Importance of International Wills for Expatriates

Today, we are exploring topic that might not be on everyone's radar yet - the critical importance of a will. When we think of wills, we might imagine something that older individuals prepare, but in reality, it is often prepared as a contingency plan in case of unforeseen accidents. Every country will have differing laws and processes for distributing an estate, and may differ significantly from those in Malaysia, so it’s essential to prepare early for any unforeseen circumstances.

The Importance of a Will.

‍Ensuring Distribution According to Your Wishes.

By creating a will, you can ensure that your assets are distributed according to your wishes. Without a will, the distribution of your estate will be governed by the laws of intestacy, which might not align with your true desires. Preparing a will allows you to make decisions about bequests to family and loved ones and avoid unintended disputes and conflicts.

What is required in a Will?

To fully benefit from a will, it is essential to provide clear and detailed instructions. Specific bequests, designations of beneficiaries, and details about the distribution of assets should be precisely stated in the will.

Read our summary on lessons learned from Aretha Franklin’s inheritance case here.

Why Should Expats Consider a Local Will for Each Jurisdiction Where They Hold Assets

For expatriates, ensuring the smooth distribution of assets across multiple jurisdictions can be complex, especially when each country has its own legal system. For example, while some wills may be recognised in multiple jurisdictions, it's crucial for expats residing in Malaysia to have a local will that specifically addresses their assets within the country. This ensures compliance with Malaysian probate law and helps streamline the distribution process, minimizing potential delays or complications that can arise from conflicting legal requirements across borders.

Without a local will, the probate process can become drawn-out and challenging. For instance, if your multi-jurisdictional will is processed outside Malaysia, your beneficiaries may have to wait for an Order of Probate from another jurisdiction to be resealed in Malaysia before they can access your Malaysian assets. This delay could lead to financial difficulties, especially if your loved ones rely on these assets for immediate needs.

Read more from our partners at Heritance Wills to understand what happens should you have no local will in Malaysia.  

By having a local will in Malaysia, you streamline the process and ensure that your assets, such as property or financial accounts in Malaysia, can be distributed more efficiently, avoiding potential legal complications. This approach allows for better protection of your loved ones and reduces the risk of delays and legal disputes.

Local Wills and MM2H Holders

For expatriates residing in Malaysia under the Malaysia My Second Home (MM2H) program, having a local will becomes even more crucial. MM2H holders often invest in Malaysian assets, including property, and having a local will ensures that these assets are distributed smoothly in line with Malaysian probate laws. This becomes particularly important due to specific requirements tied to the MM2H program. To apply for the release of MM2H bond monies so that the surviving spouse can reapply to stay on in Malaysia is not easy without an Order of Probate. This can put tremendous emotional and administrative strain on the surviving spouse at a highly stressful time.

Protecting Minor Children for Expatriates in Southeast Asia

Estate planning isn't just about protecting assets—it's also about safeguarding the future of your minor children. According to Heritance Wills, expatriates should consider appointing a legal guardian in their local will to ensure that their minor children are cared for if the unexpected happens. This is especially vital when living abroad, to prevent delays or legal complications in ensuring that your children are placed in the right care.

Learn more on how this affects expatriates in surrounding Southeast Asian countries.

Seeking professional assistance in Will and Estate planning.

Creating a will is crucial, so it is recommended to seek assistance from trustworthy legal experts or financial advisors. Especially for expats living overseas, professionals experienced in international estate planning can provide valuable support. If you own assets in different countries, it may be necessary to have multiple wills, and consulting experts can help create a more effective inheritance plan.

Crafting a will is a pivotal step in your journey to secure your family's future. We understand the complexities involved, especially if you are an expatriate living overseas or have assets spread across multiple countries. That is why we recommend enlisting the expertise of reliable legal professionals or financial advisors who can navigate the intricacies of international estate planning on your behalf.

Remember, your will is more than a document; it's the cornerstone of your estate plan. A well-drafted will, complemented by strategic estate planning, can potentially help mitigate the impact of inheritance tax (IHT). This tax is calculated based on the value of the assets you leave behind, and with the right strategies in place, you can alleviate the financial burden on your loved ones.

In this example, we present a common scenario with our British expatriate clients in reducing their IHT liability from £204,800 to just £26,000. Click here.

At every step of your estate planning journey, we encourage you to consider the implications of inheritance tax. By doing so, you are not just planning for the future; you are optimising it, ensuring your hard-earned assets benefit your loved ones in the best way possible.  

As part of Melbourne Capital Group's legacy planning or estate planning services, we work with legal partners to review or produce multi-jurisdictional wills, and set up beneficiary trust structures. If you have any interest or questions, please contact us at info@melbournecapitalgroup.com or fill in the form below.