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Costs – All costs agreements now able to be signed electronically

13 March 2018 by By Lawyers

All of the By Lawyers costs agreements now have electronic signature fields allowing them to be signed electronically via DocuSign, which is available to LEAP in the cloud users. The fee disclosure for this service has also been added into the disbursement section of the costs agreements, should the client choose to take advantage of this service.

 

Filed Under: Australian Capital Territory, Federal, Miscellaneous, New South Wales, Northern Territory, Practice Management, Publication Updates, Tasmania, Victoria, Western Australia Tagged With: costs, docusign, electronic signature

Estate planning – An exciting opportunity for small law firms

1 January 2018 by By Lawyers

The usual wills versus a will with estate planning

For most clients a will is a straightforward document that appoints an executor, an alternate executor, perhaps makes some specific bequests of personal items to certain family members, then leaves the balance of the estate to their spouse then their children with a default clause if none of these beneficiaries survive.

The fees charged by most firms are modest and reflect the reality that most clients do not wish to pay a great deal for something that they only reluctantly accept that they need and know they will never personally use and can prepare themselves using a form bought from the post office.

Wills have traditionally been seen as valuable because they eventually bring the firm estate work, rather than valued for the fees associated with the wills themselves. There is an old adage that the goodwill of a practice are the good wills in safe custody.

However, estate planning is a different thing and many firms are now taking a far more comprehensive approach, with a far more profitable result.

Estate planning is an area where small firms can grow their offering to existing clients and attract new, high net worth clients who require and appreciate professional expertise and assistance in this important area of practice.

It is far easier to offer this expertise than many small firms realise. The By Lawyers suite of testamentary trusts and wills clauses, together with the extensive commentary on wills and estate planning, means that firms can confidently advise clients who may have substantial assets including business interests held in company, partnership, trust structures or self-managed superannuation funds.

Whereas a firm might charge few hundred dollars for ‘husband and wife’ wills, the comprehensive succession planning required by a family with substantial assets and interests, including a review of existing structures and documents, preparation of wills which incorporate testamentary trusts, plus other appropriate documents such as powers of attorney and appointments of enduring guardian, is likely to involve fees of many thousand dollars, as well as extending the relationship between the firm and the family to other areas and members. Clients who have such assets and need such advice are mostly very happy to pay for it because they realise the value of the exercise and are as dedicated to retaining their assets for their family as they were to building up those assets in the first place.

Why testamentary trusts?

For clients with substantial assets, complicated families or family members who have medical or personal problems, the use of testamentary trusts has multiple benefits over usual wills, summarised below.

Creditor protection

To protect a bequest from being accessed by creditors of a beneficiary, including guarantees for a business venture.

Divorce of a child

To avoid family assets being redistributed by the Family Court. Assets held in trust are not assets of any individual and the Family Court cannot make an order requiring the distribution of those funds.

Education

Bequests via testamentary trust for payment of school and tuition fees for grandchildren is more tax efficient than simply leaving money to the child’s parents.

High risk beneficiaries

Where one of the beneficiaries is in a high-risk business or has personal issues with drugs or gambling which warrant strict controls being placed on access to any estate funds.

Remarriage of spouse

To limit access to existing family assets by a new family or spouse.

Tax benefits

To minimise tax payable, facilitate income splitting and distribute tax free to children under 18 on marginal rates with the no tax threshold.

Will challenges

Keeping estate assets in trust means they are not in the beneficiaries’ estates and therefore not subject to challenge when they die.

Disabled children

To ensure that any disabled or intellectually impaired children are provided for in the most effective way. A Special Disability Trust can provide a substantial bequest to a disabled child without impacting on any Centrelink benefits.

Identifying the right clients for complex estate planning

Although most clients potentially would benefit from a testamentary trust, their present circumstances do not suggest that one is necessary. In contrast estate planning is essential for clients with high net worth, multiple assets and asset types, business interests, complex business structures, existing family trusts, self-managed superannuation funds, complicated family arrangements and relationships and potential beneficiaries with special needs or personal problems.

Many clients have not considered the need for estate planning which with the aid of By Lawyers commentary and precedents can be offered by practitioners.

The benefits of testamentary trusts

  • The fundamental advantage of a testamentary discretionary trust is that the assets are held by the trustee for the beneficiaries, not by the beneficiaries themselves. This allows the protection of assets from claims against beneficiaries and from misuse.
  • Separate fixed trusts can be established for separate people or purposes, with conditions. For example, if one child has a drug addiction, a bequest could be left in trust for that child to receive appropriate maintenance and treatment, without them having access to the capital.
  • If a beneficiary faces bankruptcy, an inheritance for that beneficiary through a testamentary discretionary trust will not form part of the beneficiary’s bankrupt estate.
  • Assets held within a testamentary discretionary trust are not part of the matrimonial pool to be divided up in any family law property settlement in the event of divorce.
  • Testamentary trusts also provide an opportunity for testators to control assets after their death, by way of conditional access to trust assets. While not desirable for the beneficiaries, this can certainly be seen by many testators as an advantage.
  • Testamentary trusts can be very tax effective – income, capital gains and franked dividends can be distributed among all beneficiaries each year in the most tax-efficient way.

