Letter of Wishes (Australia)

A Letter of Wishes in Australia records arrangements for dealing with a person's estate and the distribution of assets among beneficiaries, consistent with succession requirements under the Succession Act 2006 (NSW).

Australian estate planning practitioners across all states and territories use the Letter of Wishes alongside formal estate documents to address matters that cannot easily be incorporated into a legally binding instrument. Common topics include funeral and burial or cremation preferences, instructions for the care of pets or dependants, guidance on the distribution of sentimental personal items not specifically bequeathed in the Will, personal messages to family members or beneficiaries, and explanations for decisions in the Will that might otherwise cause confusion or dispute. The document fills a genuine practical gap: Wills are formal, public instruments administered by the Supreme Court of each state through its probate jurisdiction, whereas a Letter of Wishes is private, flexible, and can be updated at any time.

For discretionary family trusts — governed by the Trustee Act 1925 (NSW), Trustee Act 1958 (Vic), Trusts Act 1973 (Qld), Trustees Act 1962 (WA), and equivalent state Acts — a Letter of Wishes from the settlor or appointor is particularly important. The trust deed grants trustees broad discretionary powers over income and capital distributions, and the Letter of Wishes communicates how the settlor would prefer those powers to be exercised for different beneficiaries at different stages of their lives. While the trustee retains full legal discretion, Australian courts have held that trustees must at least consider a genuine Letter of Wishes when making distribution decisions.

The Australian Taxation Office (ATO) administers capital gains tax on the disposal of estate assets under Part 3-1 of the Income Tax Assessment Act 1997 (Cth), and superannuation death benefits under the Superannuation Industry (Supervision) Act 1993 (Cth). A Letter of Wishes can provide the executor with context when making decisions that carry tax implications — for example, the optimal timing of asset sales relative to the estate's tax year, the allocation of capital gains between residuary beneficiaries, or the handling of unrealised losses. The Privacy Act 1988 (Cth) and the Australian Privacy Principles (APPs) administered by the Office of the Australian Information Commissioner (OAIC) apply to personal data held by executors and administrators, including the contents of the Letter of Wishes itself. Executors must manage estate records containing personal information in accordance with APP 11 (security of personal information) and disclose the document only to those with a legitimate need.

Forms-legal.com provides this Australian Letter of Wishes template as a starting point for estate planning documentation, suitable for use across all states and territories for both simple estates and complex discretionary trust arrangements.

A Letter of Wishes (Australia) should be prepared whenever a person finalises or updates a Will, establishes a discretionary trust, appoints a new trustee or executor, or makes any significant change to their estate plan. Australian estate planning solicitors routinely recommend drafting the Letter of Wishes at the same time as the Will so that the executor has full personal context available from the moment they need to act.

The document is particularly valuable in several distinct situations. When a Will contains a discretionary residuary clause — common in family trusts and blended family arrangements — the Letter of Wishes guides the executor and trustee without creating legally binding obligations that could constrain their ability to respond to changed circumstances. Under Part 3.2 of the Succession Act 2006 (NSW) and equivalent family provision legislation in all other states and territories, eligible persons may apply to the Supreme Court for a larger share of the estate; a Letter of Wishes explaining the reasoning behind testamentary decisions can significantly reduce the risk of a successful family provision claim.

When a discretionary family trust is in place under the Trustee Act 1925 (NSW) or equivalent state legislation, the trustee needs to understand the settlor's intentions for distributing income and capital among a broad class of beneficiaries that may include children, grandchildren, and other relatives. The Letter of Wishes communicates those intentions without constraining the trustee's legal discretion, which is essential for the trust to achieve its asset protection and tax planning purposes under the Income Tax Assessment Act 1997 (Cth).

Funeral and burial preferences should be recorded in a Letter of Wishes rather than a Will, because Wills are often not read until after funeral arrangements are made. State coroner legislation — including the Coroners Act 2009 (NSW) and Coroners Act 2008 (Vic) — and the relevant Burial and Cremation Acts govern the handling of remains, and a written statement of preferences prevents family conflict at the most difficult time. When assets of sentimental but modest monetary value — family photographs, jewellery, tools, sporting equipment — are not worth including as specific bequests in a Will, a Letter of Wishes directs the executor informally. Under the Succession Act 2006 (NSW), personal chattels pass under the residuary clause unless specifically bequeathed.

