A proper Islamic estate plan is a religious obligation and must be followed strictly to ensure that heirs are protected against potential abuse. There are several tools to be used in an Islamic estate plan, including an Islamic will and a Trust. However, a proper Islamic estate plan must adhere to the principles of Islamic inheritance law and legal laws. If an estate plan fails to follow these laws, the testator’s wishes will not be fulfilled.
An Islamic Will can protect minor beneficiaries under guardianship and heirs from possible mismanagement of funds. The testator appoints executors and guardians, and heirs are expected to follow the instructions in the Will. In addition, an Islamic Will reduces the time needed for probate and secures the rights of beneficiaries if it is drafted properly. Wassiyyah offers many types of Will that you can check out.
The advance estate plan includes creating an Individual or Joint Trust. The Trust takes effect immediately upon the execution of the Trust Deed. The advantage of creating a Trust is; it does not pass through probate and will remain private. In addition, the Trust does not freeze or infringe upon third parties.
A proper Islamic estate plan must take into consideration the testator's religious beliefs, as well as his or her surviving relatives. It is important to determine which assets and properties are currently liquid. This is particularly important for Muslim clients who have large assets. Moreover, all good estate plans should be periodically reviewed.
The Holy Quran explains in chapter 4 that Inheritance distribution needs to align with your estate planning. The first inheritance division is made to Al-Faraid (i.e., Fixed sharers) and Residuary. The if they do not survive, then estates pass to Distant kindred, subject to Madhab’s differences in opinions. The executor will follow instructions outlined in the Islamic Will about estate distributions.
Aside from being a religious obligation, estate planning is also beneficial for the heirs' afterlife. It ensures that the testator's wealth is distributed according to his or her beliefs and helps the testator cover the benefits of both lifetimes. It also enables the testator to comply with the country’s probate laws. It is important for all Muslims to have a plan that is in line with their religious beliefs and the laws of their home country.
A comprehensive estate plan should include a Trust, pour-over wills, funeral and burial decisions, and a list of assets. It should also include a joint power of attorney. There are some implications you need to know about the jointly owned assets. An estate planning expert can provide insight into your estate planning goal so that the plan will be effective.