There are roughly a million Australians living outside Australia at any given time, and a great many of them are carrying an estate plan that quietly stopped working the day they left. The will is still valid. The superannuation is still there. The house in Brisbane is still in their name. What has changed is the tax treatment, the recognition of the documents overseas, and — most expensively — who is allowed to administer the estate without triggering a tax bill nobody budgeted for.
This is one of the few areas of estate planning where a perfectly well-drafted will can produce a bad outcome purely because of where the people named in it happen to live.
Does Your Australian Will Cover Your Overseas Assets?
Usually, partly. The general principle in cross-border succession is that real property — land and buildings — is governed by the law of the country where it sits, no matter what your will says. Everything else, broadly your movable assets such as bank accounts, shares and personal possessions, is generally governed by the law of the place you are domiciled.
In practice, that means an Australian will can deal with a Singapore bank account reasonably comfortably, but an apartment in France or a condominium in Thailand is a different matter. Some countries apply forced heirship rules that reserve fixed shares of local property for children or a spouse, regardless of what you wrote. You cannot draft your way around that from Australia.
Where there are meaningful assets in two countries, the usual answer is two wills — one for each jurisdiction, each carefully limited to the assets in that country. The trap is the revocation clause. Most wills open by revoking all previous wills, so a second will drafted overseas by a lawyer who does not know about the Australian one can cancel it outright. Both documents must be drafted knowing the other exists, and each must say precisely which assets it covers.
The Executor Problem Nobody Sees Coming
This is the single most common and most costly mistake Australian expats make: appointing an executor who is also living overseas.
If the only executor of an Australian estate is a foreign resident for tax purposes, the estate itself is generally treated as a non-resident trust estate. The consequences are real money:
- The estate loses access to the tax-free threshold that would otherwise apply in the first three income years after death, so tax can start from the first dollar of estate income.
- The 50% CGT discount on assets held longer than twelve months is generally unavailable to a foreign resident, so a share portfolio sold to fund distributions can be taxed at roughly double.
- Refunds of excess franking credits — often a significant part of an older Australian's portfolio income — may be lost.
- Foreign owner land tax and stamp duty surcharges can apply in several states while the estate holds property.
The fix is not complicated: appoint at least one Australian-resident executor alongside your overseas one, or appoint an Australian solicitor or trustee company. It costs nothing to draft and it can save a six-figure estate tens of thousands of dollars. Our guide to choosing an executor covers the rest of the role.
CGT Event K3 — When an Asset Passes to a Foreign Beneficiary
Australia has no inheritance tax, which lulls people into thinking death is tax-free. It usually is, because most assets pass to beneficiaries with the capital gain simply rolled over until they sell. But if an asset passes from the estate of an Australian resident to a foreign resident beneficiary, a rule known as CGT event K3 can apply, and the gain crystallises at the date of death rather than being deferred.
Two details matter enormously here. First, the tax is generally payable by the estate, not by the overseas beneficiary who received the asset — so it comes out of the pool that everyone else was going to share. Second, it does not apply to taxable Australian property, which broadly means Australian real estate. So the family home left to a child in London is treated very differently from the CommBank share parcel left to the same child.
The planning response is usually to give your executor flexibility: draft the will so that an overseas beneficiary can be given cash, or Australian real property, rather than a forced in-specie transfer of shares or managed funds. Writing a bequest as "my BHP shares to my daughter in Canada" removes exactly the discretion your executor needs.
The Family Home You Left Behind
If you keep your Australian home while living abroad and you sell it while you are a foreign resident for tax purposes, you generally cannot claim the main residence exemption at all — not a partial exemption, and not just for the years you were away. There is a narrow "life events" test covering things like death, terminal illness or divorce within a six-year absence, but it is genuinely narrow.
The estate planning implication is that timing and residency status at the moment of sale can matter more than anything in the will. If a property is going to be sold to fund the estate, whether your executor sells it while the estate is a resident or non-resident entity can change the tax outcome substantially. That decision should be made deliberately, with advice, not discovered afterwards.
Superannuation Does Not Follow You — Or Your Will
Your Australian super stays in Australia and, importantly, is not controlled by your will. It is paid according to the nomination you have lodged with the fund. A binding death benefit nomination usually lapses after three years unless it is a non-lapsing one, and expats are precisely the people who forget to renew it because the fund's mail is going to an address they left in 2019.
A death benefit can be paid to a foreign-resident dependant, but the tax treatment depends on whether they qualify as a dependant for tax purposes, not just under super law. If you run a self managed super fund, the stakes are higher again: an SMSF must satisfy residency conditions relating to where the fund's central management and control sits and who is contributing. A trustee who moves overseas indefinitely can put the fund's complying status at risk, with severe tax consequences. Get advice before you leave, not after. We cover the fundamentals in what happens to your superannuation when you die.
Powers of Attorney Stop at the Border
An Australian enduring power of attorney is a state-based document. It is not automatically recognised in Japan, the UAE or the United States, and a foreign power of attorney is frequently rejected by Australian banks and land registries. If you are living overseas and own Australian assets, you generally need an Australian enduring power of attorney, made in the state where those assets are, so that someone here can act for you if you are incapacitated or simply unreachable. Planning for incapacity matters at least as much as planning for death — see our overview of estate planning essentials.
Keeping It All Findable From 14,000 Kilometres Away
Cross-border estates fail on logistics as often as on law. Two wills in two countries, a super fund in Melbourne, an employer scheme in Dubai, a bank in Singapore, a property manager in Perth and an executor in Sydney who has never been told any of it. When something happens, the family's first job is not grief — it is a scavenger hunt across time zones.
That is the problem Custodium Vault is built for. Store your Australian will alongside your foreign will, your enduring power of attorney, your super nominations, your insurance policies and a plain list of every account and property in each country, then nominate exactly who can access it and when. Have a look at how the vault works and the plans available. If life insurance forms part of your plan, our life insurance page explains how cover and estate planning fit together.
If you take one thing from this article, make it the executor point. Check today whether the person named in your will is an Australian resident. It is a five-minute check that is worth more than anything else on this page.
This article is general information only and does not constitute legal advice. For advice specific to your situation, speak with a qualified Australian estate planning lawyer.