From years of family photographs stored on iCloud, to social media accounts, cryptocurrency and frequent flyer points, our digital lives can hold significant financial and sentimental value. Yet, the ownership and or the control of these digital assets are often overlooked when making a Will.

Planning for your digital assets is vital to ensure that important information and assets do not become lost, inaccessible or overlooked and/or forgotten after your death.

What are Digital Assets?

Digital assets include almost anything that you create, own or access, whether stored on an App or otherwise, including;

• Social media accounts;
• Digital photographs or videos;
• Cloud storage and documents;
• Email accounts;
• Cryptocurrency and digital wallets;
• Online businesses and websites;
• Subscriptions; and
• Loyalty and frequent flyer points.

What happens to Digital assets when you die?

The days of waiting for a statement to turn up in the mail alerting your executor of the existence of a bank account, insurance policy or shares are long gone. The mere lack of a login to a deceased’s person’s computer is worse than not knowing where the key to their house is.

There is currently no single Australian law that comprehensively governs what happens to a person’s digital assets after death. Instead, the position depends on the nature of the asset and, in many cases, the terms and conditions of the platform or service provider.

This distinction is important.

For example, cryptocurrency can form part of your estate and be dealt with under your Will. By contrast, many social media, cloud storage and email accounts are provided under a contractual licence. The platform’s terms will determine what your executor or family members can access, download, transfer or delete after your death.

As a result, simply naming someone in your Will does not grant that person the ability to log into or control every online account you have.

Why should you include digital assets in your estate planning?

Without an effective plan, your digital assets may be impossible for your executor or loved ones to identify, access and deal with after your death.

This can mean:

• valuable assets such as cryptocurrency and financial investment are overlooked or irretrievably lost;
• important documents and information becomes inaccessible;
• subscriptions and periodical payments continue to occur and incur fees;
• online accounts remain active after your death;
• personal information is exposed or misused; and
• your loved ones are left with unnecessary stress and uncertainty at an already difficult time.

Cryptocurrency is a particularly apt example. Unlike a bank account, access to cryptocurrency may depend on a private key, recovery phrase or other security information known only to the Willmaker. If your executor does not know that the asset exists, or cannot locate the information needed to access it, the cryptocurrency may be effectively impossible to recover.

In fact, it has been estimated that around 4 million Bitcoin or approximately 20% of the total supply is now permanently inaccessible because owners have died without leaving the information needed to access their holdings.

How Do Different Platforms Handle Digital Assets?

Apple – iCloud, Photos and other Apple data

Apple allows its users to nominate a Legacy Contact, who can request access to certain date stored in your Apple account after your death.

The Legacy Contact will then need to provide Apple with the access code you create when they were nominated, and a copy of your death certificate. This provides access to photographs, messages, notes, files and device backups.

Google – Gmail, Google Photos and Google Drive

Google provides an Inactive Account Manager, which allows you to decide what should happen to your account if it becomes inactive for a period you specify.

You can nominate up to 10 people to be notified and choose whether particular types of data should be shared with them. Google also allows you to request that your account be deleted after the specified period.

Social Media – Facebook and Instagram

Facebook and Instagram allow their users to nominate a Legacy Contact to manage certain aspects of their account after death.

One option is to manage a memorialised account. This is an account that remains online as a place for friends and family to remember the person who has died. The Legacy Contact does not receive the deceased person’s password or unrestricted access to their account or private messages.

Alternatively, you can elect for the Legacy Contact to have the account permanently deleted after you pass.

Cryptocurrency

Cryptocurrency can form part of your estate and can therefore be dealt with in your Will. However, your executor may be unable to access or administer your cryptocurrency if they cannot locate the necessary access information, such as private keys or recovery phrases.

PayPal and online payment accounts

Most online payment accounts, such as PayPal require the executor or administrator of a deceased estate to provide documentation before it will close the deceased person’s account. This can include the death certificate, Grant of Probate or Letters of Administration and identification.

