Many people often try gifting property that they don’t own in their wills.  This is particularly common where a person has tried to make a will using a will-kit rather than getting a solicitor to draft their will.

Some of the types of property that can’t be gifted include:

• Jointly held property.

  • Many couples often own their house as “joint tenants”.  This means that the property cannot be gifted via a Will as the surviving owner automatically inherits the property.

• Property held in Trust or Superannuation.

  • Property that is held as part of a family trust or testamentary trust cannot usually be given through a Will.

  • Most superannuation schemes are also a form of trust.  This means that a person cannot gift their superannuation interest unless that superannuation company first chooses to pay the superannuation money to the estate.

  • You can force your superannuation company to pay money to your estate through signing a binding death benefit nomination.

  • If you don’t sign a binding death benefit nomination then eligible persons, such as partners and children, may be able to make a claim that money directly from the superannuation company – instead of it being paid to your estate.

• Shares

  • Certain types of shares in private companies cannot be given by a Will.

• Property that is owned by a Company

  • Property owned by a company cannot be gifted by a Will – instead the person needs to gift the shares in the company.

• Partnership Property

  • While an interest in a partnership property can be given by a Will, the partnership property itself cannot be given through a Will.

•  Proceeds of Life Insurance Policies.

  • Where a person has taken out a life insurance policy and nominated a beneficiary – then this beneficiary will take precedence to any nomination made via a Will.

• Property that has been sold

  • Property that has contracted to be sold but has not yet been transferred cannot be given by a Will.

• Mutual Will contracts

  • Where a person has entered into a contract to leave their property through a Will (e.g. through a mutual will agreement) then the general rule is that the property cannot be given via a Will.  If you have a mutual will then you need to consult a legal specialist as the question can be complicated.

• Businesses operated as a Sole Trader

  • Any business that is run as a sole trader cannot be gifted through a Will.  This is because when they die – the business dies as well.

  • If you run a business as a sole trader, then you should gift the property used to run the business (e.g. the business name, tools etc) rather than trying to gift the business itself.

In conclusion, there are many situations where property cannot be gifted through a will – and for this reason it is important to seek independent legal advice. Feel free to contact us at O’Brien, Connors & Kennett.