Estate planning: What is a Will?
A Will helps you to distribute your estate after your death. Learn how writing a Will lets you decide who gets what when you pass on
What is a Will? A Will is a written document that sets out your instructions and wishes on how you want your estate (your money, property, possessions and other assets) to be distributed after your death. You may want to speak to a lawyer to make sure your Will is valid. It can be altered at any time.
Must you have a Will? Writing a Will is essential if you have dependants like young or disabled children or elderly parents. Your Will can be as simple or as detailed as you want. It holds your instructions on whom to care for your minor children or parents, and how you want your estate to be divided when you pass away. This makes it much easier for your loved ones to settle your estate at a difficult time. If you're single, you may want to ensure your parents or even your pet are well taken care of. A Will makes sure your wishes are carried out without fuss.
What goes into a Will? Your Will should clearly state who is going to:
Inherit your estate (your beneficiary or beneficiaries)
Care for your children under 21 (your children's guardians)
Carry out your wishes (your executor or administrator)
Your Will should also set out how you want your assets disposed of and what happens if your beneficiaries pass away before you.
What if there is no Will? If you pass away without making a Will in Singapore, your assets will be distributed according to intestacy laws, which may not be in line with your wishes. For example, if your spouse and children are financially self-reliant, you may want to provide for your elderly parents, disabled or unemployed siblings, grandchildren or even grandparents. Without a Will, your wishes may not be fulfilled.
Intestacy: What if you don't have an estate plan?
What happens if you don't plan? If you pass away without leaving a Will, everything you own (your estate) will be distributed according to Singapore's Intestate Succession Act.
What is intestacy? Intestacy is the term used for someone who has passed away without a Will.
The rules are as follows:
Survivors Who gets what
Spouse (no parents or child) Spouse gets everything.
Spouse, children (with or w/o parents) Spouse gets half, children get the other half in equal portions.
Children (no spouse) Children get everything in equal portions. Grandchildren can claim their parent’s share in equal portions if their parent is deceased.
Spouse, parents (no children) Spouse gets half, parents get half in equal portions.
Parents (no spouse or children) Parents get everything in equal portions.
Brothers and sisters (no spouse, Brothers and sisters get everything in equal portions.
children or parents) If a brother or sister is deceased, their children can claim their share.
Grandparents (no spouse, children, Grandparents will each get the estate in equal
parents or siblings) portions.
Uncles and aunts (no spouse, Uncles and aunts get the estate in equal portions.
children, parents, siblings or
grandparents)
None Everything goes to the government.
Estate planning: What is probate?
What is probate? Probate is a legal process for distributing your estate according to the terms of your Will. The executor named in the Will has to apply for a Grant of Probate to legally distribute a deceased’s assets.
How to apply? Depending on the value or complexity of the estate, a lawyer may or may not be needed. A lawyer can help an executor:
- Verify the original Will at the Probate Counter, Registry of the Family Justice Court.
- Present court papers to extract the Grant of Probate. Documents include originating summons, supporting affidavit and schedule of assets.
The whole process may take 3 to 6 months. You may receive the Grant of Probate within a month of filing the last court document.
As for which Court to apply to, generally, estates with assets of less than $5 million fall under the jurisdiction of the Family Courts. Estates of a higher value fall under the Family Division of the High Court. Documents needed, you will need the following documents:
- Original death certificate of the deceased
- Original Will of the deceased
- The deceased’s marriage certificate (if any)
- Original death certificates of next of kin who have passed on
- Original death certificate of executor who may have passed on
- Children’s identity cards and birth certificates
What is a Probate
It is a legal document issued by the courts to enable the applicant to administer the assets of the deceased. The assets of the deceased will need to be managed by the court appointed executor/administrator. To become the appointed executor/administrator, the intending person has to apply for Grant of Probate or Grant of Letters of Administration with the FJC.
Probate and Administration is the legal process of appointing the executor or administrator for the Deceased’s estate.
This section deals with the procedure for obtaining a Probate in the Family Justice Courts (FJC) (which includes the Family Division of the High Court) with effect from 1 January 2015. The procedure in this section also applies to proceedings commenced before 1 January 2015 provided the matters are heard in the FJC. The information provided below is general in nature and is not intended as legal advice. The FJC cannot provide legal advice or assist with drafting the contents of any document.
Deciding how to transfer your estate
How to transfer your estate - There are many ways to transfer your assets. You can transfer now or have it done for you upon death. Consider the pros and cons before making your decision.
Transfer before death, such as gifts and living trusts.
Transfer upon death:
- Through the probate process
- Through other ways such as joint ownership and insurance nomination
Transfer before death - During your lifetime, your assets (e.g. your savings, property and investments) can be transferred to anyone as gifts or through trusts.
Transfer upon death - Whether you made a Will or not, your estate would be transferred through the probate process. If you don't leave a Will, your estate will be distributed to your beneficiaries according to the intestacy laws or Will substitutes.
Intestacy laws are inflexible and the settlement process is long. Wills and Will substitutes ensure that your estate is distributed more quickly, and according to your wishes.
Will your property go to whoever you will it to?
JOINT TENANCY AND TENANCY IN COMMON
What, some may wonder, is the difference between joint tenancy and tenancy in common? These are the two options homeowners have when it comes to sharing a property - as joint tenants or tenants in common.
When you own a property under joint tenancy and one owner dies, his interest in the property automatically goes to the other joint tenants. Assuming we are dealing with two joint tenants who are married, and say, one of them dies; the property will belong solely to the spouse. This is the most common and traditional way for couples to own property.
All joint tenants always own an equal share of the property so if there are two tenants, they each own 50 per cent. If there are four, each person's share is 25 per cent.
CPF nominations: What happens to your CPF when you pass away?