Any funds remaining in the account will then be transferred into the bank account linked to the PayPal account and can be distributed in accordance with your Will.

Frequent Flyer points – Qantas and Velocity

Frequent flyer points can have real value, but they are generally governed by the terms of the relevant loyalty program rather than being treated exactly like cash in your estate.

For example, Qantas allows an executor or administrator to request the transfer of a deceased member’s unexpired Qantas Points within 12 months, to an eligible family member, which includes a spouse, children, parents, siblings or any other blood relative.

What should you do?

The good news is that digital estate planning does not need to be complicated.

We recommend:

1. Checking the platform’s policy

Digital platforms have their own rules about what happens to an account after its owner dies. Check the policies for the platforms you use and, where available, set up arrangements such as a Legacy Contact or account deletion preference.

2. Making a comprehensive list of all your digital assets and accounts

Create and maintain an up-to-date inventory of your digital assets, including social media, email, cloud storage, cryptocurrency, subscriptions, and frequent flyer accounts.

Your inventory should contain enough information to allow your executor or another trusted person to identify each account and understand what you intend to do with it.

Using a dedicated password manager, such as 1Password, Bitwarden or iCloud Keychain allows you to centralise your usernames, passwords, recovery codes and other relevant access information. Many of these password managers also allow you to nominate a legacy contact, granting a trusted person the ability to request access to your protected information after your passing.

Whether you use a digital password manager or choose to record this information elsewhere, you must ensure your Executor is aware of where it is stored and how to access it.

We encourage our clients to ensure that our firm is made aware of the arrangements in place and that this information is securely stored with the original or a certified copy of your Will

A digital estate plan can work alongside your Will

Your digital estate may contain some of your most valuable assets, and some of your most irreplaceable memories.

A Will is an important starting point, but effective estate planning should also include what happens to the digital world you leave behind for the reasons referred to.

Taking the time now to identify your digital assets, review the relevant platform settings and securely record the information your executor will need to be able to properly administer your estate in accordance with your Will.

Let us ensure that the recommended outcomes referred to in this article can be achieved. Please contact our team today.

The post Digital Assets: What, Why and How appeared first on Tony Kelly Lawyer & Estate Planner.

But making a Will does not have to be boring. It can be an opportunity to reflect your personality, your relationships and the things that matter most to you.

Some people have certainly embraced that idea:

• Englishman Roger Brown left part of his fortune to seven friends, on the condition that they use it for an alcohol-filled weekend in a European city.
• Singer Janis Joplin left US$2,500 for her friends to throw a wake in her memory.
• Marvel Comics editor Mark Gruenwald requested that his ashes be mixed with ink and used to print comic books.
• Pringles inventor, Fred Bauer, reportedly wished to be buried in a Pringles can.

While these wishes may be unusual, they demonstrate that a Will can be about more than simply dividing up your assets. It can be an opportunity to recognise the people who are important to you and communicate the wishes that matter most to you.

But there is an important catch: creativity cannot come at the expense of validity.

A Will is a legal document, and your wishes need to be expressed clearly and in accordance with the law. An unusual or complicated request that is unclear or legally ineffective may create uncertainty for your executor and beneficiaries and potentially lead to disputes.

Any gifts expressed with a condition should be carefully considered in light of legal advice to understand whether such condition is legally enforceable.

If you wish to leave an unconventional gift in your Will or include particular instructions, there are several ways you can do so.

Memorandum of Wishes

A Memorandum of Wishes is a non-binding document that accompanies a Will and provides additional guidance to your executor and trustees.

Unlike a Will, it is not legally enforceable. This means you can use it to express your feelings, thoughts, reasoning or wishes regarding the provisions of your Will or the administration of your estate, without creating additional legally binding obligations.

A Memorandum of Wishes can therefore be a useful way to provide further context or guidance to your executor or trustees. For example, you may wish to:

• detail your wishes for your funeral;
• explain how you would like your beneficiaries to use their inheritance;
• provide guidance to the guardians of your minor children about how you would like your children to be raised; or,
• leave non-binding instructions regarding the care or ownership of your pets.

