My mother left an Israeli will and had Australian superannuation. Does the will cover her super?

Executors in Melbourne and Sydney routinely list the super balance in the estate schedule alongside the Israeli apartment, and the two are governed by entirely different machinery. The apartment answers to an Israeli order. The super answers to a trust deed and, if there is one, to a form your mother signed years ago and may have forgotten about. Where those two documents disagree, the form usually wins.

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Detailed Answer

Australian superannuation is held on trust and is not owned by the member at death, so it does not pass under any will, Israeli or Australian. The trustee decides who receives it, choosing among the deceased's dependants and the legal personal representative, unless a valid binding death benefit nomination under the Superannuation Industry (Supervision) Act 1993 and its regulations directs the outcome. A binding nomination lapses after three years unless the fund offers a non-lapsing form, which is why nominations made before an aliyah, a remarriage or a divorce are the most common source of a result nobody intended. Tax then depends on who receives it rather than on what the will says. A death benefits dependant, meaning a spouse, a child under 18, a financial dependant or someone in an interdependency relationship, takes a lump sum tax-free. A non-dependant, typically an adult child, pays 15% on the taxed element of the taxable component and 30% on any untaxed element, and the fund withholds at source. A beneficiary who is a foreign resident for Australian tax purposes is generally outside the Medicare levy, so the effective figures are the bare 15% and 30%. On a AUD 400,000 benefit with a AUD 300,000 taxed element paid to an adult child, that is AUD 45,000 withheld, roughly NIS 108,000.

The Israeli assets need their own order, and starting that process early is worth more than any other piece of advice here. Under Section 66 of the Succession Law 1965 the Inheritance Registrar (Rasham HaYerushot) issues both succession orders and will execution orders, and Section 138 reserves succession to immovable property in Israel to Israeli law whatever the deceased's domicile, so an Australian grant does not transfer a Netanya flat. Where the Israeli will covers only Israeli assets and an Australian will covers the rest, both need to be produced and neither revokes the other by accident, which is a drafting question worth checking before either is submitted. From Australia the file runs on apostilled documents: a death certificate apostilled by the Department of Foreign Affairs and Trade, consents or waivers from the other heirs signed before an Israeli consul or a local notary with an apostille, and a Hebrew notarial translation of anything not already in Hebrew or English.

Two Israeli points catch Australian executors. Israel has charged no inheritance or estate tax since estate duty was repealed in 1981, so a receipt of inherited money is not taxable in Israel and there is nothing Israeli against which the Australian 15% could be credited; the Australia–Israel double tax convention, in force since December 2019, does not change that, because Israel is not taxing the receipt. And if the trustee's decision goes against you, the complaint runs on short Australian clocks rather than Israeli ones, with 28 days to object to the trustee after its notice and a further 28 days to take the matter to the Australian Financial Complaints Authority. Transferring the Israeli money afterwards is a separate exercise, set out in our answer on receiving an Israeli inheritance abroad without an Israeli bank account.

In Practice: Section 66 of the Succession Law 1965 gives the Inheritance Registrar (Rasham HaYerushot) power to issue the will execution order for the Israeli will, at NIS 597 on paper or NIS 507 online plus a NIS 66 publication fee, with an uncontested file taking three to six months, and Section 138 keeps Israeli immovable property under Israeli law regardless of domicile. The superannuation sits outside all of it: the fund withholds 15% on the taxed element paid to a non-dependant and 30% on any untaxed element, and a beneficiary who objects has 28 days to write to the trustee and a further 28 days to lodge with the Australian Financial Complaints Authority.

When to Consult a Lawyer

• The nomination names someone the will does not, or names a person who has since died or divorced the deceased. The trustee applies the nomination if it is valid, and challenging validity is a superannuation complaint rather than a probate dispute.
• Your mother made aliyah at some point. Residency changes affect the Australian tax characterisation of the benefit and can also affect which will the Israeli Registrar treats as operative.
• There are two wills, one Israeli and one Australian. Whether the later revoked the earlier is decided on the drafting, and submitting the wrong one first can cost months and require an amendment application.

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Speak With an Israeli Attorney

We obtain the Israeli will execution order, check that the Israeli and Australian wills do not cancel each other, and prepare the apostilled document set the Registrar accepts from Australia.

Contact us for a confidential initial consultation.