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Remove items from your saved list<\/a> to add more.<\/p>\n AAA<\/p>\n With billions in assets set to pass between generations, our six-part series simplifies the daunting world of inheritance planning. See all stories.<\/a><\/p>\n Many of us will receive an inheritance in our lifetime, and some of us are relying on it. According to Vanguard\u2019s How Australia Retires report, 21 per cent of working-age Australians plan to use an inheritance to contribute to their retirement income.<\/p>\n Yet receiving an inheritance, be it cash or other assets, often catches us off guard. Some of us \u2013 understandably \u2013 avoid thinking about the practical implications of inheriting before the event because doing so would also involve thinking about the death of a loved one.<\/p>\n For others, an inheritance may represent the largest sum of money or most valuable asset they have ever received, bringing with it strong and conflicting emotions, such as anxiety and excitement.<\/p>\n \u201cI would strongly encourage anyone due to receive an inheritance to seek financial advice,\u201d says Suzanne Jones, partner and head of estate planning at Coote Family Lawyers. \u201cEveryone\u2019s circumstances are different, so it is important to seek out information that is relevant to you.\u201d<\/p>\n In the meantime, here are four steps, suggested by Jones and other experts, to help you make sense of inheriting so that you are better prepared when your windfall arrives.<\/p>\n Editor’s pick There are no inheritance or estate taxes in Australia, and cash inheritances do not need to be declared as income. But many inheritances consist of other assets, such as property or shares, which may attract capital gains tax (CGT) if the inheritor sells them.<\/p>\n \u201cThe capital gains tax implications vary depending on your relationship with the deceased and how the asset was used during their life,\u201d Jones says. \u201cFor some, instructing the estate\u2019s executor to sell the asset, pay the tax and transfer the balance in cash may be preferable.\u201d<\/p>\n In other instances, the deceased\u2019s will may instruct the executor to establish a testamentary trust, or give the inheritor the option to establish one.<\/p>\n Testamentary trusts manage assets of the deceased and pay any income derived from them to nominated beneficiaries. The income is at present taxed at the beneficiary\u2019s personal marginal tax rate, but this could change to a 30 per cent minimum tax rate by July next year if the government\u2019s recent budget changes pass into law.<\/p>\n \u2018This is a stressful event, and our brains don\u2019t operate as well when we are under stress, so our decision-making can become impaired.\u2019<\/p>\n Natallia Smith, psychologist and director of TruWealth Advice.2. Be aware of the potential for claims<\/p>\n If a relative or significant person in the deceased\u2019s life believes they have not been properly accounted for in the will, they may be able to make a legal claim for assets, known as a Family Provision Claim. If such a claim is successful, it may reduce the size of your inheritance.<\/p>\n The window for lodging a Family Provision Claim varies from state to state, Jones notes. \u201cIn Victoria, an eligible claimant has six months from the date probate is granted. In NSW, it\u2019s a year from the date of death.\u201d<\/p>\n Usually, an executor will not distribute the contents of an estate until the claim window has elapsed, but there is no requirement to wait. That means you may need to return assets if a successful claim is made after you receive them.<\/p>\n 3. Think of an inheritance as income<\/p>\n Whether you receive an inheritance as assets, tax-free cash or taxable trust income, it\u2019s natural to think of the windfall as something \u201cextra\u201d and ring-fence it from your overall finances.<\/p>\n But this framing can result in unwise decisions, says Natallia Smith, financial adviser, psychologist and director of TruWealth Advice. \u201cIt\u2019s one of the reasons lottery winners often end up with no more money than they had in the first place,\u201d she says.<\/p>\n Instead, absorb an inheritance into your overall financial position, as though you have earned it, and proceed accordingly, Smith says.<\/p>\n \u201cThen you\u2019re much more likely to make decisions that will benefit you in the long run. If you have a home loan, for example, you\u2019d consider paying it off, or perhaps you\u2019d make a voluntary superannuation contribution.\u201d<\/p>\n Receiving an inheritance can reignite grief, Smith says, prompting some inheritors to deal with the inheritance quickly in the hope that the grief will subside.<\/p>\n For others, particularly those who receive large inheritances, internal pressure to allocate the windfall so it\u2019s not \u201cjust sitting there\u201d can quickly build, Smith says.<\/p>\n \u201cIt\u2019s important to recognise that this is a stressful event, and our brains don\u2019t operate as well when we are under stress, so our decision-making can become impaired.\u201d<\/p>\n Smith advises delaying decision-making until any intense emotional responses have subsided. \u201cThat will give you a better chance of really understanding the implications of what you have received before you commit to anything.\u201d<\/p>\n Advice given in this article is general in nature and is not intended to influence readers\u2019 decisions about investing or financial products. They should always seek their own professional advice that takes into account their personal circumstances before making any financial decisions.<\/p>\n Expert tips on how to save, invest and make the most of your money delivered to your inbox every Sunday. Sign up for our Real Money newsletter<\/a>.<\/p>\n This story was created in partnership with Vanguard. The content is independent of any influence by the commercial partner.<\/p>\n Save<\/p>\n You have reached your maximum number of saved items.<\/p>\n Remove items from your saved list<\/a> to add more.<\/p>\n![\"With](\"https:\/\/www.newsbeep.com\/nz\/wp-content\/uploads\/2026\/06\/53e4a2b77ac617749ef3ff5883cdf6e6efe76218.jpeg\")
With more of us passing on our inheritances while we live, an increasing number of Australians are looking beyond the family tree when estate planning.Simon Letch<\/p>\n![\"Your](\"https:\/\/www.newsbeep.com\/nz\/wp-content\/uploads\/2026\/06\/ab131b28efa2c58e4230d7d8cf0e955b5c1086ff.jpeg\")
<\/a>1. Consider the tax implications<\/p>\n![\"Appropriate](\"https:\/\/www.newsbeep.com\/nz\/wp-content\/uploads\/2026\/06\/f51954481bf7024f3447e7aee65c98cc15e7a9a7.jpeg\")
Appropriate planning is needed when it comes to unexpected inheritance windfalls.Dominic Lorrimer4. Don\u2019t rush<\/p>\n
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