TREATMENT, PROTECTION AND CONTROL OF OVERSEAS ASSETS ON DEATH
It is not uncommon for deceased estates to have assets that are owned within and outside of Australia.
For assets owned within Australia, the executor may apply for a grant of probate at the Supreme Court of New South Wales to allow the executor to deal with, and distribute, those assets.
On the other hand, assets that are located outside of Australia may pose difficulties to the executors or beneficiaries under the estate.
In assessing the assets held outside of Australia, such assets fall under two categories:
- Moveable Assets – such as bank, shares, artwork etc, for which the law of domicile applies; and
- Non-Moveable Assets – such as real estate, for which the law of the land where the asset sits applies.
Domicile law mean the laws of a country where the deceased has treated as their permanent residence, lives in or has substantial connection with. A person may be deemed as a resident for domicile law purposes if that person resided at a country for at least six (6) months prior to their passing. For example, if a person who is an Australian citizen or a permanent resident passes away and leaves assets overseas, moveable assets are dealt with in accordance with the law of Australia.
Moveable assets located outside of Australia are dealt with by the executor of the estate using the local Australian laws.
Because different countries have different jurisdictions and laws, it may be difficult to determine the means by which non-moveable assets are dealt with. For instance, some countries may provide for provisions of forced heirship (which is sometimes derived of religious rights) where a family member entrenches his or her rights and take a certain proportion of the property. Other countries may have inheritance taxes which may be applied.