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Home › Sell Property › Selling A Deceased Estate [2025 Guide & Tips]
When a loved one passes away, family and friends begin an emotional journey that is often made harder by the long list of things that need to be done. It’s a time when many important decisions need to be made often together with other family members and friends.
One of the most challenging tasks can be administering a loved one’s will and managing their estate. It is not unusual for family to disagree over what should be done or to contest the will. It can be even more difficult when there is no will to communicate a loved one’s wishes. Many times, families decide to sell the estate to avoid complications and stress, especially during an already emotional time.
We have gathered some essential information about selling a deceased estate in this guide to help guide you through the selling process and make the process as stress-free as possible.
Key Takeaways A deceased estate includes all assets and debts left behind. An executor (or administrator) is legally responsible for managing the estate. You cannot sell a deceased estate property until probate or letters of administration is granted. Selling within two years can help avoid capital gains tax. Auctions are often the best option for transparency and avoiding family disputes.
Key Takeaways
Next step: A good real estate agent will be one of the key people helping keep the process as easy as possible. If you would like assistance in finding a suitable agent, you can use our comparison service.
A deceased estate is everything a person leaves behind when they pass away. This can include both assets and liabilities. Typical assets in an estate may include:
The estate also includes debts and liabilities, such as mortgages, credit card debts, and unpaid bills. These must be paid before beneficiaries can receive their inheritance.
In Australia, the estate is legally managed by an executor (if there is a will) or a court-appointed administrator (if there is no will).
Paul Simmons, Managing Director of Barry Plant Bayswater, gives some great reasons why careful selection of a real estate agent before sale of a deceased estate property is paramount.
The executor is the person legally responsible for carrying out the wishes in the will. Their main role is to manage the estate, pay debts, and ensure assets are distributed or sold as instructed.
Without a will, the family member must apply for a Grant of Letters of Administration, which gives them the legal authority to manage the estate.
An executor or personal representative’s duties typically include:
The executor and personal representative roles carry a lot of responsibility and can be very stressful. Not only do they need to manage the demands of family and friends, they also need to ensure assets are well cared for. Problems can arise when an executor or personal representative makes a mistake. For example, if they fail to insure a house and it burns down before being passed on to beneficiaries, an executor is usually liable to compensate all beneficiaries.
When choosing an executor, it is important to choose someone who is capable of handling the responsibilities and often complex tasks of the executor role. If there is concern that a family member or friend will be too distraught or unavailable to fulfil the role of executor, you can choose to appoint an independent executor, such as a public trustee.
A grant of probate is a legal document issued by the supreme court. Its purpose is to confirm that the will is valid and to authorise an executor to carry out the necessary tasks to distribute the estate in accordance with the will.
A will cannot be administered until a grant of probate has been issued. Therefore, it is advisable that an executor applies for it as soon as possible, as it can take 4 weeks or more for the document to be issued.
The grant of letters of administration grants a person the formal right to administer an estate. This is a necessary step when there is no will. As there is no appointed executor, someone must volunteer to administer the will by applying for a grant of letters of administration. In this case, a grant of probate is not required.
Applications for a grant of letters of administration are often more complicated than applications for a grant of probate and can, therefore, take longer. Disputes about who should be legally appointed can often arise and cause even further delays. It is advisable to apply for a grant of letters of administration as early as possible, as the wait can sometimes be up to four months.
When distributing and selling a deceased estate, specific tax rules apply. These vary depending on the specific situation of the people involved, so it is necessary to find out exactly which rules apply. The Australian Taxation Office (ATO) provides detailed information on tax applied during the administration of a deceased estate and are the best place to start if you have tax-related questions. However, we have included some general advice regarding:
If there is no immediate beneficiary, a deceased estate is treated as a trust and the executor as the trustee. The estate is taxed at individual income tax rates for the first three years following a person’s death. The full tax-free threshold applies throughout these three years; however, tax offsets do not. The medicare levy is also not payable. After the first three years, specific tax rates apply, and these can be found on the ATO website.
If estate assets are distributed to beneficiaries, an executor does not need to complete a trust tax return. The beneficiaries are liable for tax and must complete the relevant sections in their individual tax returns. This means that any income earned from the estate is taxed at individual tax rates.
Rules vary depending on whether the beneficiary is under a legal disability or is a non-resident. Therefore, it is essential to check with the ATO to determine which tax rules apply to your situation.
Assets from an estate can pass directly to a beneficiary or directly to an executor who will then dispose of the asset or pass it on to the beneficiary. Capital gains tax is usually paid when the estate, an executor or a beneficiary disposes of or sells an asset, rather then when the asset is received. Any trust tax returns must include capital gains acquired when an executor disposes of an asset.
Capital gains tax can usually be disregarded if you sell within two years of inheriting property from a deceased estate.
Different rules apply to assets purchased by the deceased prior to 19 September 1985 and these can be found on the ATO website.
Australia does not have any inheritance- or estate-specific taxes. However, there are tax concerns that must be handled. Some of these are detailed above; however, the ATO website provides a comprehensive overview of tax rules in relation to a deceased estate and is the best source of tax-related information.
Before selling a deceased estate, you should consider any potential capital gains tax payable, as well as the costs of any necessary repairs to the property. This will help you determine whether it is beneficial to sell the property.
The process for selling a deceased estate is much the same as selling any other property but with some key differences. Here are the usual steps involved in the process:
Various rules exist in regards to selling deceased estates. We have outlined some important information below; however, it is essential that you check with your local state or territory authority to ensure you perform all the necessary steps.
As mentioned, the process and/or laws for selling an inherited property vary from state to state, so it is vital to check the laws in your own state before attempting to sell.
Selling a loved one’s property after they pass away can be a stressful and emotional experience. It can also be time-consuming unless you know the ins and outs of the process, allowing you to streamline where possible. Knowing what to expect and having support where needed will help reduce the burden, speed up the process and give you peace of mind.
This guide provides an overview of important considerations during the sales process of a deceased estate, as well as where you can go for more information. However, a local, experienced real estate agent can provide support and further guidance where needed, so you are able to make fast progress with the sale of the property.
Our comparison service can help you find a real estate agent that is experienced in selling deceased estates in your local area. They will have an understanding of the process within your state or territory and can assist you in any areas that may be unclear.
No, unless the property was held as joint tenants. Otherwise, you must wait for probate or letters of administration.
The estate must cover all debts, including the mortgage, before assets are distributed.
The executor makes the final decision but must act in the best interest of all beneficiaries. Sometimes disputes go to court.
Yes, unless the property is sold within two years of death or other exemptions apply.
Yes, but only with the executor’s approval. Any rent or benefit may need to be declared.
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