Combining legal and specialist tax advice for executor clients to avoid estate insolvency

I worked with clients who were the executors of their father’s estate – they came to Mullins as they were dissatisfied with the service provided by their previous lawyer.

They were involved in a dispute with one of their siblings who had effective control over a related family trust. The trust owed money to the estate, however, the sibling refused to co-operate with my clients’ request for information.

My clients’ goal was to resolve the dispute, finalise the administration and distribute the estate to the beneficiaries as soon as possible.

I encouraged my clients to seek specialist tax advice, which uncovered a significant tax debt. With the estate facing insolvency, my clients (as executors) were now also facing a significant risk of personal liability for the tax debt.

I advised the clients to make voluntary disclosure to the ATO with the assistance of a specialist tax advisor and simultaneously negotiated a settlement with the sibling and other estate beneficiaries.

The financial outcomes were positive for all involved. The tax debt and the associated personal risk were eliminated, the dispute involving the related family trust was settled by agreement and the estate was distributed in accordance with the deceased’s Will.

“The content of this publication is for reference purposes only. It is current at the date of publication. This content does not constitute legal advice and should not be relied upon as such. Legal advice about your specific circumstances should always be obtained before taking any action based on this publication.”
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