Making probate easier for those you leave behind

It’s easy to put off doing the things in life that feel overwhelming. Thinking ahead to your family’s future without you, for example. But what if we told you that this can be a positive exercise?

Good planning during your lifetime means loved ones stand to benefit later from the financial and other arrangements you put in place. Doing this gives real peace of mind. You can relax, knowing you’ve provided for the right people and that the practical steps after you have passed away will be easier to work through. The emotional toll on your family won’t be added to by loose ends, missing information, confusion.

When a person passes away, their estate (in most cases) must go through the process of probate. Probate is the key to unlocking assets. It confirms who has authority to ‘administer the estate’ and deal with the person’s personal, financial and other affairs. Until probate is issued, the estate assets cannot be sold or distributed. (Where a person dies without a Will, the process is similar but the intestacy rules apply.)

The idea of going through the finer details of everything a loved one owned, owed, and intended for others can be daunting. As probate specialists, we help families deal with the legal process and practicalities. And we help people prepare so that, when the time comes for their estate to be dealt with, probate is an easier experience for those they care about.

How can you make probate simpler?

Make a Will

A Will sets out your wishes and allows you to control how your estate will be dealt with. It names the ‘executors’ – the people who will administer your estate. It can also set out funeral wishes, beneficiaries, and identify guardians for minor children. These types of details give much-needed certainty and guidance to those left behind.

A Will is not a once-in-a-lifetime document. You should review your Will any time your personal or financial circumstances change. And it’s a good idea to let your executor and/or family know where the Will is stored, as the original document will be needed during the probate process. Without it, the process of applying for probate becomes more complex.

Plan for inheritance tax

Inheritance tax (IHT) must be calculated and paid before the executors can apply for probate. With good planning, you’ll be able to minimise the amount payable so that there’s more value to be distributed from the estate. If you think your estate will be liable to IHT, a financial advisor and a solicitor could help you mitigate the liability.

Get your paperwork in order

Imagine being the person responsible for having to trace another person’s assets. Unfamiliar paperwork and online accounts can make this complicated and time-consuming. So help them out by keeping a record of your assets, together with any usernames and passwords that might be needed by your family. Store these in a safe place.

With the right help, future planning can be straightforward. And it’s always worth the effort. As trusted experts with years of experience in helping people and families before, during and after probate, we see the difference forward-thinking makes. That’s why we work very closely with people to understand their circumstances, share their burden, and support them with the very best legal and practical guidance.

For tailored advice on future planning and probate contact Thomas Mansfield’s Wills & Probate team on 0808 256 2917 or email [email protected].

The Queen of Soul and the handwritten Will

Aretha Franklin has often been cited as one of the most high-profile celebrities not to have made a Will. But nine months after she passed away, there was a significant discovery.

Two Wills were uncovered. The first, from 2010, was a handwritten note found along with other documents in a locked desk drawer in her home. The second – also handwritten but dated 2014 – was in a spiral notebook wedged under the cushions of her sofa.

Was the 2014 note a valid Will that superseded the first? That was the question for the US court that heard the case which embroiled Franklin’s family. And the outcome would be significant because of the difference in the inheritance provisions made in 2010 and in 2014. It is said to have taken jurors less than an hour to decide that the later Will was valid. Among the reported facts are:

  • The Will included the words: “…being of sound mind, I write my will and testimony”.
  • One son said Franklin often handled business on the sofa. “It doesn’t strike me as odd”, he said, that a Will was found there.

Some may be surprised that a document, seemingly so informal, could hold the same legal status as a lengthy, typed document drafted meticulously in a lawyer’s office. Does it mean that formalities don’t really matter? Or that there’s no need to involve a lawyer at all?

It’s certainly possible to prepare your own Will, but this can be a risk. There are two main reasons. The first is that the law in England and Wales is very specific about the things that are necessary for a Will to be valid. These are that the Will must be in writing and that the person making it must:

  • be at least 18 (there is a military personnel exception)
  • have the intention to make the Will, voluntarily and without pressure from anyone else
  • have ‘capacity’ – a sufficient degree of understanding
  • sign the Will in the presence of two witnesses, who are not beneficiaries
  • be present while the two witnesses sign the Will

If one or more of these requirements is missing, the Will is likely to fail. An invalid Will means that efforts to control the way in which assets will be distributed post-death will have been in vain; the laws of intestacy take over, dictating who the beneficiaries should be and the order in which they should inherit. This can lead to outcomes that the deceased may not have wanted, and family disagreements which needn’t have come about.

