Under Western Australian law, if a person dies without a Will the estate is automatically divided between the spouse and any surviving children according to a formula in legislation. If a person dies without a spouse and/or children there are rules that will cover which relatives will inherit.
For example a surviving spouse or de facto partner is entitled to all household chattels included in the intestate estate.
Where there is a surviving spouse or de facto partner and children (there can be many scenarios), then:
- Where the net value of the intestate’s property (excluding household chattels) does not exceed $50,000, the surviving spouse or de facto partner is entitled to the whole of the intestate’s property.
- If the value of the property exceeds $50,000, the surviving spouse or de facto partner is entitled to $50,000 plus one third of the remainder, and children are entitled to the other two-thirds (if a child has died and has had children, those children take their parent’s share in equal proportions).
Basically the point of all this is that your assets may not go to the people you want, and that it might not be the most tax efficient way of passing assets to your beneficiaries.
People should also consider making Binding Beneficiary Nominations on their Life Insurances and also Super funds.