Including these directions in a Memorandum of Wishes allows you to communicate your expectations while keeping them separate from the legally binding provisions of your Will.

Conditional Gifts

You may wish to leave a conditional gift in your Will. This is a gift that is subject to a specified condition.

There are two types of conditions gifts:

• Conditional precedent: an event or action must occur before the beneficiary becomes entitled to the gift; and
• Conditional subsequent: the beneficiary receives the gift, but their entitlement will come to an end if a specified event occurs.

While conditional gifts can provide a way to reflect specific wishes, they must be carefully drafted. A condition may be ineffective if it is uncertain, impossible to fulfil or contrary to public policy.

The consequences can also differ depending on the type of condition. If a condition precedent is invalid, the gift may fail and form part of the residuary estate instead. If a condition subsequent is invalid, the gift may take effect without the condition needing to be satisfied.

Examples of Conditional Gifts

Courts in Australia have considered several unusual conditional gifts, demonstrating why careful drafting is important.

In the NSW Supreme Court case of Hickin v Carroll & Ors [2014], a gift was made conditional upon the Willmaker’s adult children converting to a particular religion within three months of his death. Whether the condition was against public policy was a contested matter. However, the Supreme Court deemed that restraining someone’s religion is only contrary to public policy if it limits the parental right to raise a child in a specific faith. Because the condition was held to be valid, the beneficiaries lost their gifts when they failed to comply.

An example of a failed condition subsequent gift occurred in the case of Hibbit v Ziade [2022] which concerned a gift of a residence and its contents to beneficiaries “in return for caring for my two cats”. It was argued that the beneficiaries would not receive the gift until the cats had died. The Court rejected that interpretation and found that the gift vested immediately, avoiding the practical difficulties that a deferred gift would have created.

These cases demonstrate that while conditional gifts can be an effective way of expressing testamentary wishes, the wording and practical effect of a condition matter. What may seem straightforward when written into a Will can become considerably more complicated when its meaning is tested after death.

Make it Personal – But make Sure it Works

Making a Will does not need to be a daunting or purely practical exercise. Whether your wishes are traditional, sentimental or a little unconventional, your Will gives you an opportunity to communicate what matters to you and make your wishes known.

The important thing is to make sure those wishes are expressed clearly and legally effectively.

Contact us to discuss all your wishes and how to put them into effect.

The post Will Power appeared first on Tony Kelly Lawyer & Estate Planner.

Choosing the right person or persons to act as your attorney is an important decision. Your attorney may have significant authority over your affairs, so it is important to understand the different types of Powers of Attorney and consider which arrangement is right for you.

What is a Power of Attorney

A Power of Attorney is a legal document that allows you to appoint a trusted person to make financial and/or personal decisions on your behalf.

Putting a Power of Attorney in place means that, if circumstances arise where you cannot attend to your affairs yourself, the person you have chosen will step in and act on your behalf. This may include managing your finances, dealing with your property or arranging personal services and support.

What are the types of Power of Attorney

There are two main types of powers of attorney to consider in Victoria;

1. General non-enduring Powers of Attorney

A General non-enduring Power of Attorney allows you to appoint an attorney to make financial and/or personal decisions on your behalf for a specified period or purpose. Importantly, it does not continue if you lose decision-making capacity.

This can be useful where you need someone to act on your behalf temporarily or in particular circumstances. For example:

• Extended overseas travel: If you intend to travel overseas for several months, you may wish to appoint an attorney to manage payment of your bills, banking or matters relating to your property while you are away.
• Temporary illness or hospitalisation: If you are buying or selling property but are unable to attend settlement or sign documents yourself, you may appoint an attorney to act on your behalf for that transaction.
• Business or financial matters: If you are unable to attend to a particular business or financial matter yourself, you may appoint an attorney to deal with that matter on your behalf.

