From the big picture to the micro aspects, we started with the objectives of Estate Planning and why it’s important to our community, Wills, the different forms of a Lasting Power of Attorney (LPA) and the Advanced Medical Directive (AMD). We’re now onto quite possibly the most exciting topic – personal property and finance.
There are 3 main types of property – immovable property that includes real estate, personal property which is tangible, and personal property that is intangible. I shall attempt a picture with some examples.
Real estate, which includes your apartments, land, houses is generally governed by different rules and boils down to the arrangement, whether it is held in joint tenancy or tenancy in common. Intangible personal property, however, tends to get a little more confusing.
With a bank account held under an individual’s name, what happens when you pass is that the bank will freeze the account. Some banks may not require letters of administration if the amount in the deceased’s account is less than $5,000. Only the “next of kin” or the legal rep can apply for the right to access the money inside. This isn’t very nice for queer couples, especially in the event 1 party really needs the liquidity.
A workaround for this is to have a joint bank account. 2 people may open one following the usual procedures of bringing both ICs to the bank. LGBTQ+ couples are not barred from owning a joint bank account. There are 2 main formats in Singapore – a joint-alternate account and a joint-all account.
In a joint-alternate account, either 1 of the account holders may withdraw money. For a joint-all account, both account holders must agree to withdrawing money.
If 1 or both account holders want out of the joint account, the bank account needs to be closed, or 1 has to transfer their share of the account to the other.
If 1 of the account holders passes on, the bank will automatically give the account balance to the surviving account holder once the account is closed. The surviving account holder needs to go to the bank with the death certificate and other required documents. This does NOT pass through the will and/or intestacy, making this one way you can pass on your money to the intended party.
The nomination of your Central Provident Fund (CPF) savings is crucial to any queer person. CPF does not form part of a person’s estate and cannot be distributed by making a will. It will be distributed according to intestacy laws (default arrangement by Singapore law) which might mean that your partner may not get anything at all. This way, they will be protected from creditor claims on any outstanding debts too.
If you want your partner to benefit from the funds of your CPF, you need to nominate him/her/them as a beneficiary of your CPF savings. You can do this online here. The CPF nomination will cover:
- The CPF monies in your Ordinary, Special, Medisave and Retirement Accounts;
- Any unused CPF Life premiums
However, do note that the following will not be covered under the CPF nomination. They will form part of your estate instead:
- Property bought using CPF
- Payouts from the Dependants’ Protection Scheme (DPS)
- CPF Investment Scheme-Ordinary Account (CPFIS-OA) cash and investments
- CPF Investment Scheme-Special Account (CPFIS-SA) investments
You can choose whether your loved one(s) receive the CPF monies in cash or transferred to their CPF account(s):
- Cash Nomination – Your nominee(s) will receive the CPF savings due to them in cash via cheque or GIRO
- Enhanced Nomination Scheme (ENS) Nomination – They will receive the CPF savings due to them in their CPF accounts
- Special Needs Savings Scheme (SNSS) nomination option allows you to nominate any of your children with special needs to receive your CPF monies on a monthly basis
You may wish to update your CPF nominations along the way by cancelling the old one and submitting a new one.
One of the most recurring questions is whether I can top up my partner’s Medisave account or use mine to pay for their medical treatments. The marriage between 2 same-sex people is not recognised here. Hence, this is not possible. You can’t transfer your CPF monies to another person’s CPF too, unless they are related to you.
Ensuring money goes to people we love
We spend a substantial percentage of our incomes on insurance and with good reason, since it protects ourselves as independent persons and people we love or will have to depend on. In Singapore, the laws and regulations regarding insurance is similar to that applied to a single person. If no nominations are done and no beneficiaries selected, payouts follow the will (You can read more about wills here), and then it goes to the next of kin according to the Intestate Succession Act. This means your payouts may not reach the people you intended for. Policy owners/holders can nominate any persons as beneficiaries. Yes, this means you get nominate your same-sex partner, or your partner(s).
Over the years as a Financial Consultant, I understand that most people have at least heard about nominatingsomething someformsomething. However, there’re other important considerations. By doing up your nomination forms, it ensures that the insurer(s) can efficiently get the money to someone that you care for. There is no time spent on the whole thing going through the probate process. It’s a difference between days and months. For LGBTQ+ folk, only revocable nominations can be done. These can be revoked easily and/or updated with a new one.
Purchasing health plans for family
Singaporeans and PRs are automatically covered by Medishield Life for B2/C wards. To upgrade to cover larger bills, individuals can apply to private insurers for an Integrated Shield Plan, which is partially payable via Medisave. The spouse, child/ward, parent, grandparent’s Medisave can be used to pay for this. Since this is not applicable for LGBTQ+ persons, one can consider cash payments if necessary instead.
Purchasing life, disability and accumulation plans for family
For LGBTQ+ folk, with most private insurers, you will not be able to obtain policies for your partner. They will have to sign up on their own to be both the policyholder and life assured. You can contribute to the premiums.
For accumulation plans, you will not be able to obtain policies for your partner. You may choose to change ownership of the policy to your biological or legally adopted child by using Absolute Assignment. However, this is not for everyone. Do speak to a professional first.
Corporate and general insurance for family
With some MNCs, there may be corporate plans that cover the dependents of their employees. Each insurer and contract will have their own policies with various definitions of a family unit. If you are comfortable, do approach your company’s HR to check on this because some require an opt-in. This applies to travel insurance as well, with different insurers having different definitions of dependents.
Queer couples will not be able to obtain tax deductions, which are contingent on the couple being legally married. It is not possible to file for joint taxes as a couple too. Some of the tax reliefs include:
Spouse Relief/Handicapped Spouse Relief
Nope, LGBTQ+ couples do not qualify for this even if you married overseas.
Foreign Domestic Worker Levy Relief
To qualify for this, a woman would have to be in one of the following scenarios. 1. Married and lived with a husband, 2. Married and the husband was not a tax resident in Singapore or 3. Separated, divorced of widowed and had children who lived with you and on whom she could claim child reliefs. If she cannot satisfy any of these, she will likely not be able to qualify to obtain tax relief for employing a domestic maid, even though she is legally married overseas. Men are not eligible.
Parenthood Tax Rebate
In order to apply for this, you will need to be married, divorced or widowed in the relevant year and a tax resident of Singapore. The applicant needs to be the biological parent or have adopted the child.
Qualifying Child Relief / Handicapped Child Relief
You can apply for this if you are the biological parent, the child is a step child, or legally adopted. The child must be below 16 or studying full-time.
Singapore is not LGBTQ+ friendly when it comes to inheritance and matrimonial laws. Despite that and because of it, it’s important we educate ourselves on how to protect ourselves and people we care about while we continue our work. As mindsets shift, with immense effort and support from our community and allies, I believe this little dot can do big things.
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About the Author
Wan Yi is in her 5th year of providing holistic financial planning services, which includes insurance, investments, family and retirement planning, business and estate planning. To do this, she partners with law firms, general insurance firms as well as investment platforms to ensure top notch service.
Her aim is to equip people with the clarity and confidence to execute decisions. There is a lot of noise, but money does not have to be complicated. Wherever you’re at, let’s make a plan and adapt along the way. You can reach out to her through Prident, LinkedIn or Facebook.
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