Wills, Enduring Power of Attorney, Executor advice

Wills/EPOA/Executor

Wills

Preparing a Will is essential

Leaving a clear guide of how you want your assets distributed by your chosen executor(s) is cost-efficient and may avoid lengthy court battles over "Who gets what".

Dying intestate (without a will) means there is no guarantee that your assets will be distributed as you would like them to be.

Making or altering your will is particularly important when life circumstances change. We recommend you review your will every three to five years to ensure that it still reflects your wishes.

For example, it may be necessary to change your will if any of the following occur:

• Marriage
  
• Divorce or separation
  
• You enter a de facto relationship
  
• Birth of children or grandchildren
  
• Death of your executor or a beneficiary
  
• Change in your financial circumstances 
  

It is important to note that your will is revoked or cancelled if you get married, unless it is made in contemplation of marriage. Divorce does not revoke a will, but it does cancel any provision in favour of the former spouse.

A will also gives you the opportunity to name guardians for your children, establish a Trust, or donate to charity through an organisation.

Enduring Power of Attorney

Unlike a general power of attorney, the powers under an Enduring Power of Attorney continue in the event you lose the capacity to make decisions for yourself.

An Enduring Power of Attorney allows you to:

Give your attorney the power to make financial decisions and personal and/or health decisions

• Plan for the unexpected, such as an accident, physical disability or other illness
  
• Set out what actions your attorney/s can perform on your behalf. You can nominate one or more attorneys and say when their power will begin. You can give your attorney/s the authority to make any decision that you could legally make yourself or limit the attorney/s powers to terms set by you.
  

A financial attorney is responsible for all financial matters, including receiving income, paying bills, taxation and contractual issues, investment and financial planning, legal actions or property management.

A Personal/Health Care Attorney may make decisions such as where you live, who you live with, daily issues like diet and dress and giving approval for you to receive certain types of health care.

Why should I make an Enduring Power of Attorney?

You should make an Enduring Power of Attorney if you are 18 years of age or over and have the capacity to understand the nature and effect of the power you are giving to your attorney.

If there comes a time when you are unable to manage your own affairs, it may be too late to make your wishes clear to those who will care for you. The best way to provide peace of mind is to legally appoint someone now to manage your financial and personal/health matters in case in the future, you are unable to do so yourself. You can do this by making an Enduring Power of Attorney.

Executor

An executor’s duty applies equally to an administrator and is detailed in the Administration of Estates Act 1925 and in the Trustee Act 2000.

Administration of Estates Act 1925:

• An executor has a duty to collect and get in the real and personal estate of the deceased and administer it according to law.
  

• An executor must exercise such care and skill as reasonable in the circumstances which includes arranging adequate insurance and can delegate these powers to another person for example a solicitor or a stockbroker. 
  

These Acts variously indicate that the general duties of an executor are to:

• Collect and safeguard assets
  
• Pay the debts of the deceased
  
• Distribute the estate to the beneficiaries 
  

Items which are not part of a deceased’s estate and which therefore do not form part of an executor’s duty include:

• Property held as joint tenants
  
• Property enjoyed as a life tenant
  
• Gifts made in contemplation and conditional on death
  
• Policies written in trust under the Married Woman’s Property Act 1882
  
• Lump sums payable under pension schemes or death in service schemes
  
• Foreign property
  
• Trust property 
  

While there is no set time during which an estate must be resolved, it is generally accepted that one year is reasonable. Excessive periods over and above one year that cannot be justified by unusual circumstances are deemed unreasonable and can lead to legal action being taken by a beneficiary against an executor who may become personally liable for any subsequent losses.

When the assets have been collected, an executor must pay the funeral expenses and all administrative expenses together with the debts and liabilities of the deceased. The executor must also pay any inheritance tax which is due on the value of the estate and will be personally liable if he/she fails to do so.

In addition, provision should be made to ensure the payment of any inheritance tax on lifetime gifts which are initially the responsibility of the recipient who should pay the tax within 12 months of receipt of the gift failing which the executor becomes responsible for payment of the tax.

Help when you need it

The Public Trustee is an organisation that is there to assist with a variety of situations that arise at the end of someone's life. We have provided a link to the Public Trustee website that will answer many of your questions. Tony Hollands Funerals are specialists when it comes to Public Trustee Funerals so if you are in doubt, call our office for assistance.