Australia hosts a fast-growing Indian-origin population, particularly in Sydney, Melbourne, Perth, and Brisbane. The Australian succession framework — state-based probate plus the unique superannuation system — requires distinct planning. A clear walkthrough.
Australia, like Canada, has neither federal estate tax nor federal probate. Succession matters are governed at the state and territory level — New South Wales, Victoria, Queensland, Western Australia, South Australia, Tasmania, Australian Capital Territory, and Northern Territory each have their own Wills and Succession statutes.
Most state succession laws have been broadly harmonised through model legislation, but differences persist — particularly around the rules for ineffective Wills, intestacy distribution, and family provision claims (formerly called 'testator's family maintenance').
For NRIs in Australia, the relevant state is generally the state of habitual residence at the time of death. Sydney-based NRIs are governed by NSW law; Melbourne by Victorian law, and so on.
Probate is granted by the Supreme Court of the relevant state. The process is generally efficient — uncontested grants typically issue within 6-10 weeks of application. Probate fees vary by state and by estate value but are modest compared to Canada's EAT or the US's variable state-level costs.
Where assets are held in multiple states, separate probate (or 'resealing' of one state's probate in another) may be required. For NRIs with property in Sydney and an investment account in Brisbane, the executor needs to navigate two state processes.
Probate is usually but not always required. Small estates (below state-specific thresholds, often AUD 50,000-100,000) can sometimes be administered without formal probate. Bank discretion plays a role — banks may release small balances on production of a death certificate and a Will.
Australian superannuation (the compulsory retirement savings system) sits outside the deceased's estate for legal purposes. Super death benefits are paid by the trustees of the super fund based on the rules of the fund's trust deed — not according to the Will.
Each super fund offers members the ability to make a 'binding death benefit nomination' (BDBN) — a direction to the trustees about who should receive the death benefit. If the nomination is valid and current, the trustees must follow it. If there is no valid nomination, the trustees decide at their discretion.
For NRIs with substantial super balances (often AUD 200,000 to AUD 1 million by mid-career), the BDBN is one of the highest-leverage estate-planning actions available. Without it, the super balance may not pass as intended. With it, the disposition is locked in.
Australian super law restricts who can receive death benefits. The benefit can be paid to a 'dependant' — defined as a spouse, child, financially dependent person, or someone in an 'interdependency relationship' with the deceased. It can also be paid to the deceased's legal personal representative (estate).
Tax treatment of super death benefits varies. Benefits paid to a 'tax dependant' (broadly, spouse and financially dependent children under 18) are tax-free. Benefits paid to non-tax-dependants (adult children, parents) are taxed at 17% (or 32% if the benefit includes an untaxed element).
For NRIs with adult children inheriting super, the 17% tax is material. Planning around this — perhaps directing super to the spouse rather than children, or paying through the estate to non-tax-dependant beneficiaries via the Will — is a recurring issue.
Australia, like Canada, does not have an inheritance tax. But the capital gains tax (CGT) regime treats the death of a Australian-resident taxpayer differently — for most assets, there is a 'CGT rollover' on transfer to the executor and from the executor to beneficiaries. The gain crystallises only when the beneficiary later sells.
The principal residence exemption applies — the main home is generally exempt from CGT. For families with substantial investment property portfolios, the deferred CGT can be significant when the beneficiaries later sell.
For NRIs returning to India before death, the residence status can change. Australian tax residents are taxed on worldwide gains; non-residents have limited Australian-source-gains-only taxation. Timing of departure affects what is in scope.
Every Australian state allows certain eligible persons — spouses, children (including adult children), de facto partners, and in some states a wider class — to apply for 'family provision' if the Will does not adequately provide for them. The court can order provision from the estate even where the Will is otherwise valid.
Family provision claims are common in Australian probate practice. For NRI families where adult children may feel under-provided for, this is a real risk. NSW and Queensland in particular have permissive family provision jurisdictions.
Drafting strategies to minimise family provision risk include explicit reasoning in the Will about why dispositions are structured as they are, gifting during life (which may exclude assets from the estate for provision claim purposes), and using testamentary trusts to give the testator the appearance of leaving assets in the family while controlling distribution.
Most Australian NRIs retain Indian assets — Indian flats, NRE/NRO deposits, mutual funds. These Indian assets are governed by Indian law for succession.
The Australian CGT applies to the deceased's worldwide assets if the deceased was Australian-resident — including unrealised gains on Indian assets. The CGT rollover applies to the deceased-to-executor transfer, deferring tax until later sale.
FEMA / RBI rules govern repatriation of Indian inheritance proceeds. As with other NRIs, repatriation up to USD 1 million per financial year from NRO accounts is permitted with banking-channel compliance.
Standard structure: an Australian Will (state-specific) covering Australian assets, an Indian Will (Section 63 ISA) covering Indian assets, each explicitly preserving the other. The Australian Will should also address the superannuation BDBN — typically by leaving the disposition to the BDBN itself, with the Will operating only if no valid BDBN exists.
The Indian Will should be drafted in coordination with the Australian Will. The Indian executor's role affects both transmission to Australian beneficiaries and FEMA compliance.
