After the bank validates the death, there is a permanent hold on any transaction accounts, which includes: You can't withdraw money from the accounts.
However, in many cases the only way to legally access money belonging to an estate is to administer that estate and apply for a Grant of Probate. This process is referred to as probate. This process will need to be carried out by either the executor(s) if there is a valid Will, or an administrator if there isn't.
Once you notify us and provide at least one of the Proof of Death documents, then a permanent hold will be placed on any transaction accounts solely held by the deceased. This means: No money can be taken out of the accounts.
How to Withdraw Money From a Deceased Account? Anyone who wants to withdraw money from a deceased account has to produce the death certificate as a basic requirement for all claims. Furthermore, the proof of identity of the nominee or, in the case of another claimant(s), is also required.
If the deceased has named a payable-on-death (POD) beneficiary for the account, the person named will get access to it immediately. They will simply need to show a death certificate and identification to the bank.
If the account holder established someone as a beneficiary, the bank releases the funds to the named person once it learns of the account holder's death. After that, the financial institution typically closes the account. If the owner of the account didn't name a beneficiary, the process can be more complicated.
In Australia, jointly held bank accounts will allow access to the surviving joint account holder, allowing them to release funds when the co-owner person dies.
How Long Do Banks Take to Release Money After Probate in Australia? Generally speaking, once a financial institution has received the required documentation — including a Grant of Probate or Administration — it will release funds in two to three weeks.
If you need to close a bank account of someone who has died, and probate is required to do so, then the bank won't release the money until they have the grant of probate. Once the bank has all the necessary documents, typically, they will release the funds within two weeks.
It is best to think of the decedent's belongings, paperwork, and assets as “frozen in time” on the date of death. No assets or belongings should be removed from their residence. Their vehicle(s) should not be driven. Nothing should be moved great distances, modified, or taken away.
Time frame
If the executor distributes the estate within six months of the date probate was granted and a claim is made for further provision from the estate within the six month period, then the executor may be personally liable for any amounts the court requires the estate to pay.
Inheritance theft can also occur after death if someone takes a physical item that is left to you in the will or if the executor misappropriates the deceased person's assets. Whatever your situation, it is crucial to work with a probate litigation lawyer throughout the process.
Inheriting money and assets
There are no inheritance or estate taxes in Australia.
When you notify the bank of an account holder's death, they will freeze the account and prevent any further payments from being taken in the form of direct debits and standing orders. This also protects the accounts from fraud.
If there is any unpaid debt, then the account balance would be recovered by the creditors. The remaining amount, if any, will be handed over to the kins. If the deceased accounts are pay-on-death accounts, then the bank will hand over the proceeds to the nominee or beneficiary when the account holder gets deceased.
You can ask your bank to provide an explanation for the hold or sometimes even to release the hold. In most cases, you won't be able to do anything about the hold though, and because all banks have them, you can't switch banks to avoid them either.
You'll need to obtain a Grant of Probate or Letters Administration (see 'Additional information' section) if the value of an estate (balance of solely held accounts with us) is more than $100,000, or we have asked you to obtain it.
When an account holder dies, the next of kin must notify their banks of the death. This is usually done by delivering a certified copy of the death certificate to the bank, along with the deceased's name, bank account number, and other information.
Speak with a Financial Information Services Officer before making any final decisions. You need to tell us about changes to income and assets within 14 days.
You should also let the deceased person's bank know. This means that the bank can stop any communications, as well as freezing the account – and stopping any standing orders or direct debits. When you've notified the bank, they can let you know what the next steps will be and which other documentation they might need.
If you're married or in a civil partnership, money in a joint account belongs to both of you equally.
The Trouble With Joint Bank Accounts
The majority of banks set up joint accounts as “Joint With Rights of Survivorship” (JWROS) by default. This type of account ownership generally states that upon the death of either of the owners, the assets will automatically transfer to the surviving owner.
Tell Centrelink
This is really important. You must tell Centrelink with 14 days of receiving the lump sum. If you don't, you could be overpaid, and you will need to repay the money to Centrelink.
In general, a large inheritance is considered to be a sum of money or assets that is significantly larger than the individual's typical annual income. Specifically, for some individuals, a large inheritance may be considered to be $100,000 or more, while for others, it may be several million dollars.