Consider this scenario:
You have 2 children. Child A and Child B.
Child A has one child (your grandchild).
You give your estate equally to Child A and Child B in your Will.
If Child A dies before you, your grandchild will automatically receive Child A’s half of your estate unless there is a contrary intention clearly expressed in your Will.
This is due to section 33N of the Succession Act 1981 (QLD).
Giving half of your estate to your grandchild might reflect your intentions but what if it doesn’t? You may not get on with the grandchild. Your preference may be for Child B to receive the entire estate if Child A dies before you.
It’s important that you carefully document your intentions in your Will so as not to get caught out by automatic gifting rules like section 33N.
With the ageing population and people of advanced years making Wills, we are also seeing an increase in clients intentionally ‘skipping’ their children (who are at retirement age) and gifting the estate to the next generation. The issues to consider regarding this ‘trend’ is the subject of another article.