Have you ever thought about what happens to your assets when you’re no longer around?
It’s not the most cheerful topic, but it’s an important one. If you don’t have a plan in place, the law will decide for you. In Indonesia, this means your estate could be distributed through intestacy rules, which might not align with your wishes. Let’s talk about how you and I can avoid this by executing a last will.
What Happens Without a Will?
If you pass away without a will, your estate will be distributed according to Indonesia’s intestacy laws. These laws are primarily governed by the Civil Code (Kitab Undang-Undang Hukum Perdata, or KUHPerdata), Islamic Compilation Law (Kompilasi Hukum Islam, or KHI), and the 1974 Marriage Law (Undang-Undang Nomor 1 Tahun 1974 tentang Perkawinan). The applicable law depends on your religion and marital status.
For instance, if you’re a Muslim, the Islamic Compilation Law will apply. This law divides inheritance based on Islamic principles, typically allocating two-thirds of the estate to male heirs and one-third to female heirs. If you’re not a Muslim, the Civil Code steps in, which has its own set of rules.
Either way, these laws might not reflect what you want.
Why Should You Make a Will?
A will gives you control.
It lets you decide who gets what, ensuring your loved ones are taken care of in the way you see fit. Without one, your estate could end up in the hands of distant relatives or even the state if no heirs are found. That’s not ideal, right?
A will also helps avoid disputes among heirs. Let’s face it! Money and property can bring out the worst in people. By clearly stating your wishes, you can minimize the risk of family conflicts. Plus, a will can be a tool for fairness. For example, if one child has been your primary caregiver, you might want to leave them a larger share. A will allows you to do that.
Legal Grounds for a Will in Indonesia
Now that we know why a will is essential, let’s dive into the legal framework. In Indonesia, the rules for making a will are outlined in the Civil Code and other laws. Here’s what you need to know:
Who Can Make a Will?
According to the Civil Code, anyone aged 18 or older and of sound mind can make a will. If you’re married, the 1974 Marriage Law also comes into play. It states that assets acquired during marriage are considered joint property unless otherwise agreed upon in a prenuptial agreement. This means you can only will away your share of the joint property.
How to Make a Will?
A will must be in writing and signed by the testator. That’s you!. It can be handwritten, typed, or even oral in certain circumstances, but the safest option is to have it notarized. A notarized will is harder to contest and ensures your wishes are legally binding. Wijaya & Co can help you with this.
What Can You Include in a Will?
You can include anything from real estate and bank accounts to personal belongings. The 2006 Administration of Population Law (Undang-Undang Nomor 23 Tahun 2006 tentang Administrasi Kependudukan) requires you to list all your assets and heirs clearly.
Limitations on Freedom of Testation
While you have the freedom to distribute your assets as you see fit, there are some restrictions. For instance, the Civil Code and Islamic Compilation Law require you to reserve a portion of your estate for your legal heirs. This is known as the “legitime portie” in the Civil Code and “faraidh” in Islamic law. You can’t completely disinherit your children or spouse unless there are extraordinary circumstances.
Special Considerations for Muslims
If you’re a Muslim, your will must comply with Islamic inheritance laws. The Islamic Compilation Law allows you to will away up to one-third of your estate to non-heirs. The remaining two-thirds must be distributed according to Islamic principles. This means you can’t leave everything to one person, but you do have some flexibility.
It’s also worth noting that Islamic law recognizes the concept of “hibah,” or gifts given during your lifetime. If you want to ensure someone gets a specific asset, you can gift it to them while you’re still alive. This can be a useful workaround if you’re concerned about the limitations of a will.
What Happens After You Make a Will?
Once your will is finalized, it’s crucial to keep it safe. You can store it at home, or even with a trusted family member. Just make sure someone knows where to find it. After your passing, the executor of your will, a person you appoint, will carry out your wishes. If your will is contested, the court will step in to resolve the dispute.
The 2006 Administration of Population Law also requires the executor to report your death to the local civil registry office. This ensures your will is recognized and your estate is distributed according to your wishes.
Common Mistakes to Avoid
Making a will isn’t complicated, but there are some pitfalls to watch out for:
- Not Updating Your Will. Life changes. Marriages, divorces, births, and deaths can all impact your estate. Make sure to update your will regularly to reflect these changes.
- Ignoring Legal Heirs. As mentioned earlier, you can’t completely disinherit your legal heirs. Ignoring this rule can lead to your will being contested and possibly invalidated.
- Not Consulting a Lawyer. While you can draft a will on your own, consulting a lawyer like Wijaya & Co, ensures it complies with all legal requirements. A lawyer can also help you navigate complex situations, like blended families or international assets.
- Failing to Communicate. Surprises are great for birthdays, but not for wills. Talk to your family about your plans to avoid misunderstandings later.
Final Thoughts
Executing a last will in Indonesia isn’t just about dividing your assets. It’s about taking care of the people you love. By making a will, you can ensure your wishes are respected and your family is spared unnecessary stress.
So, what are you waiting for? Let’s take control of our legacies and make sure our hard-earned assets go to the right people. After all, it’s better to plan now than to leave it to chance later.
My name is Asep Wijaya. Thank you for reading my posts!