An increasingly common estate planning issue is how to deal with assets outside Australia. A growing number of Australians are looking at the prospect of having to draw up more than one will.
A will can be drawn up that deals with a will maker’s international assets but it is important to make sure that is the right approach, says Krista Fitzgerald, practice leader in estate planning and probate at law firm Moores.
Fitzgerald says that if the overseas asset is real property it is vital to develop the estate plan in conjunction with a lawyer in that country.
“Real estate assets are governed by the laws of the country in which they are situated, meaning that it will be the law in that country which dictates whether an Australian will is recognised as validly dealing with property held there,” she says.
Where other assets are involved it may be possible to prepare an Australian will so it is recognised as valid in other jurisdictions. “Moveable assets, which generally covers everything except real estate, are governed by the laws of the country in which the will maker is domiciled at death,” Fitzgerald says.
Domicile is determined as the country which the will maker intended to be their long-term home, whether or not they are living there at the time of their death.
She says it is worth checking to International Wills Convention. Signatory countries will recognise an Australian will as validly executed in their jurisdictions.
In some cases the best way to go is to draw up multiple wills, with a will in place in each country in which significant assets are held.
Each will can be made in accordance with the laws of that country and prepared by a lawyer familiar with the succession laws of that country.
“This is particularly important in countries where death taxes apply and where strategies may have to be implemented to minimise the impact of such taxes,” Fitzgerald says.
Another reason for having multiple wills is that the distribution of assets may be dealt with in a more efficient manner as the executors would only need to apply for probate of the will in the country that it was made.
This avoids the need for the probate to be resealed in each country in which the will is required to be proven, which could be time consuming and complicated.
If a decision is made to prepare wills in multiple jurisdictions it will be important to ensure the wills do not revoke each other and that the overseas will is limited to the assets in that jurisdiction.