The Law Handbook 2024

Chapter 9.4: Estates 913 8 where the court or Registrar considers that there are special circumstances making it desirable to require a surety or sureties. During the application for a grant of letters of administration, an application can be made to the Registrar to dispense with a surety. Time for payment of debts The procedure for the payment of debts is the same as where the deceased left a will. The notice to claimants can refer to the administrator, rather than the executor, or otherwise refer to the LPR. Small estates Legislation Many people die leaving only small estates (as defined in s 71 A&P Act) and in such cases, the A&P Act makes special provisions for the procedures mentioned above to be simplified. These provisions apply both to testate and intestate estates (ss 71–79 A&P Act). A special section of the Probate Office deals with small estates as defined by the A&P Act. What is a small estate? For a relatively small fee, the Probate Office will prepare the paperwork required to apply for a grant of representation (probate or administration), under the small estates optional service. A small estate is one where a person’s assets at the date of their death are below the value set by the government each year, currently $125,080. There are no other eligibility requirements to use the service. In eligible cases, a small estates officer can be instructed by the applicant, and prepare and lodge an application on their behalf. The assistance provided by the court reduces the need for people to hire a solicitor and acts as a service to the public. Wages, money, or assets of, or due to the deceased, may be paid directly to the deceased’s executors, immediate family, or persons entitled to the estate without probate, provided that the amount due to the deceased does not exceed $25 , 000 as indexed each 1 July under section 31B of the A&P Act (see ss 31A–31D A&P Act). Example The husband or wife dies leaving a will and the sole beneficiary is the surviving spouse. The assets are a jointly owned matrimonial house valued at $250 , 000, a joint bank account with a credit balance of $8,000 and a bank account in the deceased’s name only with a credit balance of $40,000. A grant of probate will only be required to release the solely owned funds (i.e. the $40,000 bank account in the deceased spouse’s sole name). The small estates optional service could assist the surviving spouse to obtain a grant of probate. Once obtained, the surviving spouse executor would use the grant to deal with the bank and then complete the administration of the estate by themself. Cost A fee of $244.90 is charged to use the small estates optional service, and the usual filing fees on probate applications must be paid (currently $66.80) as well as the advertisement fee of $25.40. (For more information on the small estates optional service, see ‘Small estates and the Probate Office’ in Chapter 2.2: How legal aid can help.) Duties and costs State probate duty Probate duty in Victoria was abolished on 1 January 1984 for the estates of all persons dying on or after that date. Since 7 June 2000 no formalities are required, even for estates where the deceased died prior to 1 January 1984. Federal estate duty This duty was abolished on 1 July 1979. It can be levied only where the deceased died before that date, leaving assets to a brother or sister, remote relative or total stranger. Contact the Australian Taxation Office (see ‘Contacts’ at the end of this chapter). Income tax An estate is liable to pay income tax on the deceased person’s income up to the date of death as if the deceased was still alive. If the estate continues to