How to stop someone from contesting a will in Australia?
In Australia, we can decide who inherits our assets when we pass away.
This is known as ‘testamentary freedom’. But what if someone feels left out or thinks a will is unfair? The law allows them to contest it. While this offers protection, it can also lead to complications.
This article explores how to reduce the chances of a will being contested and how to make sure your wishes are respected.
Importance of Testamentary Freedom
Testamentary freedom is a cherished principle in Australia. It’s the right of every individual to determine how their assets should be divided upon their passing.
At its core, it embodies our autonomy and personal choices, ensuring that our work benefits those we care about most. However, it’s not an absolute right.
While we can distribute our wealth as we see fit, potential beneficiaries also have rights. The law seeks to strike a balance, ensuring that while individuals can express their last wishes, those potentially left behind are not unfairly treated or disadvantaged.
This delicate balance ensures the testator’s wishes are honoured, and potential beneficiaries are protected.
Strategies to Minimize Chances of a Will Contest
Inter vivos Transfer of Assets
A proactive step in estate planning involves transferring assets while still alive, known as an “inter vivos” transfer. Gifting assets before death can significantly reduce the estate’s value, limiting what can be contested. Importantly, when a person dies with minimal assets, there’s less allure for potential claimants to challenge the will.
Strategic Ownership Arrangements
Property ownership isn’t just about whose name is on the deed; it plays a pivotal role in estate planning. Two key concepts are “joint tenants” and “tenants in common.”
While joint tenants ensure that property automatically goes to the surviving owner upon death, tenants in common allow for individual shares, which can be bequeathed as desired in a will.
Also read: Who Can Contest A Will Qld: Everything You Need to Know
Life Insurance Arrangements
Life insurance is more than just a financial safety net—it can be a strategic tool in estate planning.
By nominating a direct beneficiary, one ensures that the life insurance payout doesn’t become a part of the contestable estate.
This move provides financial security to the designated beneficiary without legal tussles.
Restructure Asset Ownership
Trusts are complex but invaluable tools in the world of estate planning.
Assets given to a trustee during one’s lifetime are not part of their estate upon death unless specified otherwise. This creates an extra layer of protection against potential will disputes, as those assets are effectively “ring-fenced” from contestation.
Superannuation and Binding Death Benefit Nomination
Navigating the intricacies of superannuation laws is a task for experts. However, the crux lies in how superannuation benefits are handled upon death. By leveraging a Binding Death Benefit Nomination, individuals can dictate where their superannuation benefits go, ensuring they remain outside the grasp of would-be estate challengers.
Also read: Why Make A Will If It Can Be Contested: Protect Your Assets
Structuring Assets to Minimise Disputes
While the strategies mentioned are pivotal, a holistic approach also considers joint ownership and gifting as potential solutions.
Jointly owned assets bypass the estate, and gifted assets can’t be contested if no longer held. This dual-pronged approach ensures that a testator’s wishes are respected while allowing them to see their beneficiaries’ benefits in real time.
The Prosaic Approach
When planning a will, it’s best to think and fairly. This method encourages writers to ask: “What would any reasonable person do in my shoes?”
Disputes can be minimised by keeping clear records of why confident choices are made in a will. It’s about being open and fair and reducing surprises that could lead to disagreements later.
Remember, it’s easier to prevent disputes by being straightforward.
Potential Pitfalls and Considerations
| Action/Strategy | Potential Pitfall |
| Gifting assets | Taxation implications: Gifting assets might trigger capital gains tax or other related levies, depending on the nature of the asset and the jurisdiction. It’s important to consider any potential tax liabilities before making a significant gift. |
| Restructuring assets | Unforeseen tax consequences: Restructuring, primarily through complex arrangements like trusts, can have various tax implications. Understanding these changes and how they might affect both the giver and the receiver is crucial. |
| Transferring assets during a lifetime | Impact on income support benefits: Transferring significant assets can sometimes affect government benefits or support eligibility. Before making large transfers, one should evaluate how they might influence ongoing financial assistance. |
How To Stop Someone Contesting A Will In Australia
A client approached us at Walker Pender, seeking certainty that his will would be ironclad.
Concerned about potential contestations, he sought measures to solidify his wishes in Australia’s legal landscape.
Our team, leveraging in-depth expertise, guided him through strategic asset structuring and detailed testamentary provisions.
We also emphasised transparent documentation and a clear rationale behind every bequest.
By tailoring estate planning techniques and educating him on the intricacies of Australia’s succession laws, we fortified his will against potential challenges, offering him peace of mind.
Secure Your Legacy with Walker Pender
Are you concerned about potential disputes over your will in Australia?
Take control today.
At Walker Pender, we’re seasoned in crafting resilient estate plans.
Let’s ensure your final wishes stand firm. Reach out now and guarantee your legacy is honoured, free from contestation.
Don’t leave your loved ones in doubt; we’re here to guide and protect them.
