Why Is a Will Important?
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January 14 2017
When drafting a will, you need to consider the nature and extent of what you own. However, sometimes what is ‘yours’ is not so straightforward.
In the case of property that is held in the name of a company with which you have an involvement, such property is not directly yours, and accordingly cannot be dealt with pursuant to the terms of your will. Instead, such property is owned by the company, and will be dealt with in accordance with the company’s governance and management rules.
While you may not own company property directly, you may have control over such property by virtue of being a company director. As a company’s directors are elected by its shareholders, and as shares in a company are personal property, gifting your shares via your will may be the key to passing on control of the company’s property to your intended beneficiary.
In the case of your superannuation, you do not presently own the property in your super fund. Instead, such property is presently held by the trustee of the fund on trust for your future benefit.
Therefore, a death benefit paid out by a super fund on your death does not automatically become part of your estate. Instead, the benefit will be distributed by the trustee of your super fund in accordance with one or more of superannuation law, the fund’s rules, any binding directions that you have made, or possibly the trustee’s discretion.
A death benefit may be distributed by a super fund directly to a beneficiary, such as your spouse or children. The benefit will only become a part of your estate, and hence able to be dealt with pursuant to the terms of your will, if it is specifically paid by the trustee of your super fund to your estate.
Disclaimer: This document provides general information and is not legal advice. While we endeavour to ensure the information is correct at the date of publication, laws frequently change. If anything in this post is relevant to you, please contact us for advice on your specific situation