As Wills and inheritance specialists, we help clients benefit from the certainty of having a valid Will in place. Part of this involves checking two of the less straightforward requirements of validity: the voluntary Will, and ‘capacity’ (or ‘sound mind’, as it used to be known). We may suspect that our client is being pressured to write their Will in a particular way. Asking the right questions and ensuring they know that undue influence could render their Will invalid means clients are in the best place to make the right decisions. Equally, it’s sometimes apparent to us that a client’s ability to understand what it means to make a Will and its effects is compromised. In some situations where there is doubt about capacity, a medical assessment can be made and a certificate provided.

The second reason it’s wise to have a specialist solicitor prepare your Will is that they will make sure  your Will says everything it should, in the right way. The ideal outcome is that a Will is thorough and easily understood and applied after a person’s death.  A document that doesn’t deal with the entire estate, doesn’t properly identify beneficiaries, uses contradictory or otherwise unclear language, or attempts to put in place arrangements that may be unwise or even illegal or otherwise unenforceable, will cause problems further down the line. It’s our job to help clients get the right provisions in place, taking account of their personal circumstances. This can lead to broader discussions around tax efficiency, for example, which can be useful to clients keen to maximise the value beneficiaries will receive from the estate.

Writing your own basic Will could well bring some benefits, but there is a danger that it will create uncertainty and perhaps even conflict in your family. Having a lawyer alongside you as you collate details of your estate and its value and make important decisions about beneficiaries and inheritance can significantly improve the outcome. And you’ll get peace of mind that the right people stand to benefit as you’d like them to once you have passed away.

For advice about making a Will or amending a Will you have already made, contact Emma Howlett or a member of the Wills & Probate team on 0808 256 2917.

How have the intestacy rules changed?

The Government has announced that the statutory legacy will increase from £270,000 to £322,000 with effect from 26 July 2023.

What is the Statutory Legacy?

If a person dies without a Will (known as dying ‘intestate’), their estate will be divided according to the rules of intestacy. A significant component of these rules is the ‘statutory legacy’, which may not reflect one’s personal wishes.

In simple terms, the statutory legacy is a fixed sum of money that a surviving spouse or civil partner is entitled to when their partner dies intestate, and they have surviving children. The amount of the statutory legacy can change over time, being updated to reflect inflation and other economic factors.

The remainder of the estate, after the statutory legacy has been paid, is then divided according to the rules of intestacy. This often means that the remaining assets are shared between the surviving spouse and the children.

While the statutory legacy might offer a degree of protection, and the increase to £322,000 is certainly welcome, it’s a blunt tool in the nuanced world of personal relationships and individual wishes, and can have many unintended and negative consequences.

Potential pitfalls of not having a Will

  • Unintended beneficiaries: The rules of intestacy are generic, so they might not reflect your personal relationships or your wishes for your assets. Close friends, unmarried partners, and even certain relatives might not receive anything from your estate.
  • Delayed access to assets: The process can be time-consuming, causing additional stress for your loved ones during an already challenging period.
  • Additional costs: dying intestate may lead to increased legal fees and potential court proceedings, diminishing the assets available to beneficiaries.
  • Lack of control over children’s inheritance: Without a Will, children automatically inherit at the age of 18. This might not align with your wishes or the maturity level of the child.

You can avoid leaving the division of your assets to a one-size-fits-all system by drafting a Will to protect your loved ones, ensure your wishes are respected, and potentially save on taxes and legal fees.

Our team is here to help. For professional advice about drafting a Will that reflects your personal desires and safeguards your family’s future, contact Emma Howlett or a member of the Private Client team on 0808 256 2917.

The New Year’s resolution you can stick to…

Exercise more? Cut out alcohol? Make a Will?

Good intentions come in all shapes and sizes. And a new year presents that perfect opportunity to make changes, to improve, to get things done. It feels like a time to start afresh, with a positive attitude and a determination to shake off the old.

That’s the theory, anyway. (How many of us have made resolutions, only to fall at the first hurdle?) But the experts say it’s all about setting achievable goals. It’s about pinpointing what needs to be done, what can be achieved and committing to doing it.

As a legal expert who helps people get their personal affairs in order, clients sometimes come to me in January with one question: I need to get myself organised, but I have no idea where to start. My response? Let’s talk about your situation.

Personal circumstances dictate what measures should be put in place, how and when. Some clients will have particular concerns – how to ensure the right people will benefit from their estate, how to minimise tax, how to earmark money for care home fees, for example – and we’ll talk through the best ways of achieving those aims. There may be things clients haven’t considered – a discretionary trust or a living Will, for instance. And there will be clients who know what they need and simply want us to get the paperwork in place. The key thing in each of those scenarios is understanding the full picture, so that the future planning fits together cohesively.

This all has to start somewhere. And my message for now is: use January to get the basics done. A Will and a Lasting Power of Attorney are two documents that can be put in place relatively quickly and they offer peace of mind that aspects of your future, and that of your family, are taken care of.

