If you have overseas beneficiaries, you can include them in your Will—but it’s more than just listing a name and address. Without careful planning, your wishes may encounter delays, unexpected costs, or legal hurdles for your family during an already difficult time.
Modern Australian families are increasingly international, highlighting why planning for overseas beneficiaries is essential:
- 8.6 million people in Australia were born overseas as at 30 June 2024 (Australian Bureau of Statistics).
- 165,193 people gained Australian citizenship between 1 July 2024 and 30 June 2025, many maintaining strong ties to their countries of origin (Department of Home Affairs).
- Nearly 600,000 Australian-born people lived overseas in 2020, keeping connections with Australia (UNDESA).
While your Will remains valid regardless of where your beneficiaries live, sending assets abroad introduces legal, financial, and practical complexities. Thoughtful planning ensures your overseas beneficiaries receive their inheritance smoothly, avoiding unnecessary stress and complications.
Understanding International Bequests
Including overseas beneficiaries essentially creates a cross-border estate plan. Your executor must manage Queensland law, foreign inheritance regulations, and administrative obligations across jurisdictions.
Key considerations include:
- Executor responsibilities: Handling both Australian and foreign legal requirements, international bank transfers, and communication across time zones.
- Asset transfer complexity: Currency conversion, tax obligations, and international banking procedures all affect distribution.
- Foreign inheritance laws: Some countries impose restrictions that may influence what your beneficiaries can access or use.
Not all countries automatically recognise Australian Wills. Jurisdictions may require local probate or other legal recognition before assets can be distributed. Understanding these rules early helps structure your estate to avoid delays and extra costs.
Tax Considerations for Overseas Beneficiaries
Australia does not impose inheritance tax or estate duty. However, overseas beneficiaries may face local taxes that reduce what they ultimately receive.
- Local inheritance tax: Countries such as the UK, France, and Japan, levy estate or inheritance taxes that can diminish gifts. Under the 1953 estate tax convention, a person living in the US who inherits Australian assets avoids estate tax upon inheritance. However, future income, dividends, or capital gains remain taxable. This underscores the need to consider both Australian and foreign tax rules for overseas beneficiaries.
- Capital gains tax (CGT): Assets like shares or property transferred to non-residents may trigger CGT. Typical Australian exemptions often do not apply, and rollover relief may not extend to non-residents.
- Foreign property regulations: Australian real estate left to overseas beneficiaries usually requires Foreign Investment Review Board (FIRB) approval. Fees can be substantial, and approval is not guaranteed. Selling property and transferring cash may be more practical.
Testamentary Trusts and Discretionary Trust Considerations
Testamentary trusts offer flexibility and potential tax benefits, but add complexity for overseas beneficiaries.
- Foreign connections: Trusts involving non-resident trustees or beneficiaries may face unfavourable tax treatment.
- Discretionary trusts: Naming relatives living abroad as beneficiaries can immediately affect the trust’s tax position and property obligations, even if they never receive distributions.
Careful legal, tax, and accounting advice is essential to determine whether trusts offer sufficient benefits over direct gifts, particularly when international elements are involved.
Currency and Exchange Rate Risks
Monetary gifts to overseas beneficiaries require attention to currency and transfer details:
- Default currency: Without specification, gifts are interpreted as Australian dollars.
- Exchange rate fluctuations: A $100,000 AUD gift may convert to very different amounts depending on timing and currency.
- Transfer fees: International transfers incur charges. Your Will should clarify whether costs come from the gift or the estate to prevent disputes.
Personal Property and Physical Assets
Shipping physical items abroad presents unique challenges:
- High costs: Freight, insurance, packaging, customs duties, and import regulations all add expense.
- Practical alternatives: Large items may cost more to ship than they’re worth. Executors may sell assets and distribute cash instead.
- Customs restrictions: Some items may be prohibited or heavily regulated in the beneficiary’s country. Understanding these rules and restrictions beforehand prevents delays or disappointment.
Executors should consider both cost and legal feasibility when deciding whether to send physical items abroad, and seek advice where necessary.
Appointing Executors for International Estates
Choosing the right executor is crucial when overseas beneficiaries are involved:
- Local vs overseas executors: Australian-based executors manage local requirements efficiently; co-executors abroad can help with international coordination.
- Communication: Executors must liaise across time zones and languages.
- Travel and administrative burden: Non-resident executors may face delays, extra costs, and limited access to local institutions. Estates with non-resident executors may even be classified as foreign trusts, triggering higher tax obligations.
Communication and Documentation Requirements
Clear communication is key to smooth administration:
- Accurate contact details: Keep beneficiaries’ addresses, phone numbers, and emails updated.
- Language and translation: Non-English speaking beneficiaries may require translations for legal documents, sometimes officially certified.
- Documentation for inheritance: Identity verification, tax equivalents, and certificates may be required, varying by country. Check local requirements to avoid delays.
Forced Heirship and Foreign Succession Laws
Some countries impose forced heirship rules that override your Will:
- Mandatory inheritance: Civil law countries (Europe, Latin America, parts of Asia) may require certain family members to inherit.
- Legal complications: Beneficiaries may face difficulties accessing their inheritance abroad.
- Separate Wills: Creating jurisdiction-specific Wills for foreign assets can reduce legal conflicts while ensuring compliance.
Seek legal advice in both Australia and the beneficiary’s country to ensure your wishes are enforceable.
Practical Steps for Including Overseas Beneficiaries
To plan effectively:
- Discuss with beneficiaries: Understand potential tax obligations and their willingness to accept the inheritance.
- Review assets: Cash and listed securities are easier to transfer than property or large personal items. Consider selling property and distributing cash if overseas ownership is impractical.
- Document clearly: Include full legal names, addresses, relationships, currency instructions, and who bears transfer costs.
- Consider testamentary trusts: These can offer ongoing management, protection, or potential tax advantages, but weigh against added complexity.
Clear, detailed instructions and professional advice ensure overseas beneficiaries receive their inheritance smoothly.
When to Seek Professional Advice
Planning for overseas beneficiaries involves multiple legal, financial, and practical considerations. The right professional guidance can prevent costly errors and ensure your wishes are carried out effectively:
- Australian legal compliance: An expert lawyer, like one of our Wills and Estates Lawyers Gold Coast, ensures your estate follows Queensland law.
- International tax advice: Consulting professionals in the beneficiary’s country can prevent unexpected liabilities.
- Tailored planning: Cross-border inheritances are rarely straightforward. Each estate is unique; cookie-cutter solutions rarely work for cross-border inheritances.
Moving Forward with Confidence
Leaving a legacy to loved ones abroad requires careful thought, but it’s achievable with proper planning.
- Regular reviews: Update your Will when beneficiaries move, laws change, or your assets or personal circumstances shift.
- Executor empowerment: Clear instructions enable practical decisions on property, currency, and communication.
- Peace of mind: Thoughtful planning ensures overseas beneficiaries receive their inheritance smoothly, sparing them unnecessary stress.
If you’re considering overseas beneficiaries in your Will, or need to update an existing estate plan, talk to one of our expert Gold Coast Wills and Estates Lawyers. We can help you design an estate plan that safeguards your wishes and supports your loved ones across borders.
