How Intestacy works in Australia

What is intestacy?

Intestacy describes the circumstance of a person dying without a Will. It can also be described by the phrase “dying intestate”.

If you fail to create a Will, you have no say in how your assets are divided when you die. Your estate is instead distributed according to the ‘laws of intestacy’ in your state or territory. While it’s not as cut-throat as you might imagine, it could result in some less-than-ideal outcomes when it comes to the distribution of your estate, guardianship of your children and pets, or the allocation of your prized possessions.

Who is an intestate person?

An intestate person can refer to an individual who:

• Didn’t create a Will

• Created a Will that has been lost

• Created a Will that is invalid

• Created a Will that failed to gift all of their assets away

• Created a document with wishes about the distribution of their assets, but without the document meeting the requirements of either a formal or informal Will in Australia

For some people, failing to create an important legally binding document comes down to inaction. This may be due to fear of death, the belief they don’t have anything of value to bequeath to others, not believing in the purpose of a Will, or simply indecision about who should receive their estate.

For others, it could be failing to follow the correct procedures in creating the Will. This is commonly done by forgetting to sign it or forgetting to include witnesses in the process. For more information on how to validly execute a Will, take a look at Safewill’s Will signing checklist.

A Will may also be considered invalid if the person making the Will wasn’t mentally sound when it was signed. If you would like some more information about testamentary capacity, have a read of our existing article which you can find here.

How will my estate be distributed on Intestacy?

When you die without a Will in Australia, your next of kin is generally the first in line for their inheritance. Typically the courts consider the spouse to be the primary beneficiary, followed by any children.

If you were unmarried or not in a de facto relationship and lived child-free, your assets will instead be allocated to your other surviving relatives, such as parents or siblings.

We have broken down the intestacy rules by State, in greater detail below.

Handling an intestate estate

Dealing with an intestate estate is not as simple as the next of kin walking up to their local courthouse and requesting access to the estate. They must first lodge an application to the court to become an administrator of the estate. This process is started by applying for a Grant of Letters of Administration. Once approved, they’ll then become responsible for overseeing the administration of the estate.

Disputes can easily arise at this point, as family members can often struggle to decide who has the greatest entitlement to the deceased estate. This type of application also needs to be accompanied by lots of evidence, such as birth, marriage and death certificates, to prove who the most eligible person or group of people are to apply for the Grant.

However, the full process for accessing and administering an intestate estate will come down to the specific laws set out by each state and territory in Australia.

Intestacy Rules By State

New South Wales

In New South Wales, the next of kin must apply for ‘Letters of Administration’ to the NSW Supreme Court in order to begin dividing the estate. New South Wales typically considers the spouse or the deceased person’s children to be the rightful administrators of the estate over other surviving family members. For example, if the deceased person was married and had children only from that relationship, then the spouse inherits the entire estate.

Comparatively, if the deceased had a spouse but also children from a previous relationship, then the spouse gets a legacy gift of approximately $506,000.00 (as at 1 July 2022, indexed annually per CPI) together with 50% of the remaining estate, and the children from the previous relationship share the remaining 50% of the estate equally. The administrator is responsible for confirming which family members should receive a share of the assets.

A full overview of the persons entitled to the estate is summarised in the following diagram:

Victoria

If someone dies intestate in Victoria, their next of kin is required to apply to administer the estate. The next of kin is deemed to be the spouse or domestic partner of the deceased. If they don’t have a surviving spouse, any surviving children are considered the next of kin. The full estate is generally allocated to their spouse unless the deceased had children from a previous relationship. If the deceased had children from a previous relationship, then the spouse receives a legacy of $486,870.00 (as of 2022) together with 50% of the remaining estate, and the children from the previous relationship share the remaining 50%.

A full overview of the persons entitled to the estate is summarised in the following diagram:

Queensland

In Queensland, the spouse is the first in line for an intestate estate and receives the first $150,000.00 of the estate, with the remaining estate divided between the spouse and any surviving children. If there is one child, the estate is split equally between the spouse and child. If there is more than one child, the spouse inherits one-third of the estate and the children share the remaining two-thirds among themselves equally. If the deceased was not survived by a spouse, the estate is shared equally among their children.

