Wills and Estate Lawyers Adelaide
One of the most important things a person can do is to have a valid Will. Taking the time to make a Will ensures your final wishes are carried out, including what happens to your assets after you die.
Preparing a Will also forms part of a broader Estate Planning strategy. Other considerations include: your current or previous spouse or current domestic partner, children and parenting issues, superannuation and potential tax implications.
Drafting a Will is an activity which requires special skills and an understanding of the potential needs and implications based on your unique circumstances. With a dedicated team of Wills & Estate Planning solicitors, Scammell & Co. provides a knowledgeable and efficient service across the full spectrum of Wills and Estate Planning matters.
Our service areas include:
- Wills and Estate Planning
- Administration of Deceased Estates
- Contested Estates
- Superannuation Claims
- Powers of Attorney
- Advance Care Directives
Scammell & Co. have 6 offices located throughout South Australia including Adelaide CBD, Port Adelaide, Walkerville, Gawler, Renmark and Tanunda. Call or email us today to speak with a highly experienced lawyer about your matter, or to book an appointment at an office convenient to you.
FAQs Click on the questions below to reveal the answer.
What is a Will?
There are technical requirements for the document to be recognised by the Supreme Court as a valid Will. A Scammell & Co. solicitor can help you put in place a Will that complies.
Estate administration is usually undertaken by an Executor. Generally, this person is appointed in the deceased’s Will. If the executor is unable or unwilling to act, or if there is no Will, another person may administer the estate by obtaining a Grant from the Court. Where no one is able or willing to act, the Public Trustee will step in.
If you do not have a valid Will there are rules in place to determine how your estate will be distributed. These are known as the ‘Rules of Intestacy’.
What are the implications of not having a Will?
In the event the person who is deceased has a spouse but no children, the spouse may be entitled to the whole estate of the deceased.
If the deceased leaves both a spouse and children behind, and the children are the biological children of the spouse, the spouse may receive the first $100,000* and the balance of the estate split 50/50 between the spouse and children.
In the event the deceased had multiple spouses, there may be another set of considerations in how the estate is to be distributed.
If the deceased had no spouse, the order in which the estate may be distributed can be as follows: children, parents, brothers or sisters, grandparents, aunts or uncles, and cousins. The question of who is considered a child under statutory law can potentially be far reaching and may include:
- any children conceived through in vitro fertilisation (IVF)
- adopted children, which can also include children adopted by same sex couples
If the deceased has died intestate without any relatives, and there are no relatives closer than second cousins, then the estate will pass onto the State.
* Amount subject to change in accordance with intestacy rules.
Why should I pay someone to make a Will when I can make my own?
Preparing your own Will with the help of a book or internet forms can be a costly mistake. If you do not know and understand the rules regarding Wills and how they apply to your situation, any mistakes will not be discovered until after you die. It is cheaper to ensure that your Will is correct before you die than it is for your executor to fix mistakes after you die, thus adding further costs to your estate.
Why should I consider estate planning?
Scammell & Co. will look at each person’s individual circumstances and then advise on various estate-planning strategies that can be used to give your beneficiaries the ability to:
- Minimise taxes on income earned from their inheritance.
- Retain their inheritance for your descendants only.
- Protect vulnerable or incapacitated beneficiary’s inheritance.
How do I prepare a Will?
Before we meet, it is important to consider the following:
- Who you wish to appoint as your executor
- Who you wish to appoint as the guardian or guardians of your minor children
- What assets and liabilities you have
- How you wish to distribute your assets in the event of your death
How do I change my Will?
- Marriage, divorce or separation from a de facto partner
- The birth of children or grandchildren
- The death of a beneficiary or executor
- A significant change to your financial situation or assets held by you (such as buying a house)
How can I contest a Will?
- The deceased was your parent, guardian or spouse, or you were dependent on them, and they didn’t adequately provide for your maintenance and support.
- The Will is not valid because a). The deceased was not legally or mentally able to make a valid Will or b). The deceased was pressured or threatened to sign a Will.
Are there time limits for contesting a Will in South Australia?
What is a Grant of Probate?
If there is no executor appointed, or the executor is not able or willing to act, another willing person may apply to the Court for a Grant of Letters of Administration. This person could be, for
example, a spouse, de facto spouse, child or next-of-kin.
What are the duties of an executor?
Depending on the nature of the estate, some of the things an executor may be responsible for include:
- Organising a funeral
- Applying to the Court for a Grant of Probate
- Identifying the deceased’s assets and liabilities
- Organising insurance cover for the deceased’s property
- Closing bank accounts
- Selling or transferring the deceased’s house and other property
- Paying any creditors
- Liaising with beneficiaries
- Distributing money and items to beneficiaries
- Taking care of any taxation issues
- Looking after assets or investments left to minors or anyone with a legal disability
- Representing the estate in any litigation
What type of trusts are made in a Will?
There are many different types of Testamentary Trusts and they are used for many different reasons, depending on a family’s individual circumstances.
Some trusts can be very flexible such as primary beneficiary controlled trusts and others that are more restrictive. For example a protective trust which can be established for a beneficiary with a disability or spendthrift who is not able to manage his or her money.
- A disabled person’s trust.
- A spendthrift person’s trust.
- An income maintenance trust.
- A capital protected trust.
- A staggered time release trust.
- A protective trust.
- A beneficiary controlled trust.
- A fixed life interest trust.
- A flexible life interest trust.
What is a Testamentary Trust?
A Trust describes a structure whereby assets are managed by one person (or persons) i.e. a Trustee, for the benefit of others (the beneficiary or beneficiaries).
