Overview to Deceased Estates in Australia

what is a deceased estate and what to do

People don’t often think of the varying ways death will affect their loved ones after they’re gone. Part of the confusion when it comes to different terms, policies, and consequences after a person has died has to do with financial illiteracy.

This article will dive into the term ‘deceased state’ and what it entails, includes, and how it works.

What is a deceased state?

A deceased state can include any set of assets or liabilities that a person has after they die. This is a person’s property that has a set amount of value. Most of the time, these are already stated in a will, entrusted to the people the deceased individual wants as inheritors.

Example of assets in a deceased state

Any deceased state will have several kinds of assets. These can include the deceased person’s bank accounts, any shares they had in a company, superannuation policies, as well as any personal items and belongings, family heirlooms, and furniture much of which will need clearing from the deceased estate before any real estate a person has can be sold or inherited.

How do deceased estates work?

Once a person has passed away, any deceased state they may have is transferred onto their beneficiaries. These are legal personal representatives that the deceased person has assigned in a will and they are the ones who will directly inherit any asset that a person may have been in possession of.

Who manages the deceased estate?

Any person named in a will by the deceased individual will be deemed a person’s executor or an administrator. This is the person who will be responsible for administering a deceased state and will oftentimes ensure that the person’s final wishes are carried out. Among other things, this is also the person who will be in direct contact with any tax, financial, or legal authorities to see out obligations.

Key terms relating to deceased estates

  • Administration. Someone tasked by the Supreme Court to administer any obligations stemming from a deceased estate by a person. Depending on the circumstances, such as if it was granted to the executor or an administrator, they are also known as a ‘probate’.
  • Administrator. If the deceased person never assigned an executor to act upon their will, this person will be assigned and named an administrator.
  • Estate. These are a person’s assets after their passing.
  • Executor. This is a person (or people) named within a will, tasked to administer any matters of a deceased state.
  • Intestacy. These are assets of a person who did not leave a will.
  • Trustee. When a minor is a beneficiary, a trustee is the person appointed to look after their assets until they turn 18.

What happens if you die without a will?

Intestacy occurs in cases where the deceased individual never wrote a will to clear their financial matters. The law in Australia differs from state to state as to the rules of ‘next of kin’ and which assets they can inherit. Most often, the rule of thumb is that a person’s spouse and children inherit most of the deceased state—however, different rules may apply depending on the state and circumstances.

Deceased Estate Administration

  • Reporting the estate. The first step to administering any deceased state is reporting the matter to legal authorities, so they are made aware of the person’s passing.
  • Confirming assets. This is done by an executor or administrator who will ‘confirm’ which assets are available within a deceased individual’s inventory.
  • Dealing with the assets. Done by an executor or administrator, who will see to the assets and any potential liabilities from a person’s deceased state.
  • Paying debts and taxes. Once the assets have been identified and sorted, an executor or administrator will use them to pay off any remaining loans that a person may have had. These include personal loans, mortgages, car loans, or any other loan the person has made.
  • Distributing the estate. Once the estate has been confirmed, any assets and property will be distributed by the executor or administrator. This is also where any unsecured debts will be paid off by remaining funds within the estate.

Deceased estate property sales

If you’re looking to sell any deceased property, the rules and process are very similar to handling regular real estate matters, with a few exceptions.

First and foremost, a transfer of property must be handled through the Supreme Court. An official document will authorise a person to deal with any property matters as per the deceased individual’s wishes. Once that is obtained, the person may seek out a real estate agent or auctioneer for the process.

It’s imperative that the person sells and handles the property as per the instructions of the will.

Depending on the size of the property, there will be a need to pay off taxes at the end of the financial year.

Conclusion 

Handling a deceased state can be an overwhelming experience for those who have to deal with the matters and policies. However, understanding some basics about what will happen to your assets is key in making the right decision when writing a will and managing your assets.

If you need help clearing a deceased estate including having any rubbish removed and the sale of valuable unwanted items contact us today for a free quote.

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