Why a Will?

Everyone should have one. It is the legal assurance that your estate will be dealt with in the way you want after you have passed away. It can be used to express certain wishes and it means your family will avoid being subject to the rules of intestacy which add complexity to the estate management process and could mean significant people in your life don’t inherit. It’s even more important to have a Will if you and your partner are not married or in a civil partnership, as the law offers less protection to cohabitees – you may not inherit your family home in the event your partner dies, for example.

Making a Will gives peace of mind, but it’s not something you should forget about once it’s been written and filed away. It’s really important to check in on your Will every three to five years and always when aspects of your life change – a new baby, you receive some inheritance, your executor passes away, you marry. If you need to make a change, your solicitor will be able to advise you on whether to prepare an entirely new Will, or whether the change can simply be made via a ‘codicil’ – a formal alteration.

Why a Lasting Power of Attorney?

These are usually very straightforward to put in place, and there can be huge advantages to having one. A Lasting Power of Attorney appoints people to make certain decisions about your property and finances or your health and welfare if you become unable to make those decisions for yourself. It’s a bit like an insurance policy; you might not need to call on it, but it’s there if you do. None of us knows if an accident or an illness might rob us of our mental capacity, leaving us unable to take proper care of ourselves. A Lasting Power of Attorney means the right people are ready to step in if called upon.

As with Wills and other future planning documents, it’s important to update your Lasting Power of Attorney if relevant change happens in your life. You might need to appoint an additional attorney, or replace one who can no longer carry out the role. You may want to change an instruction or preference you’ve set out. Making sure the Lasting Power of Attorney keeps apace with developments means you’ll have a document that offers you the best protection.

Of course, there are many other aspects of future planning that can be put in place relatively quickly and which will reassure you and your family for the years ahead. The most important thing to do is: something. Taking steps now to get plans in place will place one, giant tick on your to-do list. And speaking with a Wills and inheritance specialist is a great place to start. They’ll help you map out a plan and get those vital legal and financial provisions in place.

For advice about making a Will or a Lasting Power of Attorney, or any other aspect of future planning, contact Emma Howlett or a member of the Private Client team on 0808 256 2917.

Funeral plans as part of Will preparation

How does the thought of planning your funeral sound?

While we’re all encouraged to live ‘in the moment’ as much as possible, thinking ahead is important if we want to make things easier for those we leave behind. Powers of attorney, trusts, Wills, and tax planning are all part of that process, without which loved ones face a less straightforward route to dealing with our affairs and, potentially, inheriting less of the value in our estate.

My question to clients is always: if there are steps you could take now to improve things for those you care about, why not?

Making your funeral wishes known is one way of easing the burden on those who would otherwise have to make decisions on your behalf. Family members tend to take charge of arranging funerals, although this responsibility is technically that of the executors of a Will. In many situations, the executors will be family members, so that by itself may not be a problem. What can cause a problem, however, is where clear wishes haven’t been expressed (perhaps there is no Will, or there is nothing else to suggest what the person who has died wanted for their funeral) and there’s a disagreement within the family about what to do. The division could be over something fundamental, like burial or cremation. Or it could come down to the detail of the service, the location, music, eulogies, or format of the day.

There is nothing to say that funerals have to be mapped out in advance and quite often this isn’t possible. However, doing so needn’t be difficult or time-consuming. Some people choose to factor their funeral into writing their Will, and lawyers like me help them focus on the key things as well as the smaller details that could really make a positive difference to the situation in which loved ones will find themselves. Others might decide to record their wishes as an ‘addendum’ (additional document) to their Will, which means the Will they’ve already made doesn’t have to be changed. And some people simply write their wishes on a piece of paper and file it in their desk drawer. The key point is the people who will need to know about those wishes will discover them and, although they’re not legally bound to, will act in accordance with them.

Clients often ask me if they should tell family members about their funeral plans. This is a hugely personal decision and one for people to take individually. It can be reassuring from both perspectives – there is comfort in knowing that wishes have been made clear and are accepted. However, there is always a risk that certain wishes may spark strong feelings and even conflict within families. You could find yourself under pressure to change your mind about some of the wishes you have expressed, which may or may not be a positive development.

Having a good understanding of the likely responses and reactions will help you decide how best to handle conversations with loved ones. It is something I help clients navigate as part of their future planning, because while this sort of preparation is ostensibly about the person who puts the plans in place, the real impact will be felt down the line. It is the reason people are quite rightly keen to make the best decisions at the right time.

For advice about funeral arrangements, Wills, or any future planning, contact Dalia Sainsbury or a member of the Private Client team on 0808 256 2917.

