Tax Effective Will - who for?
There are two principal factors which indicate that
consideration should be given to the creation of a "Tax Effective"
Will. The first factor is that beneficiaries are, or the
beneficiaries have, children under the age of 18 years. So
where you have children, grandchildren or great-grandchildren under
the age of 18 years a "Tax Effective" Will maybe appropriate.
The second factor is that there is a substantial amount to pass to
a beneficiary. This amount may vary, depending upon
circumstances, but anything in excess of $200,000 should act
as a trigger to consider the appropriateness of a "Tax Effective"
Will.
Read a worked example of a testamentary trust
where there is a surviving spouse and minor children.
Rather than have your children inherit directly, if they have
children of their own who are under 18 years of age, it may be more
beneficial to set up testamentary trusts for each of your
children. For an example of the income tax advantages of this
- see worked example.
Read a worked example involving
superannuation and insurance proceeds.
Read further details on the concessionary tax
income of minors.