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If you die without a valid Will, it can be complex and expensive for your loved ones. When this happens, you are considered to have died ‘intestate’.

What happens if you die without a valid Will in Queensland?

There are two common misconceptions when it comes to dying without a Will:

  1. Your estate will automatically pass to the State (Crown).
  2. For a couple with children, that their estate will automatically pass to their surviving spouse.

The Succession Act 1981 (Qld) establishes how your eligible relatives will inherit your estate and in what proportions. What the law says will happen with your estate, may not be what you want.

Having a valid Will ensures you decide who will inherit your estate.

Who is an eligible relative?

The rules of intestacy specify the order of entitlement as to who inherits and in what proportion. The order of who is entitled to inherit is as follows:

  • Surviving spouse, de facto partner or civil partner (“spouse”).
  • Surviving children or grandchildren.
  • Surviving parents of the deceased.
  • Surviving sisters and brothers.
  • Surviving nieces and nephews.
  • Surviving aunts and uncles.
  • Surviving cousins.

If there is no one in the earlier categories to inherit your estate, it goes to the Crown.

Let’s have a look at some examples.

Scenario 1 – surviving spouse and children inside of that relationship

  • Amy is married to Joe.
  • Amy and Joe have 2 children together.
  • Amy dies without a Will.
  • Amy has the following assets:

ASSETS

Assets Value
House – Amy and Joe own as joint tenants $500,000.00
Bank account (everyday banking)– jointly held by Amy and Joe $150,000.00
Shares – in Amy’s name only $300,000.00
Bank account (term deposit) – in Amy’s name only $150,000.00
Superannuation with QSuper– Amy has a binding death benefit nomination to Joe $900,000.00
Total $2,000,000.00

LIABILITIES

Liability Amount Owing
Funeral expenses $15,000.00
Legal costs $10,000.00
Credit card – in Amy’s name solely $5,000.00
Total $30,000.00

What forms part of Amy’s estate?

The only assets that form a part of Amy’s estate are:

Assets Value
Bank account (term deposit) – in Amy’s name only $150,000.00
Shares – in Amy’s name only $300,000.00
Total $450,000.00

The house and everyday bank account do not form part of Amy’s estate, as they are jointly held assets. They automatically pass to the surviving joint owner.

Estate assets ($450,000.00) minus estate liabilities ($30,000.00) means Amy’s net estate value is $420,000.00. This is also called the ‘residue’ of the estate.

What does and does not form part of your estate?

Below is a general non-exhaustive list.

In your estate Out of your estate
  • Property – owned solely by you or your % share if owned as tenants in common
  • Bank accounts held solely by you
  • Shares in a company held solely by you
  • Superannuation – if you do not have a BDBN and the trustee decides all or part of your superannuation and death benefits to your estate
  • Property owned as joint tenants
  • Bank accounts held jointly
  • Life insurance
  • Assets held by companies
  • Assets held in trusts
  • Superannuation – if you have a current BDBN in place

Distribution

In scenario 1, Amy has one surviving spouse (Joe) and two children of their relationship (Nicholas and Bianca). Under the Queensland rules of intestacy, Amy’s estate would be distributed as follows:

Joe Nicholas Bianca
  • $150,000.00
  • Amy’s personal chattels
  • 1/3 of the residue ($90,000.00)
  • 1/3 of the residue ($90,000.00)
  • 1/3 of the residue ($90,000.00)

Scenario 2 – Surviving spouse and children outside of that relationship

What would happen in the above scenario if Amy died but Amy and Joe did not have children together. Instead, they each have children to a previous relationship?

Let’s say:

  • Amy has two children – Amber and Alexandra.
  • Joe has two children – James and Jesse.

Distribution

In this scenario, James and Jesse would not be entitled under the intestacy laws to receive any part of Amy’s estate. In Queensland, a stepchild is not considered a child of a deceased for intestacy purposes. Adopted children are recognised for intestacy purposes.

For scenario 2, Amy’s estate would be distributed as follows:

Joe Amber Alexandra
  • $150,000.00
  • Amy’s personal chattels
  • 1/3 of the residue ($90,000.00)
  • 1/3 of the residue ($90,000.00)
  • 1/3 of the residue ($90,000.00)

It is important to note that a stepchild is considered an eligible person to make a family provision claim. See our article Contesting a Will (part 1).

Why you need a Will

Having a valid Will in place is important to ensure the assets you have worked hard to build up during your lifetime, are passed on in the way you want. It also prevents additional stress being placed on your loved ones when you die.

A Will is not the only important thing to have in place. Estate planning involves more than just simply having a document in place that passes your assets on when you die.

Talk to us about your estate planning.

* The above information is a general guide only and does not represent legal advice.