Here are a few things you may need to consider.
• WINZ Benefit
When you make a will you should consider the effect of the inheritance you wish to leave of a child reliant on a WINZ benefit. This could significantly affect the amount they would then receive.
If you inherit money, you should let Work and Income (WINZ) know. The inheritance may affect your supplementary benefits, but it usually won't affect your main benefit.
If your total savings exceed certain thresholds, you may lose eligibility for means-tested benefits. To find out more you can contact WINZ by phone at 0800 559 009, but to help you avoid receiving incorrect information, we recommend you actually go into a WINZ Centre and talk directly to someone. Another alternative is to consult a financial advisor about your particular circumstances.
• Kiwisaver
You can set out in your will how you want your Kiwisaver funds to be distributed. If your KiwiSaver funds are not specifically distributed in your will, the funds will be managed by a court-appointed administrator who will distribute them according to the rules of the Administration Act 1969, meaning your closest relatives will likely receive them based on a set order of priority, such as spouse, children, parents, and siblings; this process can be lengthy and complex compared to having a clear will outlining your wishes.
Under the Administration Act, if your KiwiSaver balance is $15,000 or less, a KiwiSaver provider can release the funds to a close family member without requiring a full court process. This is an exception to the general rule that KiwiSaver funds require probate or letters of administration to be accessed if the balance is over $15,000.
• Asset Threshold
The Administration Act also says that an executor can distribute an asset valued at or below $15,000 without needing probate. For example, an executor can distribute money in bank accounts up to $15,000, shares up to $15,000, and certain other assets without requiring court approval.
For more information click here: Community Law: Small Estates - No need for court approval
• Trustee appointment
If you have set up a trust you should be clear in your will about who the trustees of the trust are on your death, and/or who has the power to appoint trustees after your death. If you do not give away this power in your lifetime, then you need to give the power to someone when you die so the trust can continue to operate.
If a power or function within a trust is not specifically delegated, the Trusts Act 2019 provides that it can be exercised by the trustee's executor, and if no executor, then the personal representative. This is often the case when a trustee dies or is otherwise unable to act.
Trustees can appoint others to exercise or perform specific powers or functions on their behalf. However, there are limitations to what can be delegated, such as the determination of how trust property is distributed.
If a trustee dies or is unable to act, the surviving trustees (if any) may exercise the power until a replacement is appointed.
The executor of a deceased trustee's estate can also exercise the power, particularly if the trustee was the sole trustee or the last surviving trustee.
If there is no executor, the personal representative (administrator of the estate) can act on behalf of the deceased trustee for a reasonable period.
The Trusts Act 2019 clarifies these situations and provides a framework for ensuring that trust powers are exercised even in the event of a trustee's death or inability to act. It is recommended that the power to appoint trustees not be left just to one person because it provides an opportunity for one person to control the entire trust.
