W
e have expertise in will drafting, including simple wills and wills with testamentary trusts and wills dealing with complex financial structures for clients in the Hunter Valley. Without a will then you will die intestate and state legislation will control how your estate is distributed. Your will is your chance to state your wishes about how your estate is to be divided after your death.
What is an Accredited Specialist?
In the legal profession an Accredited Specialist is a practising solicitor who has demonstrated specialised competence in a particular area of law and has been conferred Specialist Accreditation by the Law Society under its Specialist Accreditation Scheme.
Why should I use an Accredited Specialist?
To become an Accredited Specialist a solicitor must have practised law full-time for at least five years and worked in their area of legal specialty for at least three years.
To gain status as an Accredited Specialist a solicitor must pass the Law Society’s rigorous assessments in communication, problem solving, client relations and, of course, their specialist area of law.
To maintain their status as an Accredited Specialist, a solicitor must annually renew their accreditation to practise the law and membership of the Law Society, plus ensure they maintain their high level skills and knowledge by completing additional professional development points.
Of the 64 Accredited Wills & Estates Specialists in NSW 48 of them are in Greater Sydney.
We are proud to have Katelin Whitley as the Hunter New England’s only Accredited Wills and Estates Specialist.
While providing bespoke Wills and Estate packages for her clients, Katelin also lectures at the College of Law in the Wills and Estates Masters Program, and has recently completed her Masters of Forensic Mental Health.
She also sits on the Elder Law, Capacity and Succession Committee who monitor all matters related to elder, capacity and succession law.
Should you consider a testamentary trust in your Will?
A testamentary trust is a trust established in a will. It involves a trustee holding property for the benefit of beneficiaries selected by the will-maker on terms and conditions set by the will-maker.
A discretionary testamentary trust is one where the trustee has discretion to choose which beneficiaries share in distributions from the trust fund. This enables considerable flexibility, especially when it comes to minimising the payment of tax, unlike when an outright gift is left to a beneficiary in a will.
A major advantage of testamentary trusts is that concessional rates of tax apply to minor children who receive income from testamentary trusts. This means that distributions of income to children are taxed using the adult tax-free threshold ($18,200 per year) and marginal rates of tax.
A simple example showing the type of flexibility and tax advantages that can be achieved with a testamentary trust is as follows.
Assume you have one son who has two children and you leave your estate to your son as trustee of a discretionary testamentary trust. The beneficiaries of that trust are your son and his two minor children. On your death you leave an estate of $2 million which is invested and returns $150,000 per year. Assume $50,000 is distributed to each beneficiary. Then the tax payable is, ignoring the Medicare levy:
Each family member has the benefit of the $18,200 tax-free threshold so that the total tax bill for the family from income from the testamentary trust is $23,391. If you had just left the whole of your estate to your son, then the tax he would pay on the income earned from his inheritance would be $42,997.
This is a tax saving of $19,606 each year for your son’s family. The strategic use of a testamentary trust could pay for the education of your grandchildren in tax-free dollars.
Discretionary testamentary trusts are also an important tool for the protection of assets, especially when you have a beneficiary in your will who suffers from a disability or is not capable of handling financial matters. An independent trustee could be appointed to manage a testamentary trust for a vulnerable beneficiary.
Discretionary testamentary trusts are not suitable for all will-makers. If you are interested in including a testamentary trust in your will you should get legal advice about whether it would be appropriate in your circumstances.