questions-and-answersRecently I received some questions from one of my readers of the blog. He asked if a person dies without a Will, how will the investments under joint account be distributed? I think this might be an interesting question to many.

Question 1:

Unit Trust bought under Cash with a local bank and subsequently the sibling of the deceased was added as a joint owner and the decease still remained as Main applicant.

In this example, if unit trust was bought under joint name, the account will be handled according to the terms and conditions of the account. Generally, the law of survivorship applies. That means the surviving party will take over the investments.

However, if the joint account holder is a minor (below age 21), things can become complicated as the minor cannot give further instruction to the bank or unit trust platform.

Nevertheless, you should not assume it is based on survivorship, and it is important to go through the terms and conditions of that particular account.

Question 2:

CPF board close the investment account under the agent bank, within these period of time before the grant of probate, the bank should not release any cash holding investment Unit trust fund to the other joint account party as the fund was under Subsidiary Singapore Tax Certificate (Designated Unit Trust Pursant to Section 35(12) of the Singapore Income Tax Act)

First of all, if a person passes away without a will, there is no grant of probate, it should be called “letter of administration”. Secondly, CPF Investment account cannot be held under joint name. So I think you may have some wrong information from other sources.

By and large, unlike CPF account, the distribution of CPFIS investments is not covered under CPF nomination.  When a member passes away, his investments under the CPF Investment Scheme (CPFIS) and any cash held in his Investment Account with his agent bank will form part of his estate.  The estate administrator/executor may claim these directly from the agent bank for distribution to the beneficiaries of the deceased’s estate. You can refer to my early article “What happens to investments under the CPF Investment Scheme (CPFIS) when a member passes away” for more information.

Leave your comments here if you have similar questions

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Ivan Guan is the author of the popular book "FIRE Your Retirement". He is an independent financial adviser with more than a decade of knowledge and experience in providing financial advisory services to both individuals and businesses. He specializes in investment planning and portfolio management for early retirement. His blog provides practical financial tips, strategies and resources to help people achieve financial freedom. Follow his Telegram Channel to join the FIRE community.
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  • I understand that when a CPF member passes away, his investments under the CPF Investment Scheme (CPFIS) will form part of his estate and the estate executor will claim these directly from the agent bank. If there’s only one executor who is also the sole beneficiary as stated in the deceased’s will, can the executor ask for transfer of the investments rather than distribution so that the investments don’t have to be sold at a loss / when market timing is not right ?

    • Hi, Chong

      Once the investment becomes estate of the deceases, it should only be distributed upon letter of probate is granted. you can check with the agent bank for the procedure.

  • what happen to our shares at cdp when we passed on.
    can it be transfered to our spouse or we have to liquidate even at a loss and what are the charges involved.
    pls advise

  • Deceased invest 6 UT product under sole applicant account with the Bank on 20×7 and 1 UT under joint applicant account with the bank on 20×5. Under the sole applicant products there are 2 UT investment was invested the same product that the deceased used the CPF invested on CPFIS with the Bank.

    *** UT product invest in Cash
    (1) Unit Trust G ($100,000) – [1111/1]
    (2) Unit Trust F1 ($20,000) -[1111/3]
    (3) Unit Trust F2 ($30,000) – [1111/3]

    *** Unit Trust invest in CPFIS
    (1) Unit Trust F1 ($20,000) – [1111/1]
    (2) Unit Trust F2 ($15,000) – [1111/1]

    *** Joint Account Unit Trust
    (1) Unit Trust B ($50,000) – [1111/55]

    Under the Joint account UT investment was redeemed on 20×8 subsequently there wasn’t any UT investment was invested again under the Joint Account.

    As you can see the CPFIS Unit Trust F1, F2 & Cash investment G under the bank investment account number was the same [1111/1] since year 20×7 only until year 2×11 deceased decided to add in additional account holder into the investment account [1111/1] & [1111/3] as a joint applicant but the the main applicant will still be the trust of the account of the minor joint applicant. Under the form which the deceased fill in doesn’t indicated name of the product at all but only the investment account number [1111/1].

    The redemption was make after the date the deceased was died two week later. During the process of the letter of administration the legal representative provide the bank document to the law firm for clarification and consolidate the deceased assets for estate duty purpose. When the bank account department replied the law firm for the account which deceased held with the bank at the date deceased died was indicated that the all account was nil outstanding beside only the CPFIS was available only. Bank was notify by CPF board that the CPFIS account will be closing by the bank due to the person had pass away two days after the deceased died.

    Eventually during these period the legal representative became as a administrator went to the bank for clarification and this problem was been dragging about 2yrs for the Cash Holding Unit Trust Product G, F1 & F2 which the Administrator have no ideal where was the money begin withdraw. The bank reply mention that the joint applicant had redeemed the product because it was under a joint investment account, in the very first place the legal representative had no ideal when the products was becoming an joint applicant. But when the administrator how come the letter which the bank replied to the lawyer when it was in the process to declare the assets for estate duty purpose was indicated nil outstanding and until now the staff explained that it was an error by the system.

    All the product which transfer was still remaining the same which in the first place it was invest.

    Question 1
    As the product G have the same investment account as the CPFIS product F1 & F2, is it allow to add on additional name into the investment account number [1111/1]?

    Question 2
    Bank replied that it was error after two years later only when the legal representative keep on visited the main branch for clarification. Are the mistake allow to be happen, how would such a error can be happen when the replied was nil outstanding during the process of the letter of administration for estate duty purpose.

    Question 3
    the bank explanation was it was added additional name in to the account [1111/1] than in the later part when the bank realized there was an exiting joint account [1111/55] eventually it was than transfer to this joint account number by the bank itself. Firstly the deceased fill in the form didn’t indicated any of the name of the product at all. How does it able to transfer the product to the joint account when the investment account was also involve in CPFIS.

    Question 4
    Shouldn’t it be indicated the name of the product rather than investment account on the fill which it was filled in? In the case when it was transfer to the joint applicant investment account there must be a transfer form which the deceased and the joint applicant shout sign isn’t it.

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