What assets do not form part of an estate?

Published 11 Oct 2016

Author: Gerard Malouf

If you are looking to contest a Will, it is important to know what is excluded. If you believe some assets will form part of an estate, and then they do not, you could be left out to dry.

In response, we have created a list of assets that are excluded from an estate and are thus not applicable to a family provision claim.

1. Jointly owned assets

If owned as joint tenants, property will pass automatically to the other joint owner upon their death. In most cases, this refers to homes, home contents, bank accounts and personal effects.

The exception to this rule are assets owned jointly as ‘tenants in common’. The person’s stake in the property will not go to the other tenant, instead it will form part of the estate and be controlled by their Will.

2. Discretionary trusts

Assets that are structured into discretionary trusts will not become part of your estate. This is due to the legal status of trusts, where ownership is to the trust and the trustee.

3. Life insurance 

When a person signs a life insurance policy, they typically nominate a beneficiary of the policy. This is often the spouse or some other family member of the policy holder.

The proceeds of the life insurance policy are paid directly to the beneficiary and thus do not form part of the deceased’s estate. However, if a person nominates their Will as the beneficiary of the insurance, the proceeds of the policies pass into your estate and are managed by the terms of your Will.

4. Superannuation

Assets held by any superannuation fund tend to pass to a dependent spouse or children. Estates are excluded from the superannuation beneficiaries, unless specifically outlined.

Many of the assets that become an estate can form part of a family provision claim. However, due to the intricate laws of New South Wales, there are a number of elements that are determined on very specific circumstances.

In response, you should make sure you have the right advice on hand when contemplating a claim.

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