Estate Planning in NSW for Indians with Assets in Two Countries

For Indians residing in New South Wales (NSW), Australia, with assets both in Australia and India, effective estate planning is crucial. Many NRIs, Overseas Citizens of India (OCI) cardholders, and Indian citizens living in cities like Sydney, Melbourne, Brisbane, Perth, Adelaide, Canberra, and Darwin often face complex legal scenarios when managing estates across borders. This article covers legal solutions under Indian jurisdiction for NRIs while briefly addressing Australian laws and common concerns.

Navigating Cross-Border Estate Planning in NSW

The primary challenge in estate planning for individuals with assets in both countries lies in the differing legal frameworks. Indian inheritance laws, governed by personal laws (Hindu Succession Act, Muslim Personal Law, Indian Succession Act for others), differ significantly from the laws in NSW. For example, the requirements for a valid will vary. In India, an unregistered will can still be valid if attested, whereas NSW requires specific execution conditions.

An Indian citizen living in Sydney with properties in both Sydney and Mumbai. Without proper estate planning, his family may face legal battles in both countries after his passing. In India, they may need to obtain a Succession Certificate to claim the Mumbai property, while in Australia, the assets would be managed according to NSW probate laws.

1. Legal Solutions under Indian Jurisdiction for NRIs in NSW

Indians residing in NSW can use several legal instruments under Indian law for estate planning, especially for Indian assets:

Making a Will in India: NRIs can draft a Will in India under the Indian Succession Act, 1925. This document will address their assets in India. To ensure compliance, the Will must be properly signed and attested as per Indian law. For instance, Mrs. Verma, an OCI cardholder in Melbourne, created a Will in India specifically for her property in Delhi.
Power of Attorney (PoA) in India: A financial PoA executed in NSW for use in India must be carefully drafted, notarised, and possibly apostilled or attested by the Indian Consulate in Australia to remain valid in India. A PoA grants someone the authority to manage assets during the individual’s lifetime. However, it ceases upon the individual’s death, making it unsuitable for long-term estate planning.
Trusts in India: Establishing a trust in India allows individuals to specify how and when assets should be distributed. This can offer greater control and flexibility compared to a simple Will.
Family Dispute Resolution (FDR) in NSW: Although primarily for resolving disputes during an individual’s lifetime, FDR helps prevent conflicts over inherited assets, making it an important tool for proactive estate planning.

2. Cross-Border Jurisdiction Issues

One of the most significant concerns for NRIs in Australia is cross-border jurisdiction over their assets:

Probate and Succession: Obtaining probate in NSW for assets held there and a Succession Certificate in India for Indian assets requires separate legal processes in each country. These can be time-consuming and often need legal professionals from both jurisdictions.
Tax Implications: Inheritance tax laws differ widely between India and Australia. While Australia does not impose inheritance tax, India may levy taxes depending on the nature of the assets and the relationship of the beneficiaries.
Repatriation of Funds: If assets are sold in one country and need to be transferred to another, understanding the regulations for repatriating funds is critical. NRIs need to know how to comply with both Indian and Australian laws.

Highly Searched FAQs Related to Estate Planning for NRIs in NSW

Can an NRI living in Sydney make a valid Will for their property in India?

Yes, NRIs can make a valid Will in India under the Indian Succession Act, 1925. The Will should comply with Indian law and be attested by two witnesses.

Is a Power of Attorney executed in NSW valid for property matters in India after the death of the NRI?

No, a PoA ends upon the death of the principal. For managing assets after death, a Will or other succession mechanisms are necessary.

What happens if an NRI in Brisbane dies intestate, with assets in both India and Australia?

The assets in Australia are distributed according to NSW’s intestacy laws, while Indian assets will follow Indian personal laws. This can lead to complications and a lengthy process. Having a Will can avoid these issues.

How can an OCI cardholder in Perth ensure their Indian assets are smoothly transferred to their beneficiaries?

An OCI cardholder can create a Will in India specifically for Indian assets and may also set up a trust. Seeking advice from a legal expert in India ensures compliance with local laws.

Are there any double taxation issues on inherited assets for NRIs in Adelaide?

Australia does not have inheritance tax, but India may. NRIs should seek advice on how to navigate these tax implications, as double taxation treaties may offer relief in certain cases.

Outlook

Effective estate planning in NSW for NRIs requires a comprehensive approach that accounts for the legal and financial systems of both Australia and India. Engaging with legal professionals who specialise in cross-border estate matters ensures a seamless process. They can offer Customise advice based on individual circumstances and asset types. Failing to plan effectively can lead to complex legal challenges and financial strain for families.

Conclusion

Proactive estate planning in NSW is essential for Indians and NRIs with assets in both India and Australia. By understanding Indian inheritance laws and their interaction with Australian laws, individuals can ensure their assets are distributed according to their wishes, minimising legal complications for their families. Using tools like Wills, carefully considered Powers of Attorney, and trusts will help ensure smooth estate management.

Why Choose LawCrust

LawCrust Legal Consulting, a subsidiary of LawCrust Global Consulting Ltd., is a trusted legal partner for NRIs and Indians across the globe. Backed by a team of over 70 expert lawyers and more than 25 empanelled law firms, we offer a wide range of legal services both in India and internationally. Our expertise spans across legal finance, litigation management, matrimonial disputes, property matters, estate planning, heirship certificates, RERA, and builder-related legal issues.

In addition to personal legal matters, LawCrust also provides expert support in complex corporate areas such as foreign direct investment (FDI), foreign institutional investment (FII), mergers & acquisitions, and fundraising. We also assist clients with OCI and immigration matters, startup solutions, and hybrid consulting solutions. Consistently ranked among the top legal consulting firms in India, LawCrust proudly delivers customised legal solutions across the UK, USA, Canada, Europe, Australia, APAC, and EMEA, offering culturally informed and cross-border expertise to meet the unique needs of the global Indian community.

Navigating Cross-Border Estate Planning for NRIs in NSW: Protecting Your Assets in Australia and India