A General non-enduring Power of Attorney can be tailored to specify when it begins, the decisions your attorney can make and when the appointment ends. If you wish for your attorney’s authority to continue if you lose capacity, an Enduring Power of Attorney may be more appropriate.

2. General Enduring Powers of Attorney

An Enduring Power of Attorney allows you to appoint someone to make financial and/or personal decisions on your behalf, including if you lose decision-making capacity. This can be particularly important when planning for the possibility of illness or injury that may affect your ability to make decisions in the future.

Depending on the authority given to your attorney, they may be able to:

• manage your bank accounts and pay your expenses;
• deal with your property and other financial assets; and,
• make decisions about your personal services, support and living arrangements.

The key feature of an Enduring Power of Attorney is that it will continue to operate if you lose decision-making capacity. This allows you to make an important decision while you have capacity: choosing who you trust to make financial and/or personal decisions for you, should you no longer be able to make those decisions for yourself.

One aspect to note is that a Power of Attorney for financial and personal matters is also distinct in Victoria from an Appointment of Medical Treatment Decision Maker, which covers medical decisions.

Who can be an Attorney

Choosing who to appoint as your attorney is an important decision. Your attorney should be someone you trust to act honestly, responsibly and in accordance with your wishes and best interests.

You may wish to consider;

• whether the person understands your wishes and values;
• whether you trust them to manage your financial affairs responsibly;
• whether they are likely to be available to assist you; and
• whether they have the time, ability and willingness to take on the responsibility.

In Victoria, you can appoint up to four people to act as your attorneys. If you appoint multiple attorneys, you can specify how they are to exercise their authority. For example, you can require your attorneys to:

• act jointly: all attorneys must agree and act together;
• act severally: each attorney can make decisions independently;
• act jointly and severally: attorneys can act together or independently; or
• act by majority: a majority of all the attorneys must agree before a decision can be made.

It is therefore important to consider not only who you appoint, but also how you want them to exercise their authority.

Planning ahead

Making a Power of Attorney is an important part of planning for your future. A carefully considered Power of Attorney can provide greater certainty for you and your family and help ensure your affairs are managed in accordance with your wishes if your circumstances change.

If you are considering making or updating a Power of Attorney, obtaining legal advice can help ensure the arrangement is appropriate for your individual circumstances. Contact us today to discuss making or updating your Power of Attorney.

The post Choosing your Power of Attorney appeared first on Tony Kelly Lawyer & Estate Planner.

AI can generate what appears to be a straightforward Will, identifying beneficiaries, appointing an executor and setting out how your estate should be distributed. However, a Will is more than a document that records your wishes. It is a legal document that must satisfy specific requirements to operate effectively after your death.

How to effectively utilise AI when preparing your Will

There is nothing inherently wrong with using AI as a starting point when considering your estate plan. AI can help you identify questions you may wish to discuss with a lawyer, organise information about your assets and family circumstances, or help understand some of the terminology involved in estate planning.

The risk arises when an AI-generated document is treated as a substitute for tailored legal advice. Your family circumstances, assets and wishes are unique. A properly prepared Will should take these circumstances into account and ensure your wishes are expressed in a way that is legally effective.

An AI model may not consider all of the potential legal issues associated with your Will, including:

• Taxation issues and how your Will can best be structured for tax-effectiveness, including the use of discretionary testamentary trusts;
• Asset protection concerns for you and your family;
• Particular circumstances that may require a tailored approach for a specific beneficiary, such as disability or being in receipt of an asset-tested pension; or
• Risks associated with excluding any beneficiary from your Will.

There is also a risk with any homemade Wills that they will not be executed correctly to meet the requirements of the Wills Act. This can lead to issues with proving valid execution to the Probate Office (meaning more time and expense for your Executors), and even a risk that a Will is found to be invalid in its entirety.

What happens when a Will is found to be invalid?

