How do I ensure my mum’s will fulfills her wishes?

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Connie is the executor of her mother’s will and has asked YourLifeChoices’ estate planning expert Rod Cunich for guidance. 

Connie: After my dad passed away few years ago, my elderly mum inherited a principal residence, two investment properties and shares (all post-September 1985). 

She plans to share the properties equally with her five children after her death. But two of my siblings are not Australian tax residents. How would this affect the inheritance process? 

She also plans to give the shares and remaining cash to her seven grandchildren, a charity organisation and her local church. However, two grandchildren are also non-Australian residents.  

I am the executor of her Will. Is there anything I can do now to make the process smoother or does she need to change her Will now? 

Answer: Assets left to Australian residents pass across to the beneficiaries without payment of any Capital Gains Tax. The beneficiaries, however, inherit the accrued CGT liability and CGT has to be paid upon sale of the asset. 

Where property (land, shares or any other property that attracts CGT) is passed to a non-resident, however, any accrued CGT liability has to be paid, even if the property isn’t sold. 

If property is sold rather than distributed and CGT paid on sale, any cash that is distributed will be ‘post’ CGT cash.

 

Disclaimer: This information has been provided by Rod Cunich and should be considered general in nature. Seek legal advice before acting on this information.

Rod Cunich is a lawyer with more than 30 years of experience who specialises in estate planning. If you have a question for Rod, simply email it to [email protected]

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