When Wills are changed

The Express newspaper recently highlighted the turmoil that can ensue when families are locked in a row over inheritance (see article).

The story centred around the entitlement of ‘Lord’ Brett McLean to the £300,000 home left to him by his mother, Maureen. Reports say that in 2017, Maureen and her husband Reginald (who had three children by his previous wife, before Brett was born to him and Maureen) made Mirror Wills, specifying that all four children would share the house and the rest of their joint estate equally after the parents had passed away. When Reginald died, everything transferred to Maureen, but shortly before her death, Maureen changed her Will, cutting out her stepchildren and leaving everything to her only biological son, Brett.

The judge found that Maureen had been entitled to do this. She may have been morally bound not to change her Will, but she wasn’t legally bound not to.

The case demonstrates one of the potential problems with Mirror Wills: there may be nothing to stop a surviving partner from diverting inheritance away from certain family members when their partner is no longer around to have their say.

But what are Mirror Wills? And why are they used?

As the name suggest, these are two Wills that reflect each other. Their terms are virtually the same, and so they’re most often used by couples that have the same wishes when it comes to who should inherit their assets. They’re relatively simple to put in place and one of their major benefits is that they can help reduce the amount of inheritance tax that may ultimately be payable. Assets can be transferred tax-free between married couples and between civil partners. The surviving partner will also inherit their partner’s inheritance tax allowance, and when the surviving partner dies, their allowance can be added on. This could give the couple’s children (the next in line to benefit) their parents’ combined tax allowance.

Mirror Wills can be extremely beneficial, but they carry one significant risk: the relative ease with which they may be changed, either during both partners’ lifetime, or after one has passed away. If the surviving partner goes on to form a new relationship, he or she may decide to make their new partner the beneficiary to assets originally intended for children of the first relationship; or they may decide to change their Will to disinherit other family members – stepchildren, for example.

People don’t enter into Mirror Wills thinking this might happen. The couples we advise believe wholeheartedly that they’re on the same page, that things won’t change and the wishes they’ve agreed on will be carried through. For families dealing with the aftermath of a situation that has panned out differently, things can get incredibly complicated and sometimes relationships become damaged beyond repair.

One way of potentially avoiding this problem is by creating Mutual Wills. These are also virtually identical to each other but they’re a lot more difficult to alter. The parties agree not to change the Will without the other’s consent. And when one of them dies, the Will can’t be changed at all – even if the surviving partner goes on to remarry.

Understanding your options, and putting the right measures in place, are key to having peace of mind that you’ve done everything you can to ensure your wishes are carried through. Complete certainty may be elusive when it comes to Wills, but there are certainly ways of getting as close to that as possible.

For advice about making a Will, updating a Will, or any other aspect of future planning, contact Dalia Sainsbury or a member of the Private Client team on 0808 256 2917.

How the law could help families keep more memories alive

If I asked you to list everything you own, would you think about the camera roll on your smartphone?

People tend not to see digital assets, like photos, music playlists, social media accounts, as ‘assets’ in the usual sense. Aside from cryptocurrency, these things may not hold a recognisable financial value or represent something similarly tangible to a home, an engagement ring or money in the bank. But digital assets exist, and they outlive their creator or owner. And for loved ones left behind, digital assets maintain an important connection to the person they have lost.

As the number and types of digital assets have grown, so too have issues encountered by people who want to access them following a person’s death. For good reason, password and data protection is robust. And while it would seem sensible to allow a daughter to access the photos on her deceased mother’s phone, or a widower to get into his wife’s Facebook account, this has historically been less than straightforward. It is a situation that has increased the pain and suffering felt after a loved one’s passing. And it has led to a Private Members’ Bill that is making its way through parliament.

The Digital Devices (Access for Next of Kin) Bill would give a grieving relative the right to access their loved one’s digital data. It also places an onus on tech companies to facilitate this, by unlocking devices for which people don’t have access codes.

The Bill has some way to go before becoming law, but I very much hope that its journey leads to these significant changes being made. Clients who come to see me after the death of a loved one are often overwhelmed by the formalities that need to happen. Everything, from the clearing out of clothes from the wardrobe, to the gathering in and division of assets and liabilities, places a strain on already fragile people who are doing their best to get through the hardest of times. To then be faced by a brick wall when attempting to retrieve their loved one’s digital data has felt an unfair additional challenge.

So, the Digital Devices Bill is something I wholeheartedly support. It should remove a significant disadvantage currently suffered by families who simply want to keep memories alive and prevent digital assets from becoming lost. But there are also things that each of us can do now to make the future process of administering our estates as straightforward as possible for our loved ones.

