Wills should be updated regularly. e.g change in assets – buying, selling, mortgages etc and change in family – births, deaths, marriages etc.

provision for the wife refers to allowing for her "proper maintenance, education or advancement in life"

Thats probably the best way. Interest on money borrowed to reno an investment property should be deductible.

Don't use your cash to reno the investment as this will mean you have less cash for your PPOR and will result in higher non deductible interest and therefore higher tax.

I recently helped a friend do this. $80k down to less than $40k.

I am doing a masters degree in wills and estates now and am interested in this area.

firstly what state are you in?

Secondly, your potential inheritance has dropped dramatically because of your dad marrying!

Superannuation does not form part of your estate on death. Super is a trust and is not the asset of the individual until they receive it from the fund. You need to speak to your dad about a binding death nomination. These have to be prepared correctly otherwise they are invalid. Without one the trustee of the superfund will decide where to pay any benefits. Usually they would just pay the surviving spouse. The benefit can be paid to an individual or it can be paid into the estate. It may be best to keep it out of the estate as wills can be challenged – but this will depend on which state you are in. There are also tax considerations too. If your dad leaves a tax dependent then the super canbe received by the dependent tax free. it can be a lump sum or a pension. Its a very complex area and I don't know much about super.

There are also provisions known as Family Provision which enable someone who is not adequately taken care of in a will to apply to the court for an order to basically rewrite part of the will to give them a share or to increase their share. Only an eligible person can apply for a Family Provision order and being a spouse or a child of the deceased would qualify. Even if he leaves her a little bit she can still make a claim, as can you. The court will take into account various factors such as the person's needs, their own resources, and the size of the estate etc.

Also, if you are in NSW property that does not form part of the estate can be deemed to be part of the estate. This includes property such as superannuation and trust assets, property sold before death without adequate consideration etc. eg. Your dad transfers property to you for 50% of its value 3 years before his death. This could be deemed to be part of his estate and she could make a claim for it.

Spouses also have rights to acquire property. He may die leaving you half and her half and she may be entitled to say she wants to keep the house she is living in and have it reduce her share of the remainder of the estate.

So many things to consider, especially with blended families.

If your dad dies without a will, then the rules of intestacy will prevail. She may end up with a very large chunk if this were the case.

Are you asking if I am a director of a company which is the trustee of a discretionary trust?
Yes.

I think JPCCP must have been making just a general comment about the trust owning the family home and the loans.

I think the family home should generally be held in personal names, in the name of the spouse least at risk. This is because if held in a trust land tax will apply and so will CGT. Both could be avoided otherwise.

If you already have a trust with some assets the trust may be able to lend the individual money to buy the house, or part of it. This will help protect it, especially if the trust takes a mortgage over the property.

I agree with that JPCCM.

In my eg of the person tripping and suing the trustee, this would be a trust debt (assuming the trustee lost).

And, just move back into the property 5 years 11 months after you moved out and then later move out and you will get the 6 years again.

6 years.

(the 6 on my keyboard don't always work!! – maybe like your 'n'?)

Hi Jason

Are you saying you lived in the unit first and then rented it out?

If so you may be able to avoid CGT totally and still rent it out for up to  years as long as you are not claiming the CGT main residence exemption on any other property.

Otherwise you will be up for CGT from the date you rent it out. For CGT purposes the market value at the date when first used to produce income will be important, s118-192 ITAA 1997. So you should get a valuation as of that date (the higher the better too).