Including Foreign Assets in Estate Plans

All adults in Australia should have an up-to-date Will in place to ensure that their estate is distributed in accordance with their wishes after they have passed away.

For the majority of Australians, writing a Will is relatively straight forward. However there are times when personal circumstances can make estate planning more complicated, for example where assets are held in more than one country. In Australia, where almost a quarter of residents were born overseas, this situation is more common than people might think.

A recent article in the Australian Financial Review gives a good summary of the complications that can arise when the deceased’s estate includes assets in another country as well as in Australia.

One of the most obvious potential problems is that inheritance laws vary between countries. If a Will has been written in Australia, but some of the assets are in another country, then which country’s laws will apply to their distribution?

This can become even more problematic if the other country’s laws include what the article refers to as “forced heirship”, where certain relatives have automatic inheritance rights. If these rights are contrary to the wishes expressed in the Will then the potential for conflict is immediately apparent. 

Other potential complications include the differing rates of inheritance or death tax that exist overseas and the possibility that these could be applied to Australian assets. In addition, there is the risk that a Will written in Australia won’t be deemed valid in other countries where assets are held.

People who find themselves in this situation should always seek legal advice when writing a Will. Specialist lawyers will be able to alert estate holders to the possible complications and advise on possible solutions, such as preparing separate Wills in each of the different countries where assets are held.

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Szabo & Associates, Solicitors can offer expert advice on a wide range of legal matters, including contesting, making or updating a Will. Please call George Szabo on (02) 9281-5088 or fill in our online contact form.