I would urge anyone preparing for the years ahead to get specific advice on how best to deal with digital assets as part of the process of writing a Will or a Lasting Power of Attorney. (It’s important to understand, as a starting point, whether each of these assets is owned outright by you, or whether it is licensed to you, for example.) Working through this now will reap rewards, leaving fewer difficulties for loved ones to navigate in the years to come.

For advice about organising your affairs, or specifically about digital assets, contact Emma Howlett or a member of the Private Client team 0808 256 2917.

Could leaving money to charity mean less inheritance tax?

Future planning, including writing a Will, isn’t just about deciding how assets should be allocated. It’s also about making the very best of those assets, preserving their value and minimising the tax that will be charged to an estate after their disposal.

A large part of what I do is guiding people towards the most tax-efficient arrangements. And one of the lesser-known ways of reducing tax liability is by leaving money to charity.

A charitable gift doesn’t attract inheritance tax (IHT). In addition, this type of gift could actually lower the IHT rate that applies to the remainder of an estate. Estates valued at £325,000 or more usually attract IHT at 40%. However, a charitable gift may reduce that to 36%. To qualify, the gift needs to be worth at least 10% of the net value of the estate. This takes some careful calculating and, as a Wills and inheritance specialist, this is something I help clients plan.

Precision around this is really important if the terms of the Will are to be carried out in the way intended, and if they’re to have the desired effect.  First of all, you need to make sure your proposed charitable gift would qualify. And then you need to think about how you will frame that gift. You might want to leave money to a particular charity for a specific purpose, such as services in your local area, or care of certain people or animals. You might want to consider a revisionary gift, which means the charity is second-in-line to receive it, after a family member or friend. (That could work in the case of a property or an investment fund, for example.) These are just some of the possibilities that could provide the dual advantage of putting your assets to good use and lowering the tax bill that will be payable on what’s left.

Charitable gifts are not without their potential difficulties, however. People are not always accepting of their relative’s decision to divert inheritance away from the family. They might treat the decision as having been made ‘in the heat of a sibling rift’, or without full appreciation of the consequences. Relatives might not understand that it was done in a calculated way to bring about IHT savings. The scale of these problems obviously depends on the circumstances – not least the value of the charitable gift. It can also depend on the manner in which family members discover the arrangement.

I encourage clients to talk to those close to them about their plans, including when those plans might not be quite as expected. The chance to explain to loved ones why you have arranged things in the way you have can be so important to them respecting your wishes. Ultimately, this can lead to fewer issues in families later on.

To speak to us about making or updating a Will, or about any other aspect of future planning, contact Emma Howlett or a member of the Private Client team on 0808 256 2917

Video-witnessed Wills legalisation extended

It’s been done on driveways, over garden fences, on car windscreens. Covid has taught us many things, including that when a Will needs to be witnessed, a way will be found.

In January this year, the government announced that it would be extending the measures that gave some people who were making Wills a far more straightforward way of having them witnessed. The introduction of video-witnessing in September 2020 was set to apply to Wills made between 31 January 2020 and 31 January 2022. A further two years has now been added to that timeframe, meaning vulnerable people (including people who are forced to isolate because of Covid) in England and Wales will, as a last resort, be able to have their Will witnessed by video-link up until 2024.

It’s a move we welcome. While the number of our clients who have been forced to use video-link is relatively small, the fact that this is in place if it’s needed is hugely reassuring. Will-witnessing usually requires two witnesses to be physically present in the same space as the person making the Will. For those who cannot come into close contact with others while Covid looms, the ability to carry out this essential formality via live video (subject to safeguards that prevent undue influence and fraud) means there are no delays. A Will can be prepared by a solicitor and the witnessing can quickly follow. And in some cases, where time is of the essence, this could mean the difference between someone dying with a Will in place and without.

The main benefit of making a Will is certainty that assets will be dealt with as you’d like them to be after you have passed away. The alternative – intestacy – can lead to very different outcomes. These can include assets going to the ‘wrong’ people, and loved ones finding themselves harder hit by tax liabilities that come from an estate that had not been arranged before its owner’s death.

So the case for making a Will is strong. And it’s also so important to keep your Will up-to-date, as changed family and financial circumstances can mean Wills drafted many years ago are either no longer appropriate or don’t lead to the most favourable position for family members. Extending the video-link witnessing provision is (alongside other available online facilities) another step in the right direction towards removing barriers for people keen to get their affairs in order.

But will video-links will remain a possibility beyond 2024, or will they become filed under ‘Covid-19’? We’ll have to wait and see.

To speak to us about making or updating a Will, or about any other aspect of future planning, contact Emma Howlett or a member of the Private Client team on 0808 256 2917

How ‘private’ is a Will?

News that Prince Philip’s Will is to be kept sealed for at least 90 years has highlighted the reality that, without some form of judicial intervention, people’s final wishes are generally open to inspection.

