Where There's a Will There's A

www.ipohecho.com.my FREE COPY IPOH echoechoYour Voice In The Community April 1-15, 2015 PP 14252/10/2012(031136) 30 SEN FOR DELIVERY TO YOUR DOORSTEP – ISSUE ASK YOUR NEWSVENDOR 209 100,000 print readers 1,754,869 online hits in February Is Health Shock Waves Molecular We have increased our print run from 16,000 Tourism Disturb gastronomy to 20,000 copies and the number of pages Possible? Tranquility of comes to Ipoh from 12 to 16. We are YOUR VOICE in the Lumut Naval Perak community so make sure you get your Page 3 Base Page 4 Page 5 free copy every fortnight. Where there’s a Will there’s a Way By Emily Lowe midst the many uncertainties in life, death is something that nobody can escape. As the saying goes, “Where there’s life, there’s death.” In this day and age, death Ais no longer a taboo topic. Morbid as it may seem, these days, people make plans for their eventual death to ease the responsibility for their loved ones after they are gone. But how many of us plan for the smooth distribution of wealth to our beneficiaries upon our demise? To date, unclaimed monies and frozen assets in Malaysia amount to over RM60 billion. Procrastination is one of the main reasons why most of us still do not have a will drawn up. Ipoh Echo spoke to Peter Lee, an estate planner of Rockwills in Ipoh, about will and estate planning. Peter has more than ten years of experience in this field. Continued on page 2 2 April 1-15, 2015 IPOH ECHO Your Voice In The Community Dying Intestate or Dying Without a Will ying intestate means that the person who has died did not leave a will. When this happens, there is a legal process to follow before any asset can be transferred. Assets, Dunlike insurance and Employees Provident Fund (EPF), cannot be nominated. Automatic inheritance is also not possible. Under the Distribution Act 1958 (amended 1997), the lawful beneficiaries, through written consent, agree to appoint an administrator, who would then apply for a Letter of Administration (LA) through the High Court. Two administrators have to be appointed if minor beneficiaries are involved. For estates with a gross value not exceeding RM2 million with properties, an application is made to the District Land Administrator for a Distribution Order whereas for an estate consisting of not more than RM600,000 of movables only, an application to Amanah Raya Berhad is made. But this is only the first step. Additionally, two sureties are required by the High Court to provide security for the administration of the estate, unless an exemption is granted by the High Court. This combined security shall be equivalent to the gross estate value. According to the law, when there is no will, wealth is distributed according to this formula: a quarter to the spouse, a quarter to the parent(s) and half to the child(ren). Or if the parents are no longer around, one-third goes to the spouse and two-thirds to the child(ren). In this instance, the deaths of the parents have to be proven through their Death Certificates, which could be a hassle if they passed away many years ago. A lawyer would then have to be engaged to extract the certificates from the National Registration Department. What is a Will? On the other hand, an individual is mortal, may not know what to do and may not have A will is a revocable declaration of intention regarding the time or the energy to carry out his role. It is a tedious task and many are not aware of their the distribution of our assets to our loved ones upon responsibilities. Learning the process of will execution along the way, they take more time our demise. Although there are people who draw up than necessary in getting the will executed and wealth distributed. their own will, the questions one has to ask are: In many cases, the next of kin have no knowledge about the existence of a will or that they had been appointed as the executor or do not know where the will is kept. An unprotected • Is this a valid and functional will? will is just as good as having no will at all. • Are my instructions in the will clear for my When a corporate trustee is appointed, usually the testator is given an asset inventory executor to understand and carry out? book to list down all his assets which he will keep himself, and custody cards, one for the • Does it achieve my objectives? testator himself and one for his executor. • How can I ensure that there is no tampering to my Therefore, the executor knows whom to contact in the event of the demise of the will upon my demise? testator. If there is any doubt to even one of these Testamentary Trust questions above, it is better to engage a professional In layman’s term, this is a condition stipulated inside the will when beneficiaries are minors estate planner or a lawyer who has the know-how to or have special needs. close all these loopholes. With the objective of progressive distribution of wealth and the preservation of assets, Muslims also can have a will done, appoint stated under this condition include the amount of monies to be paid out as living expenses, for executor(s) and/or guardian(s) in the will. Muslims medical care and education every month, and for the duration of this condition. For example, can give one-third of their estate to non-heirs under until the youngest child attains the age of 18 or for a lifetime, in the case of a beneficiary with Islamic law and the remaining two-thirds inherited by special needs. Faraid heirs. The appointment of caregiver and/or guardian is also stated here. A Muslim may choose to distribute all his assets to the Faraid heirs or to particular Faraid heirs only Size Doesn’t Matter with the consent of all Faraid heirs or to the Faraid There is a misconception that only the wealthy need to have a will drawn up. In estate planning, heirs equally, again with the consent of all Faraid the size of it is immaterial, unless one totally has nothing. The average adult would have at heirs. least some savings in the bank, jewellery, a car, a house, shares in their business and also some Upon a Muslim’s demise, the appointed executor small investments such as stocks and unit trusts. will simultaneously apply for the Sijil Faraid through As such, it is better to plan the distribution of these in the will for assets to be passed the Syariah court for Faraid distribution and the Grant down smoothly to the next of kin. But in cases of special needs of dependents and minors, it of Probate from the High Court. is best to set up a living trust (inter vivos). A living trust (inter vivos) is where the creator of the trust, called a Settlor parks his Appointing an Executor assets in the trust (which is managed by a trustee, usually a corporate trustee) during his Under the law, only one executor is required to be appointed in the will. However, through lifetime. With such a trust, the immediate financial and medical needs of his beneficiary will experience, Peter Lee advises that at least two be appointed, arranged according to priority, be taken cared of for the period of the trust. A trust would have the advantage of being useful in the event that the first executor is unwilling or unable to carry out the duties. A testator is in the event of the Settlor’s disability, as he may be the sole beneficiary during his lifetime. allowed to appoint up to four executors. It can even be used in the event of the Settlor’s disappearance where assets are used for the For the substitute executors of separate wills of a husband and wife, it would be better to dependents and children. have the same person appointed, in the event of a common disaster. If different people were appointed, these two parties would have to work together and at the same pace to execute the To Delay Is Human But to Will Is Divine two wills. Those who would like to read about the importance of a will in real life scenarios can do so The executor is someone who is at least 21 years of age and trustworthy in the eyes of the from Peter Lee’s book, “To Delay Is Human But To Will Is Divine”, written in an easy-to-read testator. His (or her) role would be to apply for the Grant of Probate from the High Court in manner and light-hearted tone. It is available at the Ipoh Echo office, MPH Online, selected the event of the testator’s death. He (or she) may need to engage a lawyer to do so. Popular bookstores, and Peter Lee’s office at No. 108 (2nd Floor), Jalan Raja Ekram, 30450 Once the probate is obtained, the executor, who is entitled to claim up to a maximum Ipoh. It is sold at RM28 a copy. of 5% to the value of the estate, subject to approval of the High Court, for all his (or her) Peter Lee also writes a monthly column in Ipoh Echo. His series, “In The Name Of My troubles, will obtain a court order to collect assets, such as savings from the bank, shares, Father’s Estate”, illustrates the importance of the will in a captivating family drama.

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