INDEX planning for later life
Where there’s A WILL...
A Will is possibly one of the most important legal documents that anyone makes during their lifetime, for the simple reason that it allows you to choose how you want your assets to be dealt with when you die. It allows you to specify who you want to deal with the administration of your estate (your executors) and who you want to benefit, whether friends, family or charity. And for those keen to mitigate Inheritance Tax, it can be a useful instrument. The overriding benefit, however, is perhaps the peace of mind that comes from knowing your affairs are in order, which ultimately minimises the distress caused to those around you at what can be a difficult time.
WHAT HAPPENS IF YOU DIE WITHOUT HAVING A WILL? Not having a Will means your estate will pass according to the rules of intestacy, and those whom you wish to benefit might not do so. For example, if you die without a Will, depending on your
circumstances, not all of your estate will pass to your spouse. The intestacy rules also
specify who deals with the administration of your estate following your death, which may mean that the job is given to someone that you feel is unsuitable for the task. If you are married with children, your surviving spouse gets all of your personal possessions, any assets owned as joint tenants (for example, jointly-held investments or bank
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accounts) and a lump sum of £250,000.
Half of everything else passes to your children at the age of 18 and the other half is placed in a trust that gives the survivor of you the right to receive income generated from the trust, with the capital eventually passing to your children when the survivor of you subsequently dies. This can leave the survivor in a vulnerable position. It may lead to an immediate Inheritance Tax charge and may also lead to children receiving money when they are not necessarily mature enough for it. Without children, the
survivor receives a lump sum of £450,000 and half of everything else outright (instead of being placed in a trust). The other half passes to relatives in a set order of priority, such as parents or siblings.
If you’re unmarried and have
a partner, he or she only receives assets that are owned by both of you as joint tenants, with everything else passing to your relatives in the set order of priority. This can potentially leave your partner with absolutely nothing.
WHY USE A SOLICITOR? While it is possible to prepare a Will yourself or instruct an unregulated Will-writer to prepare one for you, solicitors are legally trained, professionally qualified and bound by a stringent code of professional conduct rules, making them best placed to prepare what is a complex legal document. Solicitors are also trained to give advice on related aspects, such as trust law, property law
and tax law, all of which may have a bearing on how your Will should be drawn up. Solicitors are covered by compulsory professional idemnity insurance, meaning that if anything does go wrong and they cause a loss to their client, they are adequately insured and the client is protected. The BBC’s Panorama
programme recently highlighted some of the problems with unregulated Will writers, including cases of clients being over charged, misled and in some cases defrauded. Unlike
Legal expert Chris Eriksson-Lee explains why making a Will is, quite simply, essential
you may not necessarily have otherwise thought of.
UPDATING YOUR WILL Reviewing your Will every few years with the help of a solicitor is always a good idea, as the law or your own personal circumstances may have changed. It is important to bear in mind that certain events will automatically change your Will. For example: 1 Marrying after making a
Will renders it invalid, unless there is a declaration that it was made in contemplation of the
solicitors, Will writers do not have to be legally trained, qualified or insured and there is no mechanism for bringing complaints against them. If, on the other hand, you create a Will yourself, there is no way of guaranteeing that the document is valid or effective. Professional advice and help from a Solicitor in drawing up your Will is therefore always recommended. It also enables you to discuss ancillary matters, such as Inheritance Tax, and properly consider aspects that
intended marriage. 2 Divorcing after making a
Will does not invalidate it, but revokes any gift to your ex- spouse or any appointment of them as an executor. A Will can be reviewed at any time and changed by either making a new Will or, alternatively, by making a codicil if only a minor amendment is needed.
i
The author is a solicitor at Warners Solicitors, Tonbridge and Sevenoaks, tel 01732 378972,
www.warners-solicitors.co.uk
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The INDEX magazine september 2011
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