If A Person Dies Without a Will, What Happens to Their Assets?

If A Person Dies Without a Will, What Happens to Their Assets?

If you are wondering what happens when a person dies intestate (i.e. without leaving a valid Will) then this article will explain things for you. Perhaps you are also wondering whether you may receive an inheritance following the death of someone who didn’t leave a will. If so, this article is also relevant to you.

The main points can be summarised as follows:

If you make a Will before you pass away (a legal document setting out your instructions as to how your assets are shared after death), then you will have named someone as an executor. This means they must distribute your assets as set out by your will. But if you pass away without having made a will, then the Intestate Succession Act will be needed to show who should manage the estate, how the assets should be shared and with whom. You therefore have no power to decide who gets your assets after your death.

There is a Valid Will – How an Estate is Distributed

In this case the Will contains the directions as to how the estate should be distributed. It will name someone as an ‘executor’ who must apply to the court for something called a Grant of Probate. When the executor receives this, they can then approach the various financial institutions like banks and gather the deceased’s assets. They must then pay off any debts and taxes still owed, before apportioning the assets to the beneficiaries as the will instructs.

There is No Valid Will – How an Estate is Distributed

In Singapore, a person is described as having died ‘intestate’ if they die without leaving a valid Will.

To determine how the estate is distributed, the Intestate Succession Act must be consulted. The relatives of the deceased will inherit the assets according to the proportions set out in this act.

Intestacy can also apply to assets when someone makes a Will incorrectly, and the court has declared it invalid.

In conclusion, for people dying without a Will, the state ultimately decides what happens to your assets, via the Intestate Succession Act, and you have no deciding role to play. It is for this reason that, as a law firm, we advise all our clients to make a Will; it ensures they get to decide who should manage their estate, and who inherits their assets after their death.

What Happens to the Assets of an Intestate Person?

  1. The assets are frozen

Now that the assets’ owner is dead, no money can be withdrawn from bank accounts, no properties sold, and no securities transferred in any way. To begin to access these assets, an application must be made to the court by the deceased’s next of kin, to obtain Letters of Administration.

This is a situation we frequently come across as lawyers, where the next of kin require a Grant of Probate (if a Will exists) or Letters of Administration (if no Will) to deal with frozen assets.

  • To access bank accounts in the sole name of the deceased, the next of kin need to apply for probate to obtain the money in them
  • To transfer or sell an HDB flat or other private property in the sole name of the deceased, then the next of kin must apply for probate
  • To enable an insurance policy to be paid out, the insurance company will ask to see either the Grant of Probate or the Letters of Administration, to ensure they are paying out to an authorised individual.
  • Where the deceased had a car, or shares, then in order to transfer or sell that property, proof of probate is required.
  1. Next of kin must apply for Letters of Administration to unfreeze the assets

A specialist probate lawyer should be engaged by the next of kin (normally the spouse or eldest child of the deceased) to obtain a Grant of Letters of Administration. The purpose of this court order is to appoint the next of kin as the personal administrator of the estate. Their duties include gathering the deceased’s assets, settling any debts, and ensuring the beneficiaries receive the rest of the estate they are entitled to.

This administrator is tasked with managing and distributing the deceased’s estate, according to the Intestate Succession Act. The Act lists the following people, in the order they are eligible to apply for Letters of Administration:

  • Spouse
  • Children
  • Parents
  • Sisters and brother
  • Nieces and nephews
  • Grandparents
  • Aunts and uncles

According to this order, if the deceased’s children want to be administrator(s), then the spouse of the deceased must give up their right to apply for Letters of Administration.

Letters of Administration will be granted to the applicant, assessed by the court as being the most suitable person to manage the estate of the deceased.

  1. The assets will be used by the administrator to pay off debts

An accurate list of assets will need to be made by the administrator, in order to pay off the deceased’s loans, taxes and debts. Included in this will be credit cards, utilities, subscriptions and bank loans.

  1. Assets are distributed to surviving family members under the Intestate Succession Act

 The distribution of an intestate person’s assets must be done in accordance with the Intestate Succession Act. The inheritance to be distributed includes real estate, securities, bank accounts, and any other assets that the deceased owned at the time of their death, once taxes and debts are paid.

How an intestate person’s assets are divided in Singapore will depend largely on whether they were married or single, and if they had children.

It is often assumed that if a person dies without leaving a valid Will, their spouse will inherit everything. However, this is only true if the deceased had no surviving parents and no children. If children or parents are still living, then the spouse will actually only get 50% of the inheritance.

What happens more often is that the deceased person’s property is apportioned between several different members of their family – usually their spouse, brothers/sisters, aunts and uncles, and grandparents.

  1. The Intestate Succession Act sets out how much the beneficiaries inherit

Look under section 7 of the act to find out how to distribute the deceased’s estate where there is no Will. These rules of inheritance must be followed by the administrator of the estate, as follows:

  • There is a spouse (but no children or parents): the spouse gets everything.
  • There is a spouse and children: spouse gets half of the assets, the children get the other half in equal shares.
  • There are children but no spouse: children share everything equally.
  • There is a spouse and parents, but no children: spouse gets half, parents get the other half in equal shares.
  • There are only parents (no spouse or children): parents get everything in equal shares).
  • There are only brothers and/or sisters (no spouse, children or parents): the brothers and sisters (or children of the deceased brothers or sisters) share everything equally.
  • There are only grandparents (no spouse, children, parents, brothers, sisters, or children of deceased brothers or sisters): grandparents share everything equally.
  • There are only aunts and/or uncles (no spouse, children, parents, brothers, sisters, children of deceased brothers or sisters, or grandparents): uncles and aunts inherit everything shared equally.

Contact a specialist estate lawyer

It’s often overwhelming and emotionally very stressful to deal with a loved one’s estate in the aftermath of their death. Our probate lawyers are always compassionate and professional when dealing with clients at this sensitive time, and can help them through probate or estate administration.

Should you require legal representation, kindly contact us for a free first consultation with one of our lawyers.
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