My husband died from a heart attack alone in the house. He had not made a will. However my son undertook to attend to all the probate details himself! The total cost was only the fees charged by the court (cheaper rate for older folk) and there was never a need for a solicitor. It is not as difficult as one might think and my son found that the clerks who received the paperwork were most willing to sit with him and check that all was in order prior to submission…thus obviating the need to resubmit! We had no problems with the ATO…maybe we were just fortunate but the system worked for me! And dealing with the court from a distance would likely be more difficult.
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It’s good to know it can be done and worked out ok in your instance. It’s also wonderful to have someone reliable to take some of the load in such tragic circumstances.
Grant of Probate or Letters of Administration?
The states all have variations, but in general follow the same key legal principals, when there is no valid will. Legislation may also determine how the estate is to be managed and the beneficiaries. Discretion is largely removed. One example from Qld.
- grant of letters of administration on intestacy—where no valid will was written and the authorised person will be an administrator. The estate is administered according to the intestacy rules.
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I had a valid will, was the only beneficiary, all our accounts were in joint name (including the house). Why would I have needed Probate? By the way, during the Covid-lockdown, we were only allowed to travel up to 5 km for food, etc. I was not even able to collect my husband’s ashes (15 km). The postal service had slowed down and letters took weeks to arrive (even express ones). I still think that an executor should not always have to obtain Probate. Why does the ATO have such a problem identifying a person, who was married for more than fifty years and also had a valid tax file. I still think that the law needs to change. Widows can be without money for many months, if they have to use solicitors.
Probate is a legal process that is sometimes required to validate a deceased person’s will in order for their wishes to be carried out by an executor named in the will. The executor is the person responsible for administering the deceased person’s estate, ensuring debts are paid and remaining assets are distributed (source).
Probate is a critical legal step that is required before an executor can administer a person’s estate and distribute it to the beneficiaries. Simply, it means the court issues a document confirming that the will is valid. (source)
Depending on the state where one lives, probate is an important step as it is legal recognition that a will exists and can be lawfully executed. There are many people who have incomplete, illegitimate wills or invalid wills which can’t be legally executed. There are others who have no wills whereby the estate on death is dealt with using a different process.
The ATO possibly wants to confirm that the instructions provided for in the will are legal and from a will that can be lawfully executed. This is possibly reasonable as they don’t want to be in a position at a later date to be challenged that they did something under a incomplete, illegitimate wills or invalid will.
While one may think a will is valid and probate is not needed, a will is a legal document and in many States possibly requires a step in the process to ensure that it is valid and can be lawfully executed. Unfortunately a layperson can’t determine such or have the opinion that the will is valid. Such can only be determined by a legal process, called probate.
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You make it sound as if there is no choice but to go through the process of probate. That is not the case in NSW at least.
These details are mainly of interest to those who are named as executors and I strongly recommend that if you are such then you should do your own research into what your legal, rights, duties and options may be. Legally you may or may not need to go through probate, it depends on the circumstances. You may or may not have the ability to reasonably conclude what your next step ought to be. It may be that you do need the help of a professional but do not assume that automatically you must engage a solicitor without first doing some study as they will happily take your money and will probably not say that you could have done it yourself if that is the case.
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I indicated above that
One needs to check with the state and also those involved with its execution (such as the ATO, share registries, financial institutions etc) to determine what steps are required to satisfy the legal processes associated with the execution of the will. One can’t make any assumptions in relation to what may or may not be needed as ‘Unfortunately a layperson can’t determine such or have the opinion that the will is valid.’
I also indicated that:
Probate can’t be used in all cases where there is resolution of a estate after death.
Fair point. Sometimes public servants are limited by whatever the legislation says. I have also definitely encountered situations where it is the administrative choice by public servants to operate in a certain way and hell might freeze over before they would do things differently.
and certainly unheard of for such a request to be granted?
It is important to understand the tax implications of selling an asset and transferring the cash into the beneficiary’s name v. transferring the asset (although, off the top of my head, I think most of the time you lose and the taxman wins, no matter how you do it). As always, these things are not made simple so getting professional advice is a good idea.
Then there’s the issue of people who have multiple wills.
