Inheritance Settlement: Australia vs. Japan

Hi I’m Thea, Client Relationship Manager at Legacy Tomodachi. I’m from the slow-paced beach city of Perth, Australia, and also spent a few years working for city government in Kagoshima, Japan. Having focused on legal studies while in university and working with clients from all parts of the world, I am fascinated seeing how different the law is in different countries.

As an Aussie I was interested to see just how different my home country’s laws are to Japan when considering inheritance.

From the get go, one large difference is that Japanese inheritance laws are applied nationwide. In Australia, inheritance is legislated separately by each State.

For this post I looked at the legal procedures of New South Wales or NSW, the Australian state where Sydney is located. Here’s what I found when I looked into the differences between inheritance procedures in these two jurisdictions.

Making a will

If you want to make a will in New South Wales, the process is a lot simpler than when making one in Japan. You can make a will yourself or get legal assistance in creating it, but there is only really one “type” of will in NSW. Conversely, in Japan there are different styles and processes of will creation.

For a will to be valid in NSW, it must follow the requirements of a piece of legislation called the Succession Act 2006. Some basic requirements include that it must be in a written format (as opposed to verbal) and signed by the testator and witnesses.

Japan is much stricter in this regard, requiring each separate type of will to be written in a different and particular style.

In NSW, two witnesses are required when creating a will, and they cannot be any of the will’s beneficiaries.

Depending on the type, Japanese wills may actually not require a witness (having witnesses for a secret will would defeat the purpose anyway).

Australian wills usually name an executor, although it isn’t a requirement, while in Japan it’s actually rare to include them. In NSW, once the will is written and signed then it is valid until it is changed or cancelled by the testator. Interestingly, unless it fits certain conditions, it will also most likely be revoked when the testator gets married.

In Japan, marriage does not affect the validity of the will, highlighting a big difference between the two systems.

Dying without a will

(intestacy)

When someone dies without leaving a will in NSW, their estate goes to the legal heirs as defined in the Succession Act mentioned above. Because if there is no will then there is no executor, an eligible person may apply to the courts for “letters of administration”. This document is used so that the inheritance may be divided amongst the heirs (although this isn’t always necessary, it all depends on the assets involved).

How the estate is divided is decided by law and is just as complex as the Japanese system. Like an executor, it’s up to the administrator to collect the assets and distribute them to the heirs. The administrator must pay all of the deceased’s debts before moving to distribute the assets, and must also follow certain rules.

In Japan, if a will cannot be found, the heirs and the division of the estate are also determined by law. Let’s say for example Taro Suzuki dies without a will and his wife Hanako Suzuki and their two children are the legal heirs. Taro had 5 real estate properties, two bank accounts, and also owned stocks.

According to Japanese law, Hanako gets 1/2 and her two children split 1/2 of Taro’s estate. But who gets what specific real estate, what sum of money and control of what stocks isn’t precisely decided by the law. That is instead decided through an “Agreement on Division of Inheritance” or isan bunkatsu kyogisho, a legal document that all the heirs must agree to and sign. If an Agreement on Division of Inheritance can’t be created for whatever reason, the situation must be resolved through the Japanese family court system.

Something very different between Japan and NSW regarding intestacy is that in most cases in NSW, a spouse is entitled to inherit 100% of an estate.

In Japan in the case that a married couple have children they will always split the estate with them as described above.

The definition of “spouse” is also a lot broader in NSW than in Japan and multiple spouses are also accounted for in the legislation. In Japan the definition of the word spouse or haiguusha remains limited to those who are married.

Dying with a will

If you’re named as the executor of a will in NSW, then you have a lot of work ahead of you. First you must find the will and apply for the deceased person’s death certificate. After that you need to get a grasp on what property and debt the deceased had, determine that value, and then apply for probate if necessary.

This process may also involve first making a notice of intention on the online registry of the Supreme Court. After that a number of documents will be required to be filed at a place called the Probate Office. From there, executor’s pay a filing fee that is determined based on the value of the estate. If the will is found valid and probate is granted then they can go ahead and distribute the estate.

For Japan, if the deceased left a will by notarized document then there’s no major steps you need to take. However in the case of a holographic will or secret certificate will, you will have to gather a variety of documents and then submit them to the family court that presides over the deceased’s final residential address.

Then after about a month, the family court will send a notice of the date that the will goes into probate. On that date, the applicant must bring the will with them to family court. Only the applicant needs to be in attendance, which means all the heirs do not need to gather. If the family court grants probate, then the will will be attached with a probate certificate and all the documents will be returned. From there, the heirs can proceed with claiming their portion of the deceased’s assets. Leaving a notarized will helps heirs avoid this long process.

Transferring property to heirs

To transfer real estate from a deceased person in NSW, depending on whether or not the deceased left a will, either a valid will or “letters of administration” will be required. Either of these documents, as well as other materials, such as a notice of death, death certificate, or certificate of title etc. must be lodged with the government.

However in contrast to Japan, in Australia there are actually two types of real property ownership. One of them (joint tenancy) involves automatically transferring all rights to the other owner upon death, making life easy!

Unfortunately, in Japan there are no automatic transfers. In Japan you have to register the transfer of ownership for real estate property at the Legal Affairs Bureau. The application differs depending on the nature of the inheritance and takes at least 2 weeks.

Getting assistance from a legal professional will help ensure this process goes smoothly. That is one of our main focus areas here at Legacy Tomodachi, and we name several major real estate brokers and nationwide banks among our clients.

Accessing bank accounts

For NSW, if you’ve already obtained letters of administration or probate, you can go to the bank to fill out a withdrawal form and withdraw the funds. If not, they can sometimes release funds upon the submission of other documents, such as a death certificate and consent forms. After looking into a few banks, it seems like the process differs slightly for each bank.

In Japan similarly to the case of real property, the process differs depending on the nature of the inheritance and it may also differ from bank to bank. You will need to gather several documents, submit them to the bank, and wait for them to complete a review process for them to release the funds and close the account. What documents you need depends on whether:

  • if there was a will or not
  • if it is an executor or an heir applying
  • if there is an Agreement on Division of Inheritance and/or relevant court documents

Summary

There are some similarities and many differences between the state of New South Wales and Japan’s inheritance procedures. In both regions, the process is complex and depends heavily on the assets involved. Hiring a legal professional is recommended in both NSW and Japan to make the life of your family easily during this difficult time. Legacy Tomodachi is experienced in assisting in inheritance settlement for Australian and other foreign nationals residing in Japan. If you are looking for related services, contact us today to schedule a free consultation.

Disclaimer: Information regarding inheritance procedures in New South Wales, Australia is included for informational purposes based on official government sources, but does not constitute legal advice. Thank you for your understanding.