A full overview of the persons entitled to the estate is summarised in the following diagram:

The Australian Capital Territory

The laws in the ACT are similar to New South Wales, with the spouse or surviving children deemed as the rightful next of kin for a deceased estate. For example, the spouse will receive the entirety of the estate if the value is less than $200,000.00. If the estate is valued at more than $200,000.00, the spouse gets $200,000.00 and the remaining estate is divided between the spouse and children equally, depending on how many children there are.

A full overview of the persons entitled to the estate is summarised in the following diagram:

South Australia

In South Australia, the entire estate is allocated to the deceased’s spouse if the total value of their assets is less than $100,000.00. If the value is more than $100,000.00, the spouse will receive $100,000.00 plus all personal property, with the remainder of the estate to be divided up equally between the spouse and the surviving children of the deceased.

A full overview of the persons entitled to the estate is summarised in the following diagram:

Western Australia

In Western Australia, to apply for a Grant of Letters of Administration, you must be the deceased’s next of kin, or more commonly referred to as their closest living relative. The categories of people eligible to apply for a Grant of Administration include a spouse, any biological or adopted children (or their children, being the deceased person’s grandchildren, if a child of the deceased has passed away) the parents of the deceased, or the deceased’s siblings.

If the deceased had children and the estate is worth less than $472,000.00, the spouse will receive the entirety of the estate. However, if the estate is valued at more than $472,000.00 the spouse receives the first $472,000.00 as well as a share of the residuary estate, with the value of the share dependent upon the number of children the deceased person had. If there is a spouse, and no children, then the estate is divided up between the surviving spouse and the deceased’s parents and/or siblings (as applicable).

A full overview of the persons entitled to the estate is summarised in the following diagram:

Northern Territory

In the Northern Territory, to apply for a Grant of Letters of Administration, you must be the deceased’s next of kin, or more commonly referred to as their closest living relative. The categories of people eligible to apply for a Grant of Administration include a spouse or any other person the Court considers appropriate.

Generally, the most eligible person to receive the estate is the spouse of the deceased, and they will inherit the whole estate if the deceased did not leave children. If the deceased had children and the estate is worth less than $350,000.00, the spouse will still receive the whole estate. However, if the estate is valued at more than $350,000.00, the spouse receives the first $350,000.00 as well as a share of the residuary estate, with the value of the share dependent upon the number of children the deceased person had.

A full overview of the persons entitled to the estate is summarised in the following diagram:

Importantly, if the deceased person is an Indigenous Australian, the Northern Territory recognises this and the customs that accompany the Indigenous Australian community. In this instance, persons who claim to be entitled to take an interest in an intestate estate may apply to the Court for an order in relation to the intestate estate.

Tasmania

In Tasmania, to apply for a Grant of Letters of Administration, you must be the deceased’s next of kin, or more commonly referred to as their closest living relative. The categories of people eligible to apply for a Grant of Administration include a spouse, children, parents, siblings, nieces and nephews, grandparents, aunts and uncles, and finally the first cousins of the deceased.

Generally, the deceased’s spouse inherits the whole estate if there are no children. However, if there are children that are children from a former relationship of the deceased and the value of the estate is less than $350,000.00, the spouse receives the entire estate. Although, if the value of the estate is worth more than $350,000.00, the spouse will receive all chattels and personal effects, the first $350,000.00 of the estate plus 50% of the remainder of the estate, and the remaining 50% will be divided equally between the surviving children.

A full overview of the persons entitled to the estate is summarised in the following diagram:

How do I protect my estate from passing on intestacy?

The quickest and easiest way to protect your assets is by creating a legally binding Will before you pass away. This allows you to choose who gets a share of your estate and can help to alleviate potential family disputes arising from concerns over who is entitled to the estate. To ensure the Will is legally binding, it must be signed and dated in the presence of two adult witnesses.

Get started today with Safewill to make end-of-life planning effortless.

How can Safewill Legal help?

If a loved one has passed away and you require assistance with applying for a Grant of Letters of Administration, Safewill Legal can assist. Our team is local and ready to provide you with complimentary guidance about where to start. Start a live chat or call us on 1300942586 to get started today.

The information contained in this article is general in nature and does not take into account your personal situation. It is intended as a guide and may not reflect every possible outcome relevant to your circumstances. You should consider whether the information is appropriate to your needs, and where appropriate, seek professional advice from a wills and estates lawyer.