CPF savings do not form part of your estate and are not covered by a Will. Learn why it's important to make a CPF nomination and the different types of nominations available
Why make a CPF nomination (and what happens if you don't)? CPF savings (balances left in a deceased member's Ordinary, Medisave and Special/Retirement Accounts) do not form part of the estate and are not covered by a Will.
If you don't make a CPF nomination, the money will be distributed via intestacy laws. It will take time to locate the legally-entitled beneficiaries, and a fee will be payable to the Public Trustee's Office to make the distribution. You should make a CPF nomination if you want your CPF savings to be distributed according to your wishes.
Types of nominations - Choose how you want your nominees to receive your CPF savings based on their needs. There are three types of nominations:
- Cash Nomination – Your nominees will receive the CPF savings due to them in cash via cheque or GIRO. Cash nomination is the default unless you specifically opt for one of the other two types.
- Enhanced Nomination Scheme (ENS) Nomination – Your nominees will receive the CPF savings due to them in their CPF accounts.
- Special Needs Savings Scheme (SNSS) Nomination – Parents can nominate their children with special needs to receive the CPF savings due to them on a monthly basis.
What Happens To Your CPF When You Pass Away?
Most coffeeshop conversations about the Central Provident Fund (CPF) are laiden with negative vibes. This is even more apparent when it icomes close to the general elections date. With the advancement of social media and messaging apps like WhatsApp, inaccurate information can spread like wildfire with little validation and consequences.
I chanced upon one of those “fake news” on social media:
- "Everybody please note that when we kick the bucket, all our balanced CPF money will not be automatically deposited into our nominated Next-of-kin’s bank account in cash.
- CPF board will instead send all your balanced CPF money to your nominated Next-of-kin CPF Medisave Account.”
Having experienced the process of doing so recently, we got to the bottom of this.
CPF Nomination Scheme
A CPF nomination provides CPF members with the option to specify who will receive their CPF savings, and how much each nominee should receive, upon their demise. You can make a nomination online by logging in with your SingPass via my cpf Online Services.
To find out more on making a nomination online, you can view a video on “Your guide to making a CPF Online Nomination”.
You should make a CPF nomination if you want to distribute your CPF savings according to your wishes when you pass on. Without a nomination, your CPF savings will be distributed by the Public Trustee’s Office (PTO) to the legally entitled beneficiaries (who are usually family members and next-of-kin) under the Intestate Succession Act or the Inheritance Certificate (for Muslims). The PTO charges a fee for the distribution of your un-nominated CPF savings. You can visit pto.mlaw.gov.sg for more information.
related: CPF Nomination Form
The Lasting Power of Attorney (LPA)
The LPA is a legal document which allows a person who is at least 21 years of age ('donor'), to voluntarily appoint one or more persons ('donee(s)') to make decisions and act on his/her behalf if he/she loses mental capacity one day. A donee can be appointed to act in the two broad areas of personal welfare and property & affairs matters. Click here for a quick infographic summary on How to Make an LPA.
Benefits of an LPA:
- Enables a person to make a personal, considered choice of a trusted proxy decision maker, who is reliable and competent to act in his/her best interests should he/she lose mental capacity one day.
- Alleviates the stress and difficulties faced by loved ones who need to apply for a Deputyship order, if the person loses mental capacity without an LPA in place.
Convenience and Cost of Making an LPA - The OPG has extended the LPA Form 1 application fee waiver for Singapore citizens to 31 March 2021, to encourage more Singaporeans to plan ahead and apply for a Lasting Power of Attorney. Click here to see the LPA Application Fee Table. Nonetheless, applicants are required to pay a fee to engage an LPA Certificate Issuer to witness and certify their applications. Click here to view the List of Most Visited LPA Certificate Issuers and the fees they charge. This list includes Non-Government Organisations who also offer LPA Certificate Issuing services. Click here for more information on How to Make an LPA.
Lasting power of attorney
A lasting power of attorney (LPA) helps you appoint people you trust to act on your behalf if you should lose mental capacity. Learn about the importance of having an LPA and how to go about making one
But how many of us actually plan for the possibility that we may lose our mental capacity Losing mental capacity is a real challenge to our physical and emotional well-being, and creates stress for our family members. It is therefore something worth planning ahead for.
What is an LPA? An LPA is a legal document that lets you (the donor) appoint one or more people you trust to be your donees. They will act and make decisions on your behalf should you lose mental capacity one day. You must be 21 or over and have mental capacity to make your LPA. Your donees can be appointed to act in two broad areas: personal welfare, and property and affairs.
What if you don't have an LPA? If you don't have an LPA and you lose mental capacity, your family member is not automatically given the right to make legal decisions on your behalf. This can hinder their ability to care for you.
Application fees for Lasting Power of Attorney waived for 2 more years till 31 March 2021
Singaporeans who wish to appoint someone else to make decisions on their health and finances if they lose their mental capacity can benefit from a $75 fee waiver for two more years.
The fee waiver for Lasting Power of Attorney (LPA) applications was on Thursday (June 28) extended until Mar 31, 2021.
It was first introduced in 2014 and subsequently extended until Aug 31, 2018, allowing Singaporeans to file their LPA Form 1 applications for free.
His hospital bill: $1.2 million
This is not what someone paid for a home. Rather it is the medical bill businessman Danny Foo accumulated for the 14 months he was in a vegetative state.
The 48-year-old partner of Quayside Group died last Tuesday. He had collapsed and fallen into a coma in July last year, two weeks after he first sought treatment for an infected leg at a private hospital.
"Fortunately, Danny had the foresight to buy insurance early. We have only to pay 10 per cent of the bill, but $120,000 is still a pretty huge amount for the family to pay," Mr Foo's elder brother Steven, 49, told The New Paper.