LOGO

Estate Planning and Wills in a Multi-jurisdiction Setting for Taiwanese Citizens

  • Insights 2018/09/08

By  Dr. Andrew Du Boulay

 

Taiwanese citizen residing in Taiwan can make use of a Will made under Common Law to allow their executor to administer assets located in Australia or any other common law jurisdiction.


A Will is a legal statement by which a person (the testator) names the people (the beneficiaries) they want to receive their property and possessions after they die. Making a Will following legal protocols is particularly important for anyone with assets and is the surest way they have of distributing their property and providing for family members after their 

 

In Common Law countries, for a Will to be valid it must be in writing: handwritten, typed or printed; nominate an executor to administer the Will; outline the powers given to the executor by the Will; describe the desired proportions into which the assets of the testator should be divided; name the beneficiaries who will receive a bequest; be signed by the testator and witnessed by two witnesses who must be simultaneously present when the testator signs the Will. They must also sign at the end of the document. Under Common Law, beneficiaries of a Will cannot be witnesses to the same Will, meaning the two witnesses cannot receive any benefit from the testator's Will. If a Will is not made in this manner it may not be enforceable and the property of the estate may be disposed of at the court's discretion which would probably be at odds with the testator's intentions. Ideally, the court needs to be satisfied that the Will represents the testamentary intentions of the deceased person, the executor is who they say they are and that the Will is valid. If the court is satisfied death. An Australian Will ensures that the people to whom you assign your property receive it promptly, in a manner which should render your estate liable to no income tax. of those conditions, then it will grant probate meaning the executor will then have legal power to administer, collect, sell and distribute the assets of the estate to the beneficiaries.


A Will enables a testator to nominate their preferred executor, that is the person who will manage and distribute the property of the estate. All too often, leaving no Will creates extra anxiety for family members at the time of greatest bereavement. Having a Will is a way of making life easier for them. An important factor to consider is that a Will can be automatically revoked if the testator changes his marital status, meaning a Will made while someone was married will be revoked when he becomes divorced and vice versa. Hence a Will must be up-dated any time the testator's personal relationships change.


A Will made under Common Law conditions is valid in any Common Law jurisdiction. It matters not where the Will is drafted or executed, but rather whether it accurately describes the intentions of the testator to dispose of his assets upon his death in a set manner which complies to the inheritance laws or death taxes that may apply in each particular jurisdiction where the assets are located. Subsequently, a Will correctly drafted and properly executed in Taiwan (in English) by a Taiwanese citizen has legal standing to be acted upon in a secondary jurisdiction where the property of the testator is located. Such a scenario would apply to a Taiwanese citizen who owns real estate property or has financial assets or bank accounts in Australia, New Zealand or any other common law jurisdiction.


Obviously, it is important that the executor of an estate or the executor's appointed legal representative be located in the secondary jurisdiction to visit banks and close bank accounts, transfer any land, sell any property belonging to the estate, settle any debts associated with the estate, and forward money back to the estate trust. After the monetary assets of the estate have been collected and the expenses deducted (including any tax liabilities associated with the estate), the remaining money can then be transferred onto the beneficiaries regardless of where they are located, including overseas.

As we know, some jurisdictions do impose inheritance taxes on a deceased person’s estate. For example, in Taiwan the tax rates levied on inheritance and gifts was reduced to 10% (down from almost 50% in some cases) under President, Ma Ying-jeou in 2009. The excessive tax rates that existed prior to 2009 prompted many wealthy Taiwanese to shift their money offshore to low-tax havens like Hong Kong and Singapore; such tactics forced the Taiwan Ministry of Finance to reduce the tax rate down to a uniform 10% to encourage the Taiwanese people to keep their wealth within Taiwan. 


Other jurisdictions like Australia, have abolished all forms of inheritance taxes, meaning there is absolutely no reduction in the value of an asset which a testator bequeaths to his beneficiaries. As such, it is common for foreign nationals to own residential property and financial assets in Australia. It is advisable for these foreigners to make a valid Will to simplify affairs, increase certainty, and reduce the costs of administration of the Australian assets in their estate. The Will does not have to be made or signed or witnessed in Australia but it must comply with the correct format of a valid Common Law Will and make mention of the assets held within Australia and to whom they should be passed onto. 


Australia has an efficient, real time electronic land title registration system enabling prompt searching of the owners of all land within Australia. The registration process is quick; title can be registered on the same day settlement occurs and purchasers are not required to be present in Australia to complete registration. While Australian law looks primarily at Title Deeds to determine the legal ownership of real estate property, equitable ownership may not be as apparent. For example, the registered owners of land on the Title Deed may be trustees of a Trust where the actual beneficiaries to the Trust are not mentioned on the land Title document. Similarly, there may be multiple beneficiaries to a Trust which owns property, but the beneficiaries are named specifically in a Trust Deed linked to the land, not on the actual land Title Deed itself. Nonetheless, the Common Law practice of officially recording the ownership of land, easements, leases, personal property and trusts makes for a safe environment to protect and preserve peoples's wealth.

 

 

AUTHOR: Dr. Andrew du Boulay

Dr. Andrew du Boulay is an Attorney / Legal Counsel at Brain Trust International Law Firm, with offices in both Taiwan and Australia.

Copyright Brain Trust International Law Firm

Disclaimer: While every effort has been made to ensure the accuracy of this publication, it is not intended to provide legal advice as individual situations will differ and should be discussed with an expert and/or lawyer. For specific technical or legal advice on the information provided and related topics, please contact the author.