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I just wanted to added, we had a valid will, which was drawn up by a solicitor. As I was the only beneficiary, there will be no sale or distribution of assets. Everything was in joint names and I think that the ATO should look at each situation, without such a blanket reliance on Probate. Probate delays an estate and many widows (I know), had to wait a long time for solicitors (who charge lots of money) to finalise the estate and could not get any payments from anybody nor touch bank accounts. As in most cases widows also loose bank-cards, it can be a distressing situation. Under Covid I could not even see a solicitor (nor did I want to). In reality neither a solicitor nor Probate would be necessary in many cases. I still think that executors of estates should be recognized by the ATO and something should be done, so that they are forced to do so.
Our experience is the ATO does. Which is a bit circular a response. The why in your instance it was requested and not in the two I’m most recently familiar with remains unanswered.
In particular one had a sole beneficiary, the surviving partner, with most but not all assets in joint names. The beneficiary had complete access to the funds in all joint accounts. The ATO did not stop the beneficiary from dealing in joint assets. There were shareholding’s in separate names and franking credits to claim. No probate required by the share registry nor the ATO. Equally the partners superfund transferred ownership of the super upon receipt of the requested certified documents.
In the instance of a surviving partner there is a responsibility on the executor to ensure any one dependent whether named beneficiary or not is supported in the interim of final settlement. I understand it is best to seek legal advice in such circumstance, as it may require a court order or similar. It’s no different to the executors responsibility to ensure bills are paid and all assets collected. Perhaps there was a serious failure in the way the will was drafted.
Obtaining a grant of probate may be straightforward as others have advised, or drawn out over years. It’s not evident how the request for a grant of probate by the ATO can leave a widow or partner without access to their personal funds, or any funds and assets held in joint names. The advice I’ve previously received is all joint assets where there is at least one surviving owner are Not Part of the Estate. Perhaps there is an exception? It seems a common understanding. A valid will cannot direct how the surviving partner deals with a joint asset, as it is not part of the estate.
It is also important to consider that asking a solicitor to apply for a grant of probate on your behalf does not require the solicitor to take over administration of the will. For assets held jointly the ownership of the asset passes directly to the surviving joint owner/s. In another estate where there were multiple joint owners of some other assets and separate individual assignments within the estate. Probate was only triggered by an interstate share registry where the holding exceeded their value limit. Even before probate was granted the lands title office accepted the certified copy of the death certificate as did the financial institutions to amend ownership of jointly held assets by deleting the deceased from the title. No wills or probate required. Even the super fund forwarded the full balance to the immediate family independent of the will (as is their right).
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Correct. Superannuation is outside the will process and has its own set of proofs, probate not required.
Sounds very strange to have no access to joint accounts unless the account wasn’t truly joint ie the beneficiary had only a supplementary card.
Seriously in a simple will a lawyer is not required if you are the only beneficiary and executor. Probate is not difficult if there are no other claimants. The forms are available on line.
Also there are step by step instructions. My husband died during Covid. No need to see a lawyer face to face if you want one to prepare the papers. Online conversations is fine. You will require a JP to witness documents and they are readily available. I know this. I am one.
The ATO staff in the estates area are empathetic human beings who were very helpful as are the banks estate areas. People generally really do try to help.
As for tax implications on share transfers, it’s not an issue if you just have shares transferred directly to the beneficiary rather selling the asset
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I understand that Superannuation payouts in the case of death require a “binding nomination” if you want to direct with absolute control who your beneficiaries are.
A “non-binding nomination” means your wishes will be considered but are non-binding on the Trustee of the fund. This means they can determine which beneficiary receives what.
A binding one must be renewed every 3 years.
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I think that info may be out of date, or perhaps restricted by one or more particular superannuation managers.
A binding nomination can be lapsing (renew every 3 years) or non-lapsing.
I’ve had a binding lapsing nomination in favour of my spouse for many years. Then suddenly the most recent time it came up for renewal, I noticed an option on the form for “non-lapsing”. I seized on that - because when the time comes for this all to be relevant the one thing that I won’t be saying is: I wish I had spent more time in my life filling out stupid forms. 
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Likely that option. One example.