The decision, which is planned to be reviewed in just under a century’s time, is said to have been taken in order to protect the Queen’s dignity and standing. So, for now, details of Prince Philip’s estate and his beneficiaries will remain under wraps. But this has sparked conversations about what usually happens to a person’s Will once they have passed away. Who takes charge of it? And who gets to read its contents

Making a Will might seem a private matter, and in many respects it is. Your Will is yours. It’s not for anybody else to tell you what to include in it – in fact, undue influence could render the Will invalid. Your solicitor will advise you, personally, on a one-to-one basis. They’ll discuss with you the types of things to consider, and the best ways of structuring the allocation of your assets. Ultimately, they will follow your instructions; implement your decisions. And at that point, the lid is usually placed on a Will and it is safely stored away.

That said, Wills do not necessarily remain private. You shouldn’t expect yours to be widely read after you have passed away, but once a grant of probate (the authority for the executor(s) to start dealing with your estate) has been issued, your Will becomes publicly available. Anyone could request a copy via the government website. It’s another reason to consider very carefully what you put in your Will. If there are things you wouldn’t want to be made public (certain instructions or explanations, for example) your solicitor will be able to help you express these elsewhere – usually in a separate, private, ‘letter of wishes’.

Clients often ask us about the process of ‘reading a Will’. They picture a gathering of family members, a solicitor, and maybe a Chesterfield and a crackling fire. But this doesn’t normally happen. Instead, the person appointed as the executor will take the reins. He or she (or maybe they, as there an be more than one) will get hold of the Will, usually from the deceased’s solicitor, and will apply to the probate registry for the grant of probate. Once the green light has been given to start administering the deceased’s estate, beneficiaries will usually be notified of their entitlements. However, not all will be entitled to see precise details relating to the deceased’s assets and liabilities.

What if you are excluded from this, perhaps because you are not a beneficiary, or because the executor doesn’t appear to be doing everything they should? Applying to see a copy of the Will could be an option worth pursuing. The terms of a loved one’s Will can sometimes take family members by surprise, and some feel it’s therefore important to see the Will for themselves. This could also be the starting point if the Will is to be challenged, or if a claim to entitlement based on dependency is being considered.

There are huge sensitivities around Wills. As lawyers who specialise in helping people and families manage their affairs, we understand the emotional challenges that come with preparing for the future, and also of course in dealing with the loss of a loved one and the practical arrangements after their death. We encourage people not to shy away from making plans, nor from having related conversations with those close to them. Because while your future planning – your Will, your trusts, your investments – may be for you alone to put in place, it stands to significantly affect those important people in your life. Your plans can become their future.

For advice about making a Will, or any other aspect of future planning, please contact contact Emma Howlett 0808 256 2917 or email [email protected].

My father is becoming forgetful. Should we be thinking about legal protections for him?

It is always concerning when a loved one appears less able to do things they once could. While slower bodies and minds are the unavoidable byproduct of ageing, you are certainly right to be thinking about the possibility that your father may at some point need greater help from those around him.

Depending on your father’s condition, you may want to look into any care needs he has now, and those he might need before too long. Is he living alone? Is that safe for him? Should you be thinking about lining up a different arrangement?

And one of the things I think you should definitely be considering is a Lasting Power of Attorney (LPA). This is a legal document that appoints someone, or more than one person, to take control of decisions about the day-to-day life, finances and wellbeing of someone who has lost mental capacity. There are two types of LPA: one for health and welfare, and one for property and finance. Quite often, the same attorneys (usually family members) are appointed in respect of each.

An LPA is made while a person still has mental capacity, and usually comes into effect if that capacity becomes lost. Timing is therefore extremely important. There is no point in thinking about the LPA option once a person no longer has mental capacity; they have to be shown to have the ability to make decisions for themselves in order to make a valid LPA.

Where a person has simply become forgetful, it is unlikely that they have lost mental capacity. The time would therefore be ripe to help put an LPA in place for your father.

What is mental capacity?

Mental capacity is someone’s ability to make a decision. Incapacity strikes when decisions can’t be made because of a temporary or permanent impairment of, or a disturbance in the functioning of, the mind or brain.

Being ‘unable to make a decision’ means not being able to understand relevant information, retain that information, use or weigh that information, or communicate the decision.

Why have a Lasting Power of Attorney?

If a person loses the ability to make decisions, the next best thing is for someone they know and trust to do that for them. An LPA allows this to happen very easily.