Many Australian-based NRIs choose to have their primary Will executed in their state of residence, with the Indian Will functioning as a secondary instrument for Indian-asset specifics. The arrangement works well when both Wills are drafted with awareness of the other.
A meaningful number of Australian-based NRIs operate self-managed super funds — small super funds with up to six members where the trustees are typically family members. SMSFs offer significant flexibility but also additional estate planning considerations.
SMSF death benefits are paid by the trustees of the SMSF. Where the trustees are family members, internal succession questions arise — who controls the fund after the principal member's death? Most SMSFs are structured with corporate trustees specifically to manage this transition cleanly.
BDBNs for SMSFs operate the same way as for industry funds, with the same restrictions on permissible recipients. SMSF advisors typically integrate the BDBN with the broader estate plan.
Vikram and Neha Shah, Indian citizens with Australian permanent residency, both aged 48. They live in Parramatta. Estate: a Parramatta house (AUD 1.6 million), super balances (AUD 450,000 combined), an investment property in Strathfield (AUD 900,000 — generating rental income), Australian shares and ETFs (AUD 380,000), an Andheri flat (₹3.8 crore), NRE deposits (₹70 lakh).
Recommendations: NSW Will covering Australian assets with provision for testamentary trusts for children to manage family provision risk. BDBNs on super funds directing benefits to the surviving spouse for tax-free treatment. Indian Will under Section 63 ISA covering Andheri flat and NRE deposits with explicit preservation of the NSW Will.
Capital gains planning: the Strathfield investment property's gain is deferred via CGT rollover on death, allowing the inheriting beneficiaries to choose timing of disposal. The Andheri flat's gain is also deferred and is subject to FEMA on eventual transmission.
Error one: ignoring the super BDBN. Without a valid current BDBN, the super fund trustees decide who gets the death benefit — and this is one of the most common sources of family disputes in Australian estate administration.
Error two: failing to provide for family provision claims. An adult child who feels under-provided for can challenge the Will under state provision laws and often succeeds in obtaining a court-ordered share.
Error three: not addressing CGT on investment properties. The deferred gain can be substantial, and the beneficiaries inherit the deferred tax liability.
Error four: relying on a single Australian Will to cover Indian assets. The Indian probate court will require an Indian Will (or significantly delayed exemplification of the Australian Will) before Indian assets can transmit.
Australian-based NRIs are one of our growing client segments. The Australian regime rewards coordinated planning — especially around the BDBN, family provision risk, and dual Wills. Most NRI families we encounter have one or two of these elements in place but rarely all three.
Our standard recommendation: Australian Will from a state-specific Australian estate lawyer; binding death benefit nominations on every super fund updated to current intentions; family provision risk addressed through specific drafting or trust structures; Indian Will under Section 63 ISA explicitly preserving the Australian Will.
If you have not addressed your superannuation BDBN in the last three years, please do so — irrespective of the rest of your estate plan. It is the single most impactful action you can take in an afternoon.
Alongside the Will, Australian residents typically execute an enduring power of attorney (for financial matters) and an enduring guardianship (for personal and medical matters). Each Australian state has its own forms and requirements.
These documents take effect during the maker's lifetime if the maker loses capacity — providing the family with the legal authority to manage finances and make medical decisions without court intervention.
For NRI families in Australia with Indian-resident dependents (such as elderly parents), additional cross-border powers of attorney may be useful to authorise the NRI to act on Indian assets while continuing to reside in Australia.
For NRI families operating self-managed super funds (SMSFs), one of the most consequential planning issues is succession of the trusteeship itself. If both members of an SMSF are spouses, and one dies, the surviving spouse must reconstitute the fund's trustee structure.
Corporate trustee structures (rather than individual trustees) make this transition much cleaner — the corporate trustee continues, and the deceased's directorship is simply replaced. Individual trustee structures require fund-level changes that can be administratively complex.
For substantial SMSFs, we routinely see Indian-origin families restructure to corporate trustees specifically to manage succession risk. The cost of restructuring is modest; the avoided administrative friction is substantial.
A testamentary trust — a trust created by the Will, taking effect on the testator's death — is a common feature of higher-end Australian estate plans. The trust holds assets for the benefit of named beneficiaries (typically the surviving spouse and children) under the management of named trustees.
The principal advantage is income tax treatment. Income distributed to minor beneficiaries from a testamentary trust is taxed at adult rates (rather than the punitive minor's rate that applies to ordinary trusts), allowing income-splitting strategies that can generate substantial tax savings over the life of the trust.
Asset protection is another benefit. Trust-held assets are generally insulated from beneficiary creditors and from matrimonial property claims in the event of a beneficiary's divorce. For NRI families with adult children whose financial or marital circumstances are uncertain, this protection is valuable.
A pattern we see frequently among Australian-based Indian families is one parent returning to India for cultural, family, or business reasons while the other remains in Australia with the children. This split-residence pattern creates planning complexity that compounds over time.
For estate purposes, the returning parent's Indian assets grow while the Australian-resident family's Australian assets continue. Each side's Will needs to anticipate the other side's status, with appropriate guardianship and trust provisions if minor children are involved.
These split-residence engagements are among the most rewarding we handle. The planning is intricate but the family clarity that emerges from a coordinated structure is substantial — particularly for the children who may end up navigating both jurisdictions.