If you’re the executor of a loved one’s estate, your role will almost certainly involve distributing assets, as well as possibly paying debts or overseeing the sale of property or other belongings. But there are a number of steps required by law before you start dealing with the deceased’s finances, and in some situations that means obtaining a grant of probate – a tricky topic for anyone not deeply involved in the estate management sector.
The simplest explanation is that probate being granted mean that the Supreme Court has recognised that a will is legally valid. The grant is the court’s document that recognises a person is authorised to deal with the estate of the deceased.
In some cases, executors may require a grant of probate before they can administer an estate, often because the deceased has left a large amount of money or shares that must be released by a financial institution to the executor for distribution. Banks and other finance providers may request probate before undertaking such a transaction and each institution will be able to advise if the size of transaction is one that requires probate.
Probate may also be needed if, for example, the will has been contested or if the deceased’s real estate is being transferred to a beneficiary. However, the rules on which specific instances require probate differ from state-to-state. So here’s a quick guide to the circumstances in which probate may or may not be required in your location. Don’t forget, though, that it’s important to seek professional legal advice to confirm the facts in your personal situation.
It’s always wise to ask the relevant financial institution whether you need a grant of probate to request a financial transaction, because one may not be required if the sum involved is relatively small. Other instances in which probate may not necessary is when the deceased’s property is being transferred to a beneficiary named in the will, when the executor has to undertake the sale of real estate on behalf of the estate and when an asset, such as the family home, is held in joint names.
In NSW, there’s no statutory requirement for probate to be obtained in every case but it is required in some instances. As such, it’s wise for the executor ask asset-holders such as banks whether they require probate to permit the transfer of assets – just as is advisable in Queensland.
Probate isn’t required if assets are jointly held with a person who has survived the deceased. However, if real estate, for example, was held solely by the deceased or a share of the real estate was held by the deceased as a tenant-in-common with another individual, a grant of probate will be required in order for the estate to be able to handle the property.
The proceeds of life insurance and superannuation generally don’t form part of an estate (unless, for example, the estate has been named as a binding nominee that should benefit from the superannuation balance), however it depends on the terms of relevant policies and the nature of super nominations. In some cases, the insurance or super trustee may require a grant of probate to be made or resealed before determining who’s entitled to the insurance proceeds or super balance.
Under Victorian jurisdiction, estates are often administered without a grant of probate, with banks and insurance companies releasing funds without probate if the value of the funds are low and there are no undue complications to the will. However, if an executor is required to prove their title to assets of the deceased, in Victoria probate is then required.
If the deceased owned real estate either solely or as a tenant-in-common, probate is always required. But if assets were jointly held, a death certificate should be enough to transfer funds to the surviving joint holder, although an application to the Land Titles Office will be needed to transfer property.
Super trustees will often pay funds directly to a nominee, however if the deceased’s nomination is invalid, they may choose to transfer to a specific person or the deceased legal’s representative. In such cases, the executor will need to contact the super fund to understand the terms of release.
While a grant is not legally required in every case in SA, some organisation will require probate to release funds, while others won’t require probate. Again, banks and insurance companies may release funds if the amount involved is relatively low and there are no complications so, as before, it’s wise to ascertain each organisation or institution’s specific requirements.
Property owned solely by the deceased or as a tenant-in-common will require probate before being transferred, while that which is jointly owned requires only a death certificate before being transferred to the surviving owner.
As in Victoria, super trustees will often pay funds directly to a nominee, however if the deceased’s nomination is invalid, they may choose to transfer to a specific person or the deceased legal’s representative. In such cases, the executor will need to contact the super fund to understand the terms of release.
In the ACT, when the deceased was the sole owner of land or with another person as a tenant-in-common, probate is required. However, as in the states, other institutions such as banks and share registries will have their own thresholds for requiring probate. Non-estate assets such as property owned as joint tenants, super and life insurance don’t require probate where a binding nominee has been named.
In most cases, probate is necessary to administer an estate in Tasmania, particularly when dealing with large sums of money, valuable items that aren’t personal goods, shares and trust funds. Probate isn’t usually necessary, however, to deal with assets such as joint bank accounts, insurance payments under the sum of $10,000, real estate owned under joint tenancy, car ownership and personal goods.
In the NT executors generally require a grant of probate to undertake most administration required of the role.
Executors usually need to apply for a grant of probate if the deceased had assets in WA at the time of their death; these assets include bank accounts, shares or real estate in the deceased’s name or if they owned real estate as a tenant-in-common.
If real estate or bank accounts were jointly held, however, probate is unlikely to be required because the assets can be transferred to the surviving party with only a death certificate as proof. Also, if the deceased’s only other assets were personal possessions or their only property (other than personal possessions) was a car or a motor bike, probate isn’t usually required.
IMPORTANT LEGAL INFO This article is of a general nature and FYI only, because it doesn’t take into account your financial or legal situation, objectives or needs. That means it’s not financial product or legal advice and shouldn’t be relied upon as if it is. Before making a financial or legal decision, you should work out if the info is appropriate for your situation and get independent, licensed financial services or legal advice.
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