
The ending of a de facto relationship will NOT revoke your Will. If you are living in a de facto relationship, and you die without a Will, then your de facto spouse must have been living with you for 2 to 5 years (depending on the State or Territory) for them to benefit, whereas a married person would have an immediate interest.
As you go through life, your circumstances change. Your relationships with people alter, your assets change, and you may have children. Your Will needs to appropriately reflect your current circumstances.
For example, some events that would make you want to reconsider your Will include
the following:
The simplest way to change your Will is to write a new one. You may also amend your Will by adding pages. Each page must be signed and witnessed in the same way as your original Will. These additions are called codicils and must be kept with the original Will.
While you have a spouse, it is wise for you both to have “mirror” Wills (i.e., one for each person on exactly the same terms). This way, if there is an accident involving both of you, the Wills are consistent.
A Power of Attorney is a document that you sign that gives another person the ability to make decisions and do things in your name on your behalf during your lifetime.
Once you die:
Jointly owned assets are assets that would not be covered by your Will. The reason for this is that the title to the asset automatically passes to the second person when the first person passes away.
For example, suppose you have a joint account with your brother. You each put $500 into that account. You want your $500 in your Will to go to your spouse. Because it is a jointly owned asset, there is what is called “a right of survivorship” that goes with that joint ownership. On your death the $500 vests automatically to your brother. As far as your Will is concerned, it is as though you did not own that $500 at the date of your death. That gift in the Will is very likely to fail. Similarly, if the brother died, his $500 would vest in you no matter what his Will stated.
Other assets may also be jointly owned. For example, household goods and furniture are often jointly owned with your spouse.
If you co-own a house or a real estate with another person, the title will spell out whether you own as joint proprietors (also called in some cases “joint tenants”) or as tenants in common. If you are registered as joint proprietors, it is exactly the same as the bank account situation already described. No matter what you put in your Will your share will go to the other co-owner. If, on the other hand, you are registered as tenants in common, then your share will be governed by your Will and you can leave it to whomever you choose.,
Another type of asset that your Will does not automatically govern is your superannuation.
The rules governing most superannuation funds provide that the fund has the discretion to decide where it pays your accumulated superannuation benefits. The fund may pay it to one or more of the following:
Most superannuation funds allow you to direct how you want the fund benefit to be paid. This requires you to fill out “a nomination form”.
As in the case of superannuation, unless there is a specific person or persons nominated as the beneficiary(s), for example your spouse, the money will be paid to your estate and will be subject to your Will. If there is a specific nomination, then the money will be paid directly to that person.
If you have significant assets, you should consider the effect of capital gains tax on your estate. You should obtain specialist legal advice in relation to capital gains tax.
In general, when the executor or beneficiary disposes of an asset that they received from a deceased estate, then they may have to pay tax on the capital gain if that asset was acquired on or after 20 September 1985.
AussieLegal offers a range of estate planning products, which includes a DIY Will Kit, which allows you to create your own will. We also offer a Legal Will preparation service, wherein one of our experienced paralegals will prepare your Will for you. If you prefer to have an experienced family lawyer assist you with your Will, then our Legal Will Plus service is the one you need. We also offer a Binding Mutual Wills preparation service for individuals entering into their second marriage.
Call us on 1300 728 200 to discuss your situation with one of our consultants.