When someone loses mental capacity without having an LPA in place, there will usually need to be an application to the Court of Protection. That is the specialist court responsible for taking care of people who have lost mental capacity. It can appoint ‘deputies’ to act in much the same way as attorneys under LPAs and make decisions in the person’s best interests. A major difference, however, is that the person in whose interests decisions will be made has at that point no say in who becomes his or her deputy, whereas the ability to nominate attorneys via an LPA places that control firmly in the hands of the person at the centre of it all.

What about a Will?

An LPA is not an alternative to having a Will. The two documents do different things, and ideally people should have both in place.

While few people feel completely comfortable discussing Wills and other future plans with parents, it really is a good idea to bite the bullet. Encouraging loved ones to think ahead and to talk about the arrangements they have and could put in place can make so many things far easier in the long run.

To find out more about LPAs, Wills and future planning, or for advice on your particular situation, contact me on 01892 337540 or at [email protected].

Why your Will isn’t set in stone

When someone makes a Will, they rightly expect the wishes they have set out to be carried through. In most cases, that is exactly what happens; the executors distribute assets to the chosen beneficiaries, and deal with all other necessary arrangements to manage the deceased’s affairs.

There are situations in which a Will may be challenged by those who are not set to inherit as expected, or where there are doubts about the validity of the Will: was it forged? Was the Will-maker pressurised into making certain provisions? Did he or she understand what they were signing? If successful, a legal challenge can lead to terms other than those set out in the Will being put into effect. However, those situations do not commonly arise. It is far more likely that that the Will will simply be applied as the Will-maker intended.

But what if those terms reflect ‘old’ wishes? Too few people update their Will over time. And the trouble with that is that the Will that stands to determine inheritance (and other things) may not be a fair reflection of the deceased’s situation in the lead-up to their death. It could lead to the ‘wrong’ people benefiting, and the ‘right’ people missing out. Equally, the financial provisions made may be less beneficial – and perhaps even detrimental – because of changes in the law that may have happened since the Will was made.

Just as you would review your investments, your insurance policies, your future planning, you should periodically check in on your Will. We advise clients to do this annually. This may just involve you casting your eye over the provisions you have made and making sure that they are still appropriate and relevant to where you are in your life. Because that is exactly what a Will is: a reflection of your circumstances and your wishes at a particular time. These things can change, and it’s vital that your Will keeps apace.

As well as revisiting your Will periodically (ideally, with your solicitor), significant events in your life should trigger a review. A new baby in the family, some inheritance, a new house, a relationship breakdown. These are all things that could affect the provisions you have made in your Will, and could mean you need to rethink the allocation of your estate and your provisions for your loved ones’ futures.

In the context of future planning, there is one particularly significant marker in a person’s life: marriage. It’s not just that having a new husband or wife means priorities tend to change. It is also that marriage cancels out any existing Will, so it’s as though no Will had been made. And that can lead to a situation in which a person’s estate is dealt with under the rules of intestacy.

If intestacy applies, the deceased’s possessions will be distributed to particular people, in a particular order. The rules are strict and, of course, the deceased will not have had a say in who inherits. It is not a situation that many people or families would choose to be in. It’s why people make Wills.

Our message is: don’t just make a Will; keep it up-to-date! It really isn’t onerous to do. Your solicitor will be able to draft a ‘codicil’ that will sit alongside your Will, setting out any new provision. This should ensure that the things you intend to happen after your death happen.

For advice about anything to do with Wills, probate or future planning, contact me on 01892 337540 or at [email protected]

 

 

 

 

Finding the Will

I talk a lot about why it’s important to make a Will. You get to decide who to pass things on to. It makes things easier for those you leave behind. It’s just good preparation; good housekeeping, if you like.

When someone dies without having made a Will, there can be a great deal of uncertainty about what should happen to their assets and liabilities. These things – whether they’re physical property, like a home and possessions, or money tied up in accounts (and debts owed) – have to be dealt with. And where a Will has not been left, the rules of intestacy determine how that should be done and who should inherit. Intestacy is rarely a straightforward process and it can be particularly difficult for family and friends who are coming to terms with their loss.

So, the sensible option is to make a Will. But it’s important once you’ve made your Will to make sure it will be found once you have passed away. This might sound like pretty basic stuff, but you’d be surprised at the number of cases I’ve dealt with over the years where family and friends have been at a loss as to the whereabouts of a loved one’s Will. They tell me, “I’m sure he made a Will”, or “She probably would have”. But that is sometimes about as certain as it gets because they simply don’t know for sure whether a Will exists or where it is. In some situations, family members assume there’s a Will when there isn’t – one was never made, or it has been destroyed.

Tracking down a Will can be simple, or it can be extremely difficult. The ideal scenario is that the deceased had let family members know that they had made a Will and where it was kept. However, in my experience, this is something quite frequently overlooked.

