Navigating Parental Inheritance Claims: A Comprehensive Guide

Disputes among siblings and other family members regarding an inheritance claim in Australia might develop when it comes to sharing the assets of a deceased parent or family member. These disagreements can be highly sentimental and complex, necessitating careful management to protect family connections and achieve a fair distribution of assets.

This website blog will examine several strategies to reduce family inheritance provision claims.

• Make a ‘fair’ will

Suppose you have two children and leave half of your assets to one and half to the other. This scenario eliminates the possibility of one child disputing the will because of an ‘even’ distribution. From the point of view of children, they wish for equality above all else.

However, a ‘fair’ will not require that assets be dispersed equally among children or other beneficiaries. A ‘fair’ will often require a determination of the possible successors who may have a claim against your estate and assessing whether your intended distribution adequately provides for their maintenance and support.

• Spend or gift your assets before you die

A simple strategy is to spend your possessions or give them to others before death. By doing so, the estate has fewer assets for children or family members to fight over. A person might make a gift to a specific individual in anticipation of their death (the legal word is donation mortis causa). This gift is no longer considered part of their estate because the donor no longer legally owns the asset.

Be cautious, however. Australia has special rules that permit ‘notional estate claims’ against the deceased estates. A theoretical estate claim is a claimant’s application to the court to reclaim assets released before the willmaker’s death and return them to the deceased estate. Probate lawyers in WA must supervise it.

Gifting assets before death may appear to be a simple option. However, it may not be practical because it could limit the availability of future or unforeseen payments, such as a nursing facility accommodation bond. Dissatisfied family members may also challenge a gift given before a person’s death on the grounds of undue influence or lack of mental capacity.

• Maintaining a right or interest in your gifted assets

A disadvantage of gifting or distributing assets before the individual’s death is that the particular individual deprives them of the item. However, before giving an asset to a loved one, a person can retain some rights or interests with the help of the best probate lawyer Perth services.

For example, an asset (such as the family home) can be given to a relative on the condition that they pay a rent charge or provide an income. In this case, the individual still benefits from the asset in the form of income.

This money can sustain the individual for the rest of their life. Once the asset is gifted, the legal title will move to the relative, indicating that the asset does not form part of the property and is not susceptible to a claim.

• Place your assets under a family trust

A family trust is an effective way to remove assets from an individual’s property. A family trust is formed when an individual or organisation holds assets for the benefit of others, typically family members.

It is practical to preserve control of the assets while functioning as trustee for the trust. However, the transaction costs connected with transferring real estate or stock to the trust may be a disadvantage. That is why going through the best probate lawyer Perth professional is advantageous.

• Holding your property in a joint tenancy

Transferring property into joint ownership is a straightforward approach to reducing the likelihood of a claim against an estate. Property ownership in a joint tenancy is common among married couples or couples who live together regularly.

A parent can also use joint ownership to transfer property to a child with the assumption that the parent will die first. Notably, joint tenancy differs from a ‘tenancy in common’. For a tenancy in common, the deceased’s portion becomes part of their estate. Again, check your Certificate of Title to determine which one it is.

• Binding death benefit nomination for superannuation

Nowadays, superannuation accounts hold a significant amount of people’s wealth. Superannuation funds are not included in a deceased person’s estate since they are not classified as ‘personal assets’.

As a result, people should consider where their estate proceeds will go once they pass away. A Binding Death Benefit Nomination lets you direct superannuation benefits to certain individuals. The Nomination form will usually expire after three years, demanding ongoing maintenance. A simple online search will often lead you to these forms.

• Life Insurance Policy

If you have a life insurance policy, you can direct any payments to another individual after death. This payment will not be included in a deceased person’s estate. A person must, however, exercise caution if their policy is self-owned. In that instance, the proceeds may be paid to the estate and subject to an inheritance claim lawyers in Perth.

Conclusion

This website blog provides a general explanation of numerous options for reducing a family provision claim. Because each individual’s circumstance is unique, it is recommended that you seek legal counsel from the best probate lawyer Perth to build a personalised estate planning approach.