For many Filipino-Australians, life is beautifully woven between two cultures, two homes, and often, two sets of responsibilities. It’s a unique position that can also introduce difficult decisions, particularly when it comes to planning for the future and making sure our loved ones are protected.
Dealing with the legal systems of two distinct nations requires careful thought. What might be standard practice in Australia could be quite different in the Philippines, and vice versa. Failing to recognise these distinctions can lead to unintended outcomes, family disputes, and added stress during already difficult times.
As Sarah Corbette from budgetcremation.com.au told us, “I often speak with families about the importance of clear planning. When your life and assets span across countries like the Philippines and Australia, grasping the differences in estate planning laws is very important.”
Succession and Wills: Legitime vs. Testamentary Freedom
One of the most basic differences lies in the concept of succession and Wills. In the Philippines, the law provides for what are known as “compulsory heirs” (e.g., legitimate children and descendants, surviving spouse, and illegitimate children). Under the Philippine Civil Code (Articles 886-914), a considerable portion of an individual’s estate, called the legitime, is legally reserved for these compulsory heirs. This means that even if a Will attempts to exclude a compulsory heir or give them less than their rightful share, the law protects their entitlement to the legitime. This principle greatly limits absolute testamentary freedom.
In Australia, the legal framework generally offers greater “testamentary freedom.” This means individuals have more liberty to decide how their assets are distributed through their Will. But this freedom is not absolute. Australian states and territories have “family provision laws” (or testator’s family maintenance laws) which allow certain eligible persons (like spouses, children, and sometimes dependents) to claim against the estate if they believe they have not been adequately provided for in the Will. This is a key difference.
Treatment of Assets: Superannuation Differences
Another key area of divergence is the treatment of specific assets, particularly superannuation. In Australia, superannuation benefits do not automatically form part of your estate to be distributed according to your Will. Superannuation is usually governed by a trust deed and the Superannuation Industry (Supervision) Act 1993 (Cth). You can often make a Binding Death Benefit Nomination (BDBN) to direct who receives your superannuation benefits upon your death. If no valid BDBN is in place, the trustee of the super fund usually has discretion to decide which of your dependents receives the benefit. This is a concept that may not have a direct equivalent in the Philippine system, where assets are generally pooled into the estate.
Real Property and Foreign Ownership
When it pertains to real property (land and buildings), the rules can also differ considerably, especially concerning foreign ownership or inheritance by non-citizens. The Philippines generally has stricter restrictions on foreign ownership of land compared with Australia. For Filipino-Australians holding property in both jurisdictions, it’s very important to grasp these rules to make sure of a smooth transfer to beneficiaries.
Formalities of Making a Will
The formalities of making a Will also differ. A Filipino making a will abroad can follow the forms of the foreign country where the will is made (lex loci celebrationis); for the will to be effective concerning Philippine assets, it must still comply with Philippine succession laws regarding aspects like legitime. Australia also has specific requirements for a valid will, which vary slightly by state and territory but generally involve the will being in writing, signed by the testator, and witnessed by two adults.
Estate Administration Processes
The process of administering an estate also has its nuances. Both countries have processes for validating a Will (often called probate in Australia) and appointing someone to manage the deceased’s affairs (an executor or administrator), yet the specific steps, timelines, and court procedures can vary.
Seeking Specialised Legal Advice
So, what does this mean for Filipino-Australians? First, it shows the very important need for specialised legal advice. If you have assets in both the Philippines and Australia, it is strongly suggested to consult with lawyers who are skilled in cross-border estate planning and familiar with the laws of both jurisdictions. Organisations like the Filipino Australian Lawyers Association (FALAW) may also offer guidance or resources (SBS Filipino, 2024). You may even require separate Wills for your Australian and Philippine assets, or an international Will, structured to be valid in both countries, though this is a difficult area requiring expert advice.
In the end, taking proactive steps to address these estate planning differences is an act of love and responsibility. It makes sure that your legacy, built across two nations, is managed with consideration, protecting your family and respecting your intentions, no matter where they reside.