Under a Testamentary Trust the Trustee has the discretion to distribute capital and income between a group of beneficiaries nominated in your Will.
There is no standard format for a Testamentary Trust and they are adapted to suit the needs of a particular person or family.
What are the benefits of a Testamentary Trust?
1. Flexibility for your beneficiaries
The Trustee may distribute capital and income to any nominated beneficiary at any time and in any proportion. A Testamentary Trust gives the beneficiaries both flexibility and control over when and how they take their inheritance.
2. Protection of assets
The assets form part of a Trust and therefore they cannot be taken out of the Trust without the Trustee agreeing to distribute them to the beneficiaries. None of the assets are legally owned by the beneficiaries which may protect the assets of the Trust in the event of:
- Divorce/relationship breakdown of a beneficiary
- Protection from creditors of a beneficiary
- Beneficiary in a high-risk profession or business where negligence claims are likely
- Will challenges
3. Protection of beneficiaries
A Trust can protect the interests of vulnerable beneficiaries with regards to:
- Social Security entitlements
- Extravagant or wasteful spending habits including gambling/drug addictions
- The diverting of family assets to a new family through remarriage
- Family assets used in risky or unprofitable ventures
- Tax effective allocation of income to Beneficiaries who are either unemployed or under the age of 18 years
How does tax affect my estate?
The way in which your Will is worded can affect the amount of tax that your beneficiaries pay on their inheritance from your estate. This includes Capital Gains Tax on disposal of assets, penalty rate of taxes for underage beneficiaries and also income tax.
How are minors taxed on their inheritances?
A minor beneficiary receiving income from a Trust created in your Will can receive $18,200 per year tax free before paying concessional tax rates as follows:
|Taxable income||Tax on his income|
|0 – $18,200||Nil|
|$18,201 – $37,000||19c for each $1 over $18,200|
|$37,001 – $87,000||$3,572 plus 32.5c for each $1 over $37,000|
|$87,001 – $180,000||$19,822 plus 37c for each $1 over $87,000|
|Above $180,000||$54,232 plus 45c for each $1 over $180,000|
The above benefits, using a Testamentary Trust, can be contrasted with the much higher rates which apply to a minor beneficiary under a trust not arising from a Will. Those rates are as follows:
|Taxable income||Tax on his income|
|0 – $416||Nil tax|
|$417 to $1,307||66% on amounts from $416 to $1,307|
|Over $1,307||45% of the total amount|
Why might it be better not to leave assets directly to a child or children of adult age?
The answer is the example of Mrs Smith who was adamant that she wanted a simple Will that left the whole of her estate equally to her three adult children James, Alison and Beth. After her death the results were not what Mrs Smith would have wanted.
A1. James was a high income earner and when he invested his inheritance this resulted in his annual income being subject to the highest tax rate of 45%. He used the remaining 55% of the income to pay maintenance for his two families. The maintenance was paid in ‘after tax’ dollars.
James would have preferred to be given the option to establish a Testamentary Trust with his inheritance so that he could distribute $54,000 of the income to his wife and children tax free and then pay the concessional tax rates.
James owned his own company and ran the risk of being sued personally through his line of work. If his inheritance was in a Testamentary Trust the assets may have been protected from claims if he was ever sued.
James died a few years after his mother and his widow, Josie, remarried Robert. When Josie died, Robert successfully contested Josie’s Will. The result is that Mrs Smith’s estate eventually ended up with Robert’s family, not Mrs Smith’s own grandchildren.
If James’s inheritance was in a Testamentary Trust then on his death his inheritance could have stayed in the Trust and when Josie died her new husband would not have been able to make a claim. Instead, the inheritance would have gone directly to Mrs Smith’s grandchildren rather than to Josie’s new husband.
A2. Alison and her husband are divorced. During her marriage Alison had nothing to do with her husband’s business but she had signed a personal guarantee to the bank. The divorce did not discharge her from the bank guarantee, and she did not get advice from a family lawyer at the time of the divorce. Alison was relying on her inheritance from her mother to raise her two minor children. Alison’s former husband’s business was in financial difficulty and her ex-husband’s creditors received the whole of Alison’s share in her mother’s estate. None of the estate benefited Alison or her children.
A3. Beth is unemployed and a compulsive gambler. A Protective Trust would have ensured that Beth’s inheritance would benefit her rather than being lost to the casino and poker machines.
Is it more expensive to make my Will using a solicitor, when compared with using a Trustee Company?
No, in fact the opposite is the case. A Trustee Company will prepare your Will for no charge or a minimal charge if you appoint it to be your Executor. After you die, the Trustee Company charges commission on the gross value of your estate (not the net value). For example, if you own a house valued at $400,000 with a mortgage of $300,000 the commission charged by the Trustee Company is on the value of $400,000 and can be as much as 8% of the gross value.
Also, your beneficiaries have no choice in the administration of your estate, and if unhappy with the Trustee Company they cannot remove the Trustee Company and appoint another Trustee Company.
What is wrong with completing a will kit?
Will kits are designed to cover only the most basic circumstances and will kits do not always comply with South Australian laws and provide for variations in people’s circumstances. There is no personal attention or advice on the legal consequences of certain estate planning choices. They do not offer the opportunity for beneficiaries to minimise tax, or protect their inheritance against claims by others.
In many cases, when a Will made from a will kit is submitted to the Probate Court, after a person’s death, the Court may require additional documents to be provided before that Will can be proved. The costs of each of these documents is usually in excess of the cost of having a standard Will made by a law firm. The added costs and delays often cause the deceased’s family stress, which could have been avoided.