The Importance of Having a Will in Malaysia

  • Inheritance
The Importance of Having a Will in Malaysia

The Malaysian Wills Act 1959 defines a will as a declaration intended to have legal effect of the intentions of the testator concerning their property or other matters, which they desire to be carried into effect after their death. The Act only applies to the States of Peninsular Malaysia.

The Wills Act does not apply to the wills of persons of the Islamic religion. Muslim inheritance is governed by Syariah law. Muslims need to draw up a “wasiat” (similar to a will) and appoint a “wasi” (similar to an executor). Whilst a “wasiat” and a will serve the same purpose; they are governed by entirely different sets of laws.

In short, the purpose of will writing is to express your wishes on how your estate must be distributed after your death. You may also express other wishes, for example, who must take care of your children or the family business.

To ensure that your will is executed according to your wishes, you will appoint an executor of your choice.

Of course, for your will to have effect, it must be valid.

For a will to be valid, it must comply with the following:

  • The person making the will (the testator) must be 18 years or older. (In Sabah, 21 years is the age of majority)
  • The will must be in writing and signed.
  • The testator must sign the will in the presence of two witnesses. A beneficiary or the spouse of a beneficiary may not be a witness to the signing of the will.
  • The testator must be of sound mind.

What happens if you die without a will?

If you die without a valid will you die “intestate”. Intestate succession takes time and costs money.

In Malaysia, The Distribution Act 1958 will determine who gets what if you are a non-Muslim and die without a will. (In the state of Sabah, the Intestate Succession Ordinance 1960 applies.) You have no say or control over who gets what.

Under the Distribution Act, your property will be distributed among your family members according to a set formula, depending on who you leave behind.

  • If you die with a spouse, descendants (called issue), and parents, your issue will get half of your estate, and the other half will be split equally between your spouse and your parents.
  • If you die without parents, but with a spouse and issue, your spouse will receive one-third of your estate and your issue two-thirds.
  • If you leave no issue, but a spouse and parents, your estate will be divided half-half.
  • If you leave no spouse, but parents and issue, your issue will receive two-thirds and your parents one-third.
  • If you leave only a spouse, or only issue, or only parents, they will receive the whole estate.
  • If you die without a spouse, parents, or issue, your estate will go to siblings, grandparents, or uncles and aunts in equal shares. If you leave no one behind, your entire estate will go to the government.

Intestate succession might not be the same as your wishes or your families’ needs. Writing a will in Malaysia is critical to ensure that your wishes for your loved ones and your property are executed after your death.

It is important to remember that your will becomes invalid or void if you get married or re-married. You will need to prepare a new will unless you specifically stated that your will is “in contemplation of marriage”.

The same applies if you convert to the Islamic faith because the distribution of your assets will then be done in accordance with the Islamic law of inheritance.

The benefits of having a will

Having a will that is properly drafted, dated, signed, and witnessed has many benefits.

The testator decides who gets what

Intestate rules might work against your wishes. Your parents might not need to inherit your assets after you pass on; you might feel that your spouse or children need it more.

If you are unmarried, you might want your partner to inherit some of your assets. Likewise, children out of wedlock won’t receive anything if you die intestate.

You might want to bequeath some of your assets to old friends, or carers or charities. If you die intestate, your assets might end up with distant or estranged relatives.

By writing a will, you can ensure that these people or institutions receive assets according to your wishes after your death. A will sets out your intentions. You are free to choose your beneficiaries and determine how your assets must be distributed. You decide, not the law.

The testator is free to appoint his or her executor of choice

You would choose an executor who you trust and who will respect your wishes and execute your estate with integrity. If you die intestate, any person with an interest in your estate may apply to become the administrator. All the beneficiaries must agree on the applicant; express consent is required. Needless to say, this can lead to disputes and delays in the execution of your estate.

Once a person is agreed upon, the beneficiaries would then need to apply for a Letter of Administration. The Probate and Administration Act 1959 grants the court the discretion to appoint an administrator. After appointing an administrator, the process of administering an intestate estate can take 2-5 years.

An executor has the right to carry on with the testator’s affairs, subject to certain conditions. An administrator has no such rights.

With a valid will, the distribution of assets is much faster and less costly

It still takes some time for the executor to obtain permission from the court to execute the will, but once the Grant of Probate is obtained the executor can get on with the distribution according to the testator’s wishes. Getting a Grant of Probate is much faster than applying for a Letter of Administration. Also, a lot of time is needed to locate, assess and value all the deceased’s assets and liabilities. Your family will need the services of lawyers, accountants, tax consultants and other professionals. These services cost money.

A will speeds up the distribution process considerably and is less costly.

The testator determines who will look after minor children

By writing a will in Malaysia, you may appoint who you want to be the guardian of any children under the age of 18 years. If both parents pass away, and there is no will, there is no certainty who will be responsible for looking after your children. The court-appointed guardian may not be your first choice to look after your children. If you have children, you want peace of mind that they will be looked after in the event of your death. You do not want them to be moved around from person to person until the court appoints a guardian.

An estate without instructions is open to being contested

The famous artist, Pablo Picasso, died without a will. It took six years to settle this estate, and it cost $30 million in fees! Your estate might not be worth $250 million, but a quick and easy distribution will have obvious benefits for your beneficiaries, regardless of the value of your estate.

A clear and valid will means less chance of your will being contested. And less chance of claims against your estate. Resolving a claim against your estate or defending a contested will can take many months and may cost significantly more than writing and executing a valid will.

Do I need a will if I’m an expat?

Malaysia recognises the validity of international wills that relate to assets in other countries. However, if you own immovable property in Malaysia, or would be considered a permanent resident at the time of your passing, it is recommended that you write a will in Malaysia.

Not having a will in Malaysia can tie up your Malaysian assets for a long time. You will first need to obtain a Grant of Probate in the country where the asset is based before the Malaysian courts will even begin to process probate in Malaysia.

Not having a will in either country can make things extremely complicated for your loved ones and cause delays for many months or years.

Do you need a lawyer to prepare your will?

It is not a legal requirement that a lawyer must prepare your will. The absence of a valid will can, however, have significant consequences on the distribution of your estate and your loved ones.

A lawyer who is familiar with Malaysia will writing laws can explain the legal formalities that your will has to comply with. You can discuss your wishes and the implications of your wishes on your families’ finances with a lawyer. A lawyer with knowledge of the law of succession in Malaysia can advise on the tax and other financial implications.

It is always good to get a lawyer’s opinion, even if you write your own will. You want peace of mind that your will is valid and that your wishes can be executed after your passing on.