Published On: Fri, Nov 17th, 2017

The best way to describe Letters of Administration

Can the funeral be paid by the estate without a grant of probate or Letters of Administration?

Yes, the bank has discretion to release money from the deceased’s bank account to pay the funeral costs even before a grant of probate or Letters of Administration has been made. The bank will need to sight particular documents before doing so particularly the tax invoice issued by the funeral parlour or the director of the funeral home.

This is important to know especially in circumstances where the deceased did not have funeral insurance or there is no money available at the time or nobody willing to pay for the funeral at such time.

Most funeral parlours and homes are flexible and are happy to wait for payment until a grant of probate of letters of administration has been made if they are aware that the estate is solvent and has assets to pay for the funeral costs.

A local probate lawyer can arrange to obtain the funeral costs from the deceased’s bank account if necessary.

Joint assets

Joint assets do not form part of your estate. Joint assets pass tot eh survivor. For example, if a husband and wife purchase a house together a ‘Joint tenants’ and one spouse passed away, the house will automatically pass to the surviving spouse.

This also occurs if the joint asset is a bank account. If the deceased account holder were to pass away then the bank account will transfer to the surviving joint account holder.

An application to the Supreme Court of NSW for Probate or Letters of Administration does not need to be made for joint assets.

Small estates

There are circumstances when an application for probate may not be necessary. For example when the estate value is low. For example, if the money in the bank account is low. Different banks and institutions have different requirements. For example, if the deceased’s only asset was a bank account with an amount of less than $50,000.00, an application for probate will not be required because the estate value is low and does not meet the threshold whereby it is required.

It is important to consult with a lawyer to ascertain whether or not an application for probate is required.

Another example of a situation whereby probate is not required is in circumstances where the deceased passed away without real property (a house or unit for example) and nominal amount in a bank account and a small amount of superannuation for example $30,000.00.

Conventionally, probate is required. The average Australian will pass away with at least one real property (a house or a unit for example) and money in at least one bank account. In these circumstances, probate is required and in these circumstances, we recommend that an application for probate is made with the assistance of a probate lawyer.

Superannuation does not form part of the estate and cannot be gifted in a will, although we often see that testators try and gift their superannuation and entitlements pursuant to their will. This is handled separately through the trustee of the superannuation fund.

Author: Colin Steinway

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