Your Will lays out your wishes regarding administering your estate after you pass away, including appointing executors to look after your estate. So, how can you gift your assets?
Assets that are owned jointly generally pass to the surviving joint owner by the laws of survivorship and do not form part of your estate (e.g. joint bank accounts). This differs from assets that are held as tenants-in-common, where you own the asset with another person/s but in shares (i.e. half each). Then your share forms part of your estate.
Any property solely owned by you, such as bank accounts, shares or superannuation, forms part of your estate. Those assets can be gifted to someone or form part of the residue of your estate. The residue is the balance leftover after your executor pays your debts, expenses, and specific gifts.
If you own shares in a limited company, the executor takes over the shares. They may appoint a new director if required. You can gift the shares or their value in your Will. However, your Will advisor should check if the company constitution or shareholders agreement has rules about the process for transferring or selling shares. The transfer of shares to a beneficiary of a Will does not affect shareholder continuity, so the company can carry forward losses and imputation credits.
Partnerships dissolve upon a person’s death unless there is a Partnership Agreement. A Partnership may be set up formally through an agreement or informally. Unless there is an agreement otherwise, the deceased partner’s share becomes a debt and the estate may share the profits made after the partnership is dissolved or receive interest at a rate of 5% on the estate’s share of the partnership assets. You can include the value of the partnership in your estate and gift it in your Will.
If you have a trust that owns property or other assets, you cannot dispose of those assets within your Will. The assets will be dealt with in accordance with your Trust Deed.
As you acquire or dispose of your assets, review your Will to ensure it still accurately reflects your wishes. We recommend each time you update your Will to supply a list of assets to your Will advisor so they can accurately advise you on the best way to gift them.
Disclaimer: The above information has been kindly provided by Saunders Robinson Brown and is of a general nature only. It does in no way constitute legal advice and readers should contact a law firm for advice relating to their specific circumstances.
