Preparing a Will allows you to take control of your estate and ensure that on your death, your assets pass in accordance with your wishes.
It is important to keep your Will under review as your circumstances, and the law change over time.
It is particularly important to review your Will at the following life events:
1. When purchasing a property or other significant asset;
2. On the birth of a child or grandchild;
3. Upon marriage or civil partnership; or
4. Separation or divorce.
If there are any queries about mental capacity, we can advise on how to ensure that the Will is validly executed, or apply for a Statutory Will where this is not possible, and have experience dealing with vulnerable clients.
Inheritance tax planning
Preparing a Will can help you take advantage of the inheritance tax allowances available to you and thereby minimise the tax liability on your death.
Individuals currently have a nil rate band exemption of £325,000. This can be transferred between spouses, so on the death of the survivor their estate can benefit from a nil rate band of up to £650,000.
Any gifts you make within 7 years of your death will fall back into your estate for IHT purposes and will use up this tax free allowance. Our team can advise on the options available to you to ensure that the asset(s) you are gifting pass effectively out of your estate without being chargeable to IHT. There may also be income tax and capital gains tax considerations, and we can recommend and liaise with accountants to provide advice on this aspect if necessary.
The introduction of the residence nil rate band in April 2017 creates an additional inheritance tax liability when the family home passes to direct descendants of the deceased. The current allowance is £125,000 but this will rise to £175,000 by 2021.
If your circumstances are more complex, a trust structure may be appropriate to help you protect your assets and hold them for specific family members.
Trusts can be particularly useful when you have children that are minors and/or from a previous relationship or you want to provide for a vulnerable beneficiary. If your future circumstances are uncertain at the time of making a will, a discretionary trust can also be a useful mechanism to allow your trustees the flexibility to adjust to developments in your estate and/or your beneficiaries’ needs.
Our team is experienced in advising on the pros and cons of different trust structures including on the tax benefits or implications.