JULIE and Brian were married on the Trent Bridge cricket ground in the United Kingdom, and moved to Australia to begin a life in the sunshine.

They became successful businesspeople, enabling them to frequently visit their family and friends in the UK, every year or so.

After retiring from day-to-day business activities, they wanted to update their wills.

They decided to leave their north coast holiday house to their UK siblings to enjoy the summer, their company shares to their English nieces and nephews, and a considerable amount of money to a mutual friend also residing in the UK.

Their solicitor noted several legal and tax considerations.

The potential capital gains tax (CGT) liability for non-residents who inherit an asset was one consideration.

The beneficiaries may need to pay CGT based on the asset’s value increase since the deceased’s acquisition.

However, certain exemptions can potentially minimize this tax burden.

As they intended to give cash or assets in Australian dollars to the beneficiaries, the beneficiaries may need a foreign exchange permit to transfer funds out of Australia.

The varying requirements for these permits make it essential to consult with the Australian government beforehand.

Providing a large monetary gift may affect a person’s pension or benefit payment.

Although Australia doesn’t impose an inheritance tax, taxes may apply in the beneficiary’s country, therefore it is necessary to understand the United Kingdom inheritance-taxes regime.

Keeping detailed records of the inheritance assets destined for overseas beneficiaries will assist them to calculate any tax liability. Therefore, the testator is encouraged to have discussed their inheritance with the beneficiary to ensure that they understand their rights and responsibilities.

After further consultations with their solicitor, accountant and their overseas beneficiaries, Julie and Brian execute wills that give effect to their intentions while limiting the tax liability and effect of the gifts on the beneficiaries.

Thank you to Anthony Fogarty for his assistance with this column. Email Manny Wood, principal solicitor at TB Law at manny@tblaw.net.au or call him on (02) 66 487 487. This column is only accurate at today’s date and cannot be relied upon as legal advice.