What happens to your CPF, HDB Flat and other forms of wealth when you die

08 Jun 2016 
SOURCE: Big Fat Purse

Singaporeans are pretty rich if you asked me. We have one of the highest property ownership percentage in the world.


This creates a first world problem: do your assets get distributed to your intended beneficiaries when you passed away?


What are the laws in place to see through this and the major implications?


Although this is an important topic, few people seem to pay much attention to it. I am not sure if it is a bad omen to talk about this, or most people just don't think they would pass away any time soon. But accidents can happen and shouldn't we plan for distribution once we have considerable wealth to give away?

Let us first run through a few laws or procedures that I was able to dig out.


CPF Nomination


CPF currently has a nomination scheme where every member can name an unlimited number of nominees. Only savings in the Ordinary, Special, Medisave and Retirement Accounts; and Discounted SingTel (ST) shares, will be distributed to the nominees.


It is important to note that CPF savings are NOT covered by the will.


Another important fact is that your nomination will be REVOKED upon marriage and fall back on intestacy laws. You have to nominate again if you wish to.


The following assets are NOT covered under the CPF Nomination:

  1. Cash and investments held in the CPF Investment Account under the CPF Investment Scheme-Ordinary Account (CPFIS-OA) – distributed according to laws governing the estate
  2. Investments held under the CPF Investment Scheme-Special Account (CPFIS-SA) – distributed according to laws governing the estate
  3. Dependants' Protection Scheme (DPS) claim proceeds – arrangements with Great Eastern Life or NTUC Income
  4. Properties bought with CPF savings – These will be distributed according to the manner of holding. If the property is held as joint tenancy, the deceased's share of the property will pass by operation of law to the remaining surviving owner(s). Otherwise, the deceased's share of the property will form part of the deceased's estate.


CPF is only one form of wealth. What happens to your shares in CDP, cash in bank accounts, fixed deposits, private properties, or even gold bars if you do not have a will?


It will be distributed under the intestacy law.


Intestate Succession Act


It is important to note that the Intestate Succession Act only applies to non-Muslims. Muslims would follow the Faraid or Islamic Inheritance Law.


Below are the distribution principles of the Intesate Sucession Act (The Act is quite difficult to understand and I found singaporelegaladvice.com's simplified table much easier to read):

SpouseChildren, parentsSpouse gets everything
Spouse, childrenSpouse gets half, children gets the other half in equal portions
ChildrenSpouseChildren get everything in equal portions. Grandchildren can claim their parent's share in equal portions if their parent is dead
Spouse, parentsChildrenSpouse gets half, parents get half in equal portions
ParentsSpouse, childrenParents get everything in equal portions
Brothers and sisters (or children of the deceased brother or sister)Spouse, children, parentsBrothers and sisters get equal portions. Their children can claim their share for them in equal portions if they are deceased
GrandparentsSpouse, children, parents, brothers and sisters or children of such brothers and sistersGrandparents take the estate in equal portions
Uncles and auntsSpouse, children, parents, brothers and sisters or children of such brothers and sisters, grandparentsUncles and aunts take the estate in equal portions
NoneEveryoneGovernment takes everything


Education On Wills


The problem with the Intestate Succession Act is that you might not agree with the distribution in terms of the beneficiaries and the percentage of inheritance. This is the reason why you would want to set a will.

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