A Will sets out how you wish to provide for your family, and is a very important element of estate planning. It will:
- Ensure that you decide how the wealth you have accumulated over your lifetime is passed on
- Give you the opportunity to protect assets for the benefit of future family generations
- Give you the chance to minimise any Inheritance Tax liabilities
- Ensure that you do not die intestate if properly drafted and executed
Important Points to Consider when Drafting a Will
Your Will is without doubt one of the most important documents that you will ever draw up. The following aspects of it need very careful consideration:
- What is your estate likely to comprise of – ie, what do you own and what liabilities do you have?
- Who are your beneficiaries and what do you wish to leave them?
The precise wording in your Will gift clauses combined with an understanding of the underlying statutory provisions is essential if you wish to prevent gifts failing or going to unintended parties.
- Who should you appoint as executors and trustees?
There are 3 main categories to choose from:
- individuals (such as family and friends)
- professionals (such as Trust & Estate Practitioners, Accountants and Solicitors)
- trust corporations (large institutions such as banks)
Points you may wish to consider when choosing your executors are:
- capability and suitability (do they have the requisite knowledge or motivation to acquire it?)
- availability (are they likely to have the time and/or good health to carry out the work)
- the possibility of conflict or dispute between executors (family members are the natural but not always the best choice, especially given that they will be going through a very stressful time and disagreements over the Will can often be the cause of family conflict)
- cost (a professional executor will charge for their services, but should have the required knowledge and administer the estate objectively)
- the size and complexity of the estate (a very simple estate consisting (say) of cash/bank balances and less than £30k may not need a professional advisor, most others do)
- Do you have dispositive powers over other property?
eg, has someone given you the power to direct where their property goes after your own death?
- Might any property that you don't actually own nevertheless be taxable as part of your estate - eg, an interest in a trust/settlement, or an asset you gave away during lifetime but have continued to derive benefit from?
If so, is there anything that can be done to change the tax situation?
If not have you considered which beneficiaries bear the impact of the extra tax payable?
- Do you need to change the form of ownership of any property to ensure that your Will takes effect as planned? For example, if you hold property on a 'joint tenancy' it passes by survivorship to the surviving tenant(s) and cannot be directed elsewhere unless you sever the tenancy to become 'tenants in common'.
- What are your funeral directions?
- Can your Inheritance Tax liabilities be reduced?
- Can you use a trust to protect assets for future generations?
- Could there be claims on your estate from Family or 'dependants' who you don't wish to benefit?
- Is it possible to reduce the risk of Care Home Fees taking all your hard earned capital?
By understanding your intentions and personal circumstances, we will ensure your property is passed to those you wish to inherit and in a tax efficient manner.
- Even if you have made a Will it is important that it is reviewed regularly so that it reflects changes in your personal and financial circumstances and changes in the law. It is often surprising how much can change within only a few years.
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