It’s relatively common for a Will to be filed away at the deceased’s home, so it’s always a good idea to check through desk drawers and cabinets. But where that proves fruitless, or where you want to check that the version you have found is the most up-to-date (remember that Wills can, and should, be updated over time), the next port of call will usually be the deceased’s solicitor. Law firms like ours usually store Wills in the strongrooms of our offices. So if you know the name of the deceased’s solicitor or firm, contacting them would be a wise move.

There are other avenues that can be explored if nothing has turned up. These include checking with the deceased’s bank (a safe deposit box, perhaps?) or with their other professional advisors.  An appeal for information can be placed in the Law Society Gazette. And there are various organisations whose job it is to search for missing Wills; you could try one of those.

It’s important to exhaust every possible route to laying your hands on the original, signed Will (and not merely a copy). That is the document that will need to be inspected by the Probate Registry before permission – a Grant of Probate – will be given for the deceased’s estate to be distributed. In some cases, a Grant of Probate will be issued even though the original Will has not been provided, although whether a copy will be acceptable will depend on all the circumstances, including who would stand to benefit/lose out if the copy Will were/were not allowed to stand.

That is all best avoided if possible. It’s why when we advise clients on making their Will, we discuss storage options and recommend they keep at least one close family member informed of the details. And if all paperwork – share certificates, insurance documents, deeds, financial documents, for example – are also neatly filed away, that too will make the job of distributing your estate so much easier for those you leave behind.

Need a Will?

For advice about making a Will, or to discuss any aspect of Wills and Probate, contact us 0808 256 2917 or email [email protected].

A Taxing Time

Now is not the right time to outline long-term plans’.

Those were the words from the Treasury as it announced that this autumn’s Budget would not be going ahead. This didn’t come as a surprise; many people will have seen the scrapping of the Budget as the only option given the current state of mid-coronavirus flux.

But what does seem certain is that when the Budget eventually happens, we will face a tougher tax regime that seeks to pay towards the huge financial buffer put in place to protect jobs and the economy during the pandemic.

None of us can say for sure what those changes will be, or just how they will affect people, families and businesses. And with regime change likely, you may be unsure about how best to prepare for the future or whether to do so at all.

We’re urging our clients not to press pause on their financial planning. In fact, now is a great time to take stock; to get your affairs in order and revisit any existing arrangements. Build a detailed picture of your assets – your possessions, property, money, investments, shares – and start to think about passing these on to the right people in ways that will retain their value and give maximum benefit.

As Private Client solicitors, we help clients achieve that by advising on creating trusts and on making lifetime gifts, both of which can reduce beneficiaries’ liability for what is possibly the most unpopular tax of all – Inheritance Tax (IHT). Under current rules, up to £500,000 out of one person’s estate (‘estate’ being the things you own) can be passed on to beneficiaries without triggering IHT. That half-a-million figure is made up of £325,000 out of the estate, plus £175,000 representing the ‘main residence’ band (ie your main estate is being passed to a direct descendent). Once that £500,000 figure is reached, the value of anything above it is usually taxed at 40%. That percentage can be reduced a little if you leave some money to charity. And a whole estate passed on to a spouse or civil partner should not attract IHT at all.

While IHT only kicks in if the assets you are passing on are valued at more than £325,000 (or £500,000 if the main residence band applies), it remains a real concern for those people and families that have more to their name. The prospect of handing over to the Treasury almost half of the value of assets in excess of the £500,000 limit can be unappetising, to say the least.

Earlier this year, MPs called for the standard 40% rate to be cut to 10%. They also called for most reliefs, including the ‘seven-year rule’ (the rules that says that IHT will be charged on gifts worth more than £325,000 if you die within seven years of making them) to be scrapped. With the government eager to claw back money handed out during the coronavirus, it is difficult to see how reforms that would ostensibly lead to lower recoupment via tax would appeal to the Treasury at this time. But that of course depends on the merits of other new  provisions.

Let’s see what comes of the rescheduled budget. And if we can offer one piece of advice in the meantime, it is: don’t leave your financial future, and that of your loved ones, to chance.

  • Make a Will.
  • Review an existing Will to check it’s up-to-date as well as still being relevant and viable.
  • Consider ways of clearing and structuring debts (remember  that while debts reduce the value of an estate – potentially taking it below the IHT threshold – they still need to be paid out of the estate before inheritance can be distributed to beneficiaries).
  • Get good advice on maximising your tax-free allowance and on dealing with assets during your lifetime to tee-up a better financial outcome for your beneficiaries.

Whether you are a natural planner or not, there’s really no substitute for thinking ahead when it comes to passing on the assets you’ve worked hard to accumulate. Our team is here to help you do that.

For advice about any aspect of Wills and inheritance tax, contact us 0808 256 2917 or email [email protected].