In Malaysia, once a person passed away, his/her assets will be frozen and can only be distributed according to his nomination (for insurance policies, KWSP and PRS), his will or Distribution Act.
For a person who does not leave behind a will, i.e. intestate, Distribution Act will decide who are entitled and their portion size. Refer to below table for details.
To claim estate under Distribution Act, the family needs to apply for Letter of Administration (LA). To get LA, the family need to go through the below processes. The biggest problem in this process is the 2 sureties that has to guarantee gross estate value for Administration Bond. Meaning should the Administrator run away with deceased's assets, sureties has to come out with their own to pay the family. Basically, nobody wants to be a guarantor.
Another alternative that are more commonly used by general public is to seek Amanah Raya or Harta Pusaka Kecil (under Pajabat Tanah dan Galian). Harta Pusaka Kecil only deals with estate that has at least some immovable properties (house, car, land etc). Amanah Raya can deal with estate with immovable and/or movable properties.
Amanah Raya is a public trustee, thereby requirement of 2 sureties is not needed. Amanah Raya will require some documents and fees when public seeks their service.
Documents needed
The following documents are needed for processing:-
1. Deceased's death cert (original and photocopy)
2. Deceased's birth cert
3. NRIC of deceased's parents, spouse and children
4. Copy of birth cert of deceased's children
5. Copy of death cert deceased's parents (if demised)
6. Copy of marriage cert
7. Photocopy of movable / immovable assets
8. Amanah Raya's forms
Therefore, it is very important to ensure all family member's birth cert, marriage cert and NRIC are readily retrievable. You never know when you will need any of them. Relationship between family members can only be proven with birth cert and marriage cert. So don't lose them.
Make extra copy so that in case of loss, you can still bring the photocopy to JPN to request for replacement. This is especially important for parents or grandparents that are born around independence time. JPN may need to manually search for cc copy in their offices. So, a photocopy will assist their job a great deal.
Fees
1. Deposit of between RM150-RM1000 depending on the type of assets
2. Administraton fee of between 1%-5% depending on type and size of assets
Time
Waiting of 4-12 months depending on the size and type of assets.
Observation
Although Distribution Act provide a structure of dividing assets, it is still best to make a proper will according to your needs. With a will, you decide who gets what and their portion. Example, you may want to allocate more for child / parents that need extra care.
Parents with young children also can decide the guardian and the age the are entitled to inherit the assets. A child age 18 who inherit big assets may suddenly be surrounded with many investment advice (or worse, spending advice).
I still remember a friend's wife who lamented it is very tiring and time-consuming to go to various banks and government offices to make enquiries and submissions. On top of that, she has to take care of her two children. So during will-writing time, I always ask my clients whether they want their spouse to go through the same ordeal.
There are many areas that needs to be considered to ensure the future events are not burdening the family members. Always seek professional help to plan your assets distribution.