If a Will is found to be invalid, and you have no prior valid Will, your estate will instead be administered under the laws of intestacy, governed by the Administration and Probate Act. This means your assets will be distributed according to statutory provisions rather than the wishes you intended to express.

The courts have considered the validity of Wills in circumstances involving digital documents. For example, in the case of Peek v Wheatley [2025] the Court invalidated the deceased’s Will on the basis that its digital format did not reflect a definitive testamentary intention to act as a Will, but rather reflected a preparatory step in the process.

This case highlights an important point: creating a document that looks like a Will is not necessarily the same as creating a legally effective Will.

The financial costs of an AI-generated Will

One of the reasons people turn to AI tools is to avoid the cost of obtaining professional legal advice. However, the initial saving may not reflect the potential cost of problems arising later.

While an AI-generated Will may cost little or nothing to prepare, questions about its validity or interpretation can result in significant legal costs for your estate. This may include the cost of obtaining legal advice, gathering evidence, interpreting the document and, where necessary, making an application to the Court for a ruling on its proper meaning.

There may also be financial consequences associated in delays in administering the estate. Beneficiaries may have to wait longer before assets can be transferred or distributed, while property or other estate assets may remain unresolved while the legal position is determined.

The cost of a Will should therefore not be measured only by what it costs to prepare, but also by the consequences if it does not operate as intended.

The time, stress and administration for your loved ones

An AI-generated Will may appear appealing because it can be prepared quickly and from the comfort of your own home. However, the convenience of creating the document may shift the burden onto your loved ones after your death.

If a person dies without a valid Will, their estate may need to be administered under the intestacy provisions. This may mean that their assets may be distributed to people who were not their intended beneficiaries, which can lead to disharmony within the family.

The administration of an estate can take many months, and more complex estates may take considerably longer to resolve. What may take only minutes to generate can create months of additional time, expense and stress for your loved ones.

When it comes to your Will, convenience should not come at the expense of certainty. Contact our team today for a no-obligation consultation around your new Will.

The post AI-Generated Wills: Are You Really Protecting Your Family? appeared first on Tony Kelly Lawyer & Estate Planner.

If subsequent to your death the benefits are paid to a “non-tax dependant”, such as an adult child or the executor of your estate, there is a taxable component of 17% (inclusive of the medicare levy) which is payable on the distributed amount.

Example:

A 75-year-old client suffered a relapse of a cancerous condition which had been in remission. As the medical prognosis was for a limited further life expectancy, he didn’t wish to undergo any further treatment. His wife had predeceased him and he had one adult non-dependent son and two infant grandchildren. Before he died we prepared a new Will for him which provided for a discretionary testamentary trust with his son and grandchildren as the primary beneficiaries as to the capital (referred to as a bloodline trust). His superannuation nomination was changed so that his superannuation member benefits were paid to his estate. Accordingly his benefits formed part of the bloodline trust subsequent his death resulting in enhanced asset protection and taxation benefits for his son and grandchildren.

When he contacted us, his self-managed superannuation fund (SMSF) had assets which consisted of cash on deposit, public company shares and a commercial property which had been his business premises, but which was rented to the subsequent business owner.

As he was in pension mode regarding the payment of his member benefits, his stock broker was instructed to transfer the public company shares from the SMSF into his name by way of an off market transfer. He also took the cash out of the SMSF bank account and put it into his personal bank account. The property was then transferred (also in specie) into his own name. None of these transactions incurred any capital gains tax (CGT) or, in the case of the transfer of the property, any Victorian Stamp Duty.

At the commencement of the exercise, the superannuation fund balance totaled $3,253,295.

Within this balance, the taxable component of his benefits was $923,919, resulting in a Future Death Benefit Tax (FDBT) liability of $138,588 if the benefit were paid to the Estate in accordance with his latest Binding Death Benefit Nomination. The difference in the taxable component was because the building held by the SMSF used to be his business premises which some years before he had transferred into the SMSF.

