Dealing with assets in Australia is complex. There is no set statutory limit for probate; rather, it is up to the company, bank, titles offices or other institutions as to their individual requirements. This is further complicated by the fact that each institution may have different requirements for different states.
The following is a basic synopsis of the requirements. I must stress that these are the standard requirements and are subject to constant change at the whim of the institutions involved. Unless specifically stated, reference to probate, refers also to a reseal of a foreign grant.
Shares
Generally you can deal with shares without probate when the value of a particular holding is under A$15,000 (with the exception of Computershare which has a higher threshold of A$50,000). There are some further anomalies for particular companies which are subject to change from time to time. This isn’t always the case when no overseas probate is available, ie: some registries won’t accept a will and death certificate from overseas no matter how little the value of the shares.
Bank accounts
ANZ has a probate limit of A$80,000 which reduces to A$50,000 for intestacies. Westpac has a limit of A$100,000. CBA and the NAB have limits of A$50,000. The banks can negotiate on these thresholds, but it depends on the actual bank involved. Some requirements will be different at the same bank in different states. Some banks insist on probate being obtained in the state in which the account is held; others insist on probate but are not concerned with where it is obtained in Australia!
Real property (including timeshares)
Most dealings with real property, except where held as joint tenants, require probate to be obtained in the same state as the property is held.
Beware Queensland: In Queensland it’s possible to deal with property with the production of a foreign exemplification (or even the original death certificate and will, although you will not get the original will back). Please be careful getting property dealt with in Queensland – you can spend money unnecessarily!!!
In New South Wales, timeshare interests can be dealt with without a reseal, provided the timeshare’s value is not ‘excessive’.
Managed funds
There are no steadfast rules with any of the fund managers in Australia. However, a good guide to use is the same as for shareholdings. For transfers of unlisted units, stamp duty is still assessable in some states.
Superannuation
Superannuation in Australia is compulsory for most workers; with these schemes most employees also have a death benefit insurance cover. Superannuation is mostly covered by federal legislation and is intended to provide retirement benefits to the contributor or their dependents if they die before retiring. Therefore it’s essential to ascertain from the deceased’s superannuation fund to whom they intend to pay the benefit.
Superannuation funds will always avoid paying the funds to the estate if they can. Generally they try to pay financial dependents or ‘interdependents’, which can be people other than who we may consider normal dependents of young children or spouses. Interdependents can include people living together who are not spouses or children, ie, siblings or even flat-mates who provide financial support for each other.[Jo thought this needed a bit of clarification. Unfortunately I’m no help because I know nothing about this topic.]
If there are no dependents then an Australian grant is required. It generally does not matter in which state the grant is obtained. If the deceased’s superannuation is paid to the estate there are various taxation complications that arise, including the possible withholding of up to 30% from the payout to non-financial dependents.
Where to obtain a grant?
Real property is the only asset that requires probate to be obtained in the same state as where the property is located. Some banks will insist on the probate being obtained in the state in which the account is held. When dealing with shares or managed funds that require probate a grant can be obtained in any state, provided a separate declaration is lodged with the company signed by the executor confirming probate is not being obtained elsewhere. This declaration complies with the Commonwealth Corporations Act; however, interestingly, it does not provide any indemnity or protection for the company or institution concerned!
To further confuse this issue, all Australian states have different probate procedures. Each state has a different fee structure, often scaled to the asset value. Further, some states require details of all worldwide assets and liabilities, details of all beneficiary names, addresses and birth dates. These rules are often based upon outdated legislation which has been superseded but, typical of the departments involved, their internal rules have not kept up with the legislative amendments. A good example is the asset detail requirement which was useful when death duties existed but would be generally irrelevant to the registrars now.
Please also note that assets held in South Australia should always be avoided. That state is very complex and costly when obtaining a grant. If you know of clients with assets there please review them before it is too late.
Unclaimed/lost money
Many people receive offers of assistance to claim funds that have been found and may belong to them. These funds are discovered by certain money-finding organisations that scour the government gazettes and then hope to hit the big time with fees of up to 25% of the funds claimed.
Basically, unpaid company dividends (except for bank dividends) are paid over to the state governments. Company takeover proceeds, bank deposits and bank dividends are paid to the Commonwealth Government. When paid, the amounts are advertised and become public knowledge. If you or a client get a letter like this you can search the government’s online facilities (contact me for the websites or Google them – there are at least eight). Once found you can lodge the claims directly.
If this sounds like hard work, you can go through my office at only 5% with a minimum of $500. Do your research first as there may be more money available than you think!
AML/CFT legislation
In recent years Australian governments have implemented complex AML rules which have mostly been adopted by all institutions here. In nearly all dealings with Australian institutions verification of an individual’s Identification is required. In general terms this is not too onerous. However, many legal executives would have come across requests to prove the identity for transferors on Australian shareholdings and to pay a fee for the privilege of being identified! According to the registries this is more about fraud prevention than AML requirements. [Jo’s comment about this last sentence inthe para was that AML IS about fraud.]
It is interesting to note that when lodging a number of share transfers at the same time with the same person being identified, then only one fee is payable. If, however, you are lodging transfers over consecutive weeks or months for the same person, then a separate fee is payable each time!!
What should you do when assets are discovered in Australia?
Naturally I suggest you contact me for assistance. However, my first advice is to ensure you have all details of all assets held. Secondly, don’t take it as read that you have to do what the company or issuer has advised. If you think the value of the asset is borderline around the limits we’ve mentioned above, make a special request to the company to waive their probate requirements in that instance. Finally, contact me for assistance!