The Letter of Wishes should be reviewed and updated after every major life event: marriage (noting that under s 12 of the Succession Act 2006 (NSW) and equivalent provisions, a Will executed before marriage is revoked on marriage unless made in contemplation of that marriage), divorce, birth of a child or grandchild, death of a named executor, or a significant change in asset composition including superannuation and property holdings. The ATO and state revenue offices administer duty and tax concessions that may affect the optimal structure of estate distributions, and periodic review with a qualified Australian estate planning solicitor is advisable.

A well-drafted Australian Letter of Wishes should address the following elements to give maximum practical guidance to executors, trustees, and family members across all Australian states and territories.

1. Opening declaration — State clearly that the document is not legally binding, is supplementary to the Will dated [date] executed under the Succession Act 2006 (NSW) or equivalent state Act, and reflects personal wishes and guidance only. Identify the writer's full legal name, address, and date of birth to link the letter unambiguously to the correct testator.

2. Funeral and burial preferences — Record specific preferences for burial or cremation, the type of service (religious or secular), preferred location, music, readings, and any cultural or religious customs. The Burial and Cremation Act 2013 (Vic), Cemeteries and Crematoria Act 2013 (NSW), and equivalent state Acts govern these arrangements, and the executor generally has the right to make decisions regarding the body. A clear written statement reduces family conflict at a vulnerable time and requires the executor can act decisively.

3. Personal and sentimental items — Provide a detailed list of items of sentimental value not covered by specific bequests in the Will, with the suggested recipient and the reason for that preference. Items may include jewellery, photographs, artworks, tools, sporting equipment, and household objects. Under the Succession Act 2006 (NSW) and equivalent state succession Acts, personal chattels not specifically bequeathed pass as part of the residuary estate, so this informal guidance supplements the formal Will.

4. Guidance on trustee discretions — For discretionary trusts governed by the Trustee Act 1925 (NSW), Trustee Act 1958 (Vic), Trusts Act 1973 (Qld), or equivalent state legislation, specify how income and capital should be distributed among the class of beneficiaries at different life stages, taking into account their individual circumstances, education needs, business involvement, and the settlor's long-term intentions. Note any beneficiaries with special needs or financial vulnerability. The trustee retains full legal discretion but Australian courts expect the trustee to genuinely consider the Letter of Wishes.

5. Care of dependants and pets — Identify any dependants with special needs, preferred caring arrangements, and expected financial support from the estate. Include full names and contact details of preferred carers. For pets, record dietary requirements, veterinary preferences, and re-homing instructions. An Advance Care Directive under the Medical Treatment Planning and Decisions Act 2016 (Vic) or equivalent state legislation is a separate document covering personal health decisions, but the Letter of Wishes can reference it.

6. Digital assets and accounts — List online accounts, cryptocurrency wallets, subscription services, business accounts, and social media profiles with guidance on whether each should be closed, memorialised, or transferred. Record the location of any password manager, hardware wallet, or secure document storage used to access these assets. The ATO treats certain digital assets as capital gains tax assets under the Income Tax Assessment Act 1997 (Cth), and the executor needs to be aware of these obligations.

7. Messages to beneficiaries — Include personal messages explaining the rationale behind specific bequests, exclusions, or unequal distributions. Under Part 3.2 of the Succession Act 2006 (NSW) and equivalent state family provision legislation, eligible persons may challenge the Will if they are not adequately provided for. A clear, respectful explanation of testamentary decisions — documented in the Letter of Wishes — provides context that can reduce the likelihood of a successful family provision claim.

8. Location of key documents — Note the physical and digital location of the original Will, trust deeds, property titles, mortgage documents, insurance policies, superannuation binding death benefit nominations, share certificates, and other important documents. Identify the name and contact details of the solicitor holding the original Will.

9. Superannuation guidance — Superannuation does not automatically form part of the estate and is distributed at the trustee's discretion under the Superannuation Industry (Supervision) Act 1993 (Cth) unless a valid binding death benefit nomination is in place. The Letter of Wishes can record preferred beneficiaries for superannuation death benefits, which the trustee will consider alongside any binding or non-binding nomination.

10. Review and update statement — Confirm the date, the writer's full name, and state that this Letter of Wishes may be updated at any time without formal execution requirements. Note that each update should be dated and stored with, or communicated to, the executor. Forms-legal.com provides this template as a starting point for Australian estate planning documentation.