Prior to his death a total of $1,932,991 was taken out to deplete the taxable components, therefore minimizing the future taxable portion of the fund to $23,520, which lowered the potential FDBT from $138,588 to $3,528 achieving a net tax saving of $135,060.

On his death, the assets formerly held as part of his member benefits by the SMSF (the public company shares and the commercial premises) together with the sale proceeds of his residence and other personally held assets all became assets of the discretionary testamentary trust without incurring either CGT or Victorian Government stamp duty. Any future CGT incurred by the Trust would be on the increase in value of the assets from the time when they were transferred into his name, with a 50% discount on any gain which could be split between the beneficiaries of the discretionary testamentary trust.

If you are seeking Estate Planning advice concerning assets inside superannuation (or otherwise), contact our team today.

The post When should you take your superannuation benefits out of the fund? appeared first on Tony Kelly Lawyer & Estate Planner.

When it comes to estate planning, the smallest details can make a huge financial difference. A recent case handled by our boutique firm of wills and probate lawyers in Melbourne highlights how careful planning, timely action, and expert guidance can protect your loved ones from unnecessary taxes and maximise inheritance.

The Client’s Situation

Our client was 93 years old, with his wife pre-deceased, three adult daughters, and a significant asset portfolio. Having already transferred a substantial public company share portfolio out of his Self-Managed Superannuation Fund (SMSF) into his own name, the remaining major asset was an inner suburban warehouse valued at approximately $3 million.

At this stage, he was in palliative care following a heart attack and had expressed that he felt it was “time” to go. With such circumstances, there was an urgency to ensure his assets were structured efficiently to protect his family.

The Challenge

The warehouse property had not been transferred into his personal name because he had lost the title. He had been informed that replacing the title and transferring the property could be a lengthy process. Without timely action, the property could have remained “inside” the SMSF, which would have created significant tax consequences for his daughters upon his passing.

Had the property stayed in the SMSF, the Victorian Government Stamp Duty alone would have exceeded $300,000.

The Solution

We stepped in as his estate planning lawyers, replacing the title and transferring the property into his name efficiently and without delay. This proactive action saved the family $450,000 in taxes at just the 15% rate.

Shortly after the transfer, the client passed away. Thanks to the estate planning structures we had established, his daughters had multiple options for handling the warehouse:

• Retain the property as an asset within the discretionary testamentary trusts created in his Will.
• Sell the property capital gains tax-free and either take all or part of the sale proceeds or reinvest and distribute income to their children in a tax-efficient manner.

By comparison, if the funds had been invested through a standard discretionary “family” trust instead of one established via the Will, each child would have only a $500 tax-free threshold, with marginal rates up to 47% applied thereafter.

Key Takeaways

This case highlights why engaging an estate planning lawyer early is critical, particularly for clients with complex assets such as:

• Self-Managed Super Funds (SMSFs)
• Commercial or high-value property
• Public company share portfolios

Proactive estate planning allows families to:

• Avoid unnecessary tax liabilities
• Protect wealth for future generations
• Ensure assets are distributed according to the client’s wishes

Working with will and estate lawyers ensures your estate plan is carefully structured, legally sound, and tailored to your family’s needs.

Why Work With Our Wills and Probate Lawyers in Melbourne

Navigating the legal and tax implications of an estate can be complex. Our boutique firm provides guidance on:

• Estate planning and succession strategies
• SMSF asset transfers and tax minimisation
• Establishing testamentary discretionary trusts
• Updating Wills and binding death benefit nominations

By planning ahead, you can protect your assets, minimise tax exposure, and ensure your loved ones benefit exactly as you intend.

Take Action Today

Estate planning is about more than documents — it’s about safeguarding your family’s financial future. If you want personalised and bespoke guidance on how to structure your estate, speak to our estate planning lawyers today.

Contact Tony Kelly Lawyer now.

The post How Estate Planning Lawyers in Melbourne Saved a Family $450,000 appeared first on Tony Kelly Lawyer & Estate Planner.