By Lawyers precedents and commentary

Using By Lawyers publications gives your firm the tools and confidence to assist clients with their estate planning, bringing profitable new work and quality new clients into your firm.

Filed Under: Articles, Australian Capital Territory, Federal, New South Wales, Northern Territory, Queensland, South Australia, Tasmania, Victoria, Western Australia, Wills and Estates Tagged With: estates, Wills

Foreign resident capital gains withholding clearance certificates

11 December 2017 by By Lawyers

Clearance certificates will not be issued during the ATO’s Christmas closure – 22/12/17 to 2/1/18.

Filed Under: Australian Capital Territory, Conveyancing and Property, Legal Alerts, New South Wales, Northern Territory, Queensland, South Australia, Tasmania, Victoria, Western Australia Tagged With: ATO, Australian Taxation Office, Capital gains tax, CGT, Clearance certificate, conveyancing, Conveyancing & Property, Foreign Resident Capital Gains Withholding Payment, FRCGWP

By Lawyers Obiter mailing list

7 December 2017 by By Lawyers

Hello

Obiter has been redesigned to better deliver news about our publications in line with changes to legislation, practice and procedure.

The simpler structure will allow users to tailor their preferences and only receive information about the state they are interested in. Some subscribers may be interested in more than one state.

Please note that Federal has been auto selected for all users and will include notifications about updates to the following publications:

  • Bankruptcy and Liquidation
  • Companies, Trusts, Partnerships and Superannuation
  • Defamation & Protecting Reputation
  • Employment Law
  • Family Law
  • Personal Property Securities
  • Practice Management
  • Trade Marks
  • Immigration – coming soon!

If you would like to review your notification preferences, perhaps add an additional state or deselect federal, please complete the form Subscribe to our mailing list.

We hope you enjoy the updated Obiter – bringing you legal news since 2015.

If you would like to touch base or offer feedback please feel free to email us at askus@bylawyers.com.au.

Warm regards

The By Lawyers team

Filed Under: Australian Capital Territory, Federal, New South Wales, Northern Territory, Publication Updates, Queensland, South Australia, Tasmania, Victoria, Western Australia

Wills – resignation of trustee

1 September 2017 by By Lawyers

A provision has been included in the will precedents to provide for the resignation of a trustee without being replaced, provided one remains.

Filed Under: Australian Capital Territory, Legal Alerts, New South Wales, Northern Territory, Publication Updates, Queensland, South Australia, Tasmania, Victoria, Western Australia, Wills and Estates Tagged With: resignation, trustee, Wills

Probate filing fees

1 September 2017 by By Lawyers

The Supreme Court Probate filing fees have been updated in the retainer instructions and in the costs agreements. 1 July 2017

Filed Under: Australian Capital Territory, New South Wales, Northern Territory, Publication Updates, Queensland, South Australia, Tasmania, Victoria, Western Australia Tagged With: court, filing fees, probtae, supreme

Assets and liabilities list

13 July 2017 by By Lawyers

A new ‘tear off’ assets and liabilities list has been added to the retainer instructions Wills, powers of attorney precedent. This list may assist clients when they wish to provide more detail in their planning, as well retained by the client with their personal documents.

Filed Under: Australian Capital Territory, Legal Alerts, New South Wales, Northern Territory, Publication Updates, Queensland, South Australia, Tasmania, Victoria, Western Australia, Wills and Estates Tagged With: assets, liabilities, list, Wills

From 1 July 2017 – Foreign Resident Capital Gains Withholding Payments

30 June 2017 by By Lawyers

For contracts entered into on or after 1 July 2017 the new foreign resident capital gains withholding (FRCGW) rate and threshold will apply to:

  • real property disposals where the contract price is $750,000 and above (currently $2 million); and
  • the FRCGW withholding tax rate will be 12.5% (currently 10%).

All precedents and commentaries were updated to reflect these changes.

Filed Under: Australian Capital Territory, Conveyancing and Property, Federal, Legal Alerts, New South Wales, Northern Territory, Publication Updates, Queensland, South Australia, Tasmania, Victoria, Western Australia Tagged With: Foreign Resident Capital Gains Withholding Payment. FRCGWP

Foreign Resident Capital Gains Withholding Payment

15 June 2017 by By Lawyers

Early Alert – Foreign Resident Capital Gains Withholding Payment

It is proposed that from 1 July 2017 the regime will apply to all real property with a market value of $750,000 or above. Once the bill is law this alert, the commentary and precedents will be updated.

Filed Under: Australian Capital Territory, Conveyancing and Property, Federal, New South Wales, Northern Territory, Queensland, South Australia, Tasmania, Victoria, Western Australia Tagged With: Foreign Resident Capital Gains Withholding Payment, FRCGWP

Practice management – superannuation

15 June 2017 by By Lawyers

FROM 1 JULY 2017 Concessional Contributions Cap for superannuation reduced to $25,000 for all ages. Before-tax contributions include compulsory employer contributions and salary sacrifice arrangements. Contributions greater than $25,000 from before-tax income may mean payment of extra tax.

Filed Under: Australian Capital Territory, Legal Alerts, New South Wales, Northern Territory, Practice Management, Queensland, South Australia, Tasmania, Victoria, Western Australia Tagged With: concessional cap, superannuation

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