INVESTING AND PLANNING FOR THE NEXT GENERATION THROUGH PROPER ESTATE PLANNING

Transcription

1 INVESTING AND PLANNING FOR THE NEXT GENERATION THROUGH PROPER ESTATE PLANNING Organized by: Federation of Investment Managers Malaysia Arbayah Ismail, Moreclass (M) Sdn Bhd

2 SESSION am to 1.00pm ESTATE ADMINISTRATION IN MALAYSIA Issues in Estate Administration -Laws and regulations governing estate planning -Estate administration for the intestate and the testate -The roles of Amanahraya, Pejabat Tanah and Civil Court

3 ISSUES IN ESTATE ADMINISTRATION

4 Issues in Malaysia Lack of awareness on the importance of estate administration and estate planning Delay in estate administration somehow reduce the economic benefit from the estate Ignorance and conflict among the heirs contribute to delays in estate distribution Limited knowledge about estate administration and sometimes getting wrong advice from others

5

6

7

8 TUSSLE OVER RM3B ESTATE VALUE 3 June 2010 Claim by second wife over assets. Plaintiff: Second wife and children Defendan: First wife and children, CIMB Trustee etc.

9 AYAH VS ANAK Jul 15, 2010 (sumber Berita Harian Online) BAHAROM Long, 85, (kiri) ditemani peguamnya, Muhd Azmi Talib ketika meneliti dokumen tuntutan berhubung pembahagian harta pusaka bernilai kira-kira lebih RM 2 juta terhadap tiga anaknya di Mahkamah Sivil Shah Alam, hari ini. - Foto Amran Hamid Beliau menyaman tiga anak lelakinya kerana didakwa dikurung dan dipaksa menyerahkan dua lot tanah kepada mereka, dua tahun lalu. Inilah realiti yang berlaku apabila tiada kesefahaman di kalangan ahli keluarga. Ada pula anak yang sanggup menganiayai bapa sendiri disebabkan harta.

10 APPLICABLE LAWS

11 Applicable Laws Probate & Administration Act 1959 Distribution Act 1958 Small Estates (Distribution) Act 1955 Public Trust Corporation Act 1995 Wills Act 1959 Enakmen Wasiat Orang Islam (Selangor) 1999 Enakmen Wasiat Orang Islam (N.Sembilan 2004; Melaka 2005 Administration of Estates Ordinance, Law of Sarawak (Chapter 80), 1948 Probate & Administration Ordinance Sabah (Chapter 109) 1947

12 Probate & Administration Act some extracts Section 3 Grant of probate Probate may be granted to an executor appointed by a will. Section 43 Executor s or administrator s commission Court may at its own discretion grant up to 5% commission on the value of assets collected by them

13 Distribution Act 1958 Not applicable for Muslim Section 6 succession of intestate estate The distribution portion stated with priority to the close family members. Please refer next table

14 Distribution Table If intestate dies leaving; Spouse only, no issue, no parents Spouse 100% Spouse, a parent of parents Spouse 50%, Parent (s), 50% Issue only, no spouse, no parent Issue 100% Parent or parents only, no spouse, no issue Parent (s) 100% Spouse, issue and no parent or parents Spouse 1/3, Issue 2/3 Issue, a parent or parents, no spouse Issue 2/3, Parent (s) 1/3 Spouse, issue and parent (s) Spouse ¼, Issue ½, Parent (s) 1/4

15 Small Estate (Distribution) Act 1955 Section 3 Value of small estate, wholly or partly immovable not exceeding RM2,000,000 Amendment 2008 (earlier was RM600,000) Section 11 Place of hearing for distribution Section 12 Power to summon and examine witnesses, administrator and delivery of documents

16 Public Trust Corporation Act 1995 Section 12 Appointment of ARB as trustee or executor Section 13 Issuance of grant of probate and letter of administration to ARB for estate exceeding RM600,000 Section 17 Administration of estate (movable property only) not exceeding RM600,000

17 Wills Act 1959 Section 6 Execution of appointment by will Section 12 Will to be revoked by marriage Unless a contemplation of marriage clause be included in the will Section 14 Revocation of will by burning, tearing or destroying

18 ESTATE ADMINISTRATION Intestate vs Testate

19 ESTATE ADMINISTRATION FOR INTESTATE AND TESTATE Intestate (without will) Testate (with will) Letter of Administration (by court) Distribution Order (by Pejabat Pusaka Kecil) Muslim Faraid Non Muslim Distribution Act 1958 Application for Sijil Faraid and grant of probate Appointment of administrator Application to appoint two sureties LA is granted Assets distributed to heirs Probate issued by Court Assets distributed

20 Type of assets Movable Cash / Savings Shares Vehicles Personal belongings Immovable Houses Shoplots Land

21 Duties of executor 1) Get the original Will / Wasiat 2) Assist in burial process 3) Advise beneficiaries & heirs 4) Protect assets 5) Prepare assets and liability statement 6) Apply grant of probate 7) Distribute estate 8) Create trust account, if required Protect business interest Insure asset Collect revenues Reserve investment balance Personal effects Cash Shares Properties etc Transfer property to beneficiaries Complete administration process

22 ROLES OF ARB, PEJABAT TANAH AND HIGH COURT

23 Pejabat Pembahagian Pusaka Kecil, Pejabat Tanah dan Galian (PTG) Authorized under Small Estate (Distribution) Act 1955 to process application related to small estate. Small estate is defined as value of movable and immovable property of the deceased not exceeding RM2.0 million Before 1 September 2009, the value of small estate is RM600,000 or less.

24 Pejabat Pembahagian Pusaka Kecil, Pejabat Tanah dan Galian (PTG) Process application submitted by applicant including; Validating documents and information Call beneficiaries for hearing Issue distribution order Process further application for remaining estate not declared earlier

25 High Court Process application for intestate estate with value exceeding RM2.0 million including; Appointment of administrator Validate that no earlier administrator has been appointed for the estate Issue Letter of Administration (LA) Appointment of sureties, if applicable

26 High Court Process application of a testate estate (with will or wasiat annexed) including; Validating the original last will and testament Issuance of Probate to executor Appointment of sureties for estate valued more than RM50,000 (only applicable if the executor other than trustee company)

27 Amanahraya Berhad Authorized under Public Trust Corporation Act 1995 Direct administration for movable assets not exceeding RM600,000 Can be appointed as executor in Wasiat Can be appointed as administrator for intestate estate Can file a petition to Pejabat Pembahagian Pusaka Kecil, PTG on behalf of the beneficiaries

28 Amanahraya Berhad Other duties; Proper safekeeping of Will and Wasiat Facilitate distribution among heirs/beneficiaries Open trust account for minor beneficiaries Manage trust account and distribute partly of the minor portion to the guardian for specific purpose

29 Authority in Estate Administration DEPARTMENT OR AGENCY PETITIONER ISSUE LETTER OF ADMINISTRATION / PROBATE AMANAH RAYA BERHAD YES YES (Movable assets) less than RM600,000 Pejabat Pembahagian Pusaka Kecil, PTG NO YES (Estate not exceeding RM2.0million) High Court NO YES (Testate estate and intestate estate more than RM2.0million) Private Trustee Company YES (Trustee Company Act) NO Individual YES (File of petition at PTG/High Court) NO

30 THANK YOU