Current advice per Mine Super. No option for non-lapsing.
Perhaps the risks in individuals circumstances changing - EG relationships, expose the Super Fund to issues if the ‘Ex’ is still the nominated recipient?
I have always specified “my estate” as the beneficiary in my super in the expectation that the super trustee would hand over the money to the executer of my will.
But I have never seen a definitive explanation that this is binding, and would be followed. Thoughts others?
It requires a nomination that is binding
ATO Advice:
"If a deceased person did not make a nomination (or it is a non-binding nomination), the trustee of the fund may:
- use their discretion to decide which dependant or dependants the death benefit is paid to
- make a payment to the deceased’s legal personal representative (executor of the deceased estate) for distribution according to the instructions in the deceased’s will.
If a non-binding nomination was made by the deceased, the trustee of the fund may:
- use their discretion to pay in accordance with the non-binding nomination
- make a payment to the deceased’s legal personal representative (executor of the deceased estate) for distribution according to the instructions in the deceased’s will."
Note the use of the word “may”, the Trustee has discretion as to distribution.
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A binding nomination is usually valid for 3 years and non-lapsing are the exception. Most Super Funds do not have Trust Deeds that provide for non-lapsing. Reasons are a few but mostly centre around that a person’s circumstances often change and many forget to update regularly. Binding nominations that expire every 3 years at least allows the person to be reminded of the need to update.
A binding nomination is much like a Will in format ie it requires 2 Witnesses to the signature of the person and a signed Witness Statement.
"
How to make a valid binding death benefit nomination
To make a valid nomination you must follow the procedures explained below.
The nomination must:
- be made to the trustee in writing and clearly set out the proportion of the benefit to be paid to each person nominated. It may also include the type of benefit payment (such as a lump sum and/or an income stream)
- be signed by the member in the presence of two witnesses over 18 years of age and who are not nominated as beneficiaries
- contain a signed witness declaration
- be sent to the trustee (a nomination will not be valid until it’s received by the trustee).
Once you have made the nomination, it will be valid for three years from the date it was signed, or non-lapsing depending on the superannuation trust deed options. You can renew, change, update or revoke a nomination at any time.
If the nomination is valid, the trustee must follow it, even if your circumstances have changed. For example, if you nominate your spouse and you separate, but have not yet obtained a divorce, the nomination remains valid and binds the trustee unless the nomination has been amended, revoked or has expired.
When binding nominations may not be appropriate
As binding nominations require a formal nomination, much like a Will, and must be renewed every three years, or whenever your circumstances change, they may not be suitable for everyone. If certainty already exists, for example, where there is a sole dependant, a binding death nomination may be of little value.
Additionally, unless the person you nominate to receive your super death benefit is a dependant or your LPR at the date of your death, a binding death benefit nomination will not be valid. When a person does not meet these requirements, alternative estate planning arrangements will need to be made.
What about non-binding nominations?
A non-binding nomination, on the other hand, gives the trustee discretion to protect the interests of your beneficiaries if circumstances change. For example, if one of your beneficiaries is bankrupt, the trustee can take this into account and avoid putting your super benefit into the hands of creditors instead of your beneficiaries."
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To some extent that would be soooooo much more convenient. Right? Why would I want two different documents with two different treatments? Why didn’t the government just legislate that from day dot?
I don’t have an answer for that but one complication is people who are on a Defined Benefits plan. Only certain people can continue to get your super pension after you die in that case. But let’s say you are on an Accumulation plan (the norm). Then I don’t know why.
(Not being a lawyer but…) A binding nomination is only binding if it is “valid” and it is only “valid” if the beneficiary falls into one or more classes of person. However I believe that your estate would be “valid” and hence the nomination would be “binding”.
Yes but a) in that case why wouldn’t a will likewise expire after 3 years? b) wills are automatically voided in certain circumstances and those circumstances could likewise apply to your binding non-lapsing nomination.
I totally get the point you are making though.
To some extent it depends on how much you want to take responsibility for organising your own life and how much you want the government to do your thinking for you.
Anyway Merry Christmas to everyone and hopefully we are still alive and kicking after Christmas / New Year and hence not directly having to worry about wills and binding nominations. 
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