Why should
I ask a solicitor to help me make a will?
There are many ‘will writing’ products on the
market and in theory you can make your own will. However, the rules
for making a will are complicated and for a relatively modest fee a
solicitor can ensure that:
- your will is completed correctly and is a valid legal
document;
- you distribute all your assets, avoiding a possible claim from
the Crown against your estate;
- you make clear your wishes in the event that one of your named
beneficiaries dies before you do;
- you receive advice on how to avoid paying unnecessary
inheritance tax.
Badly drafted wills are responsible for a
number of damaging probate disputes each year – expensive
litigation is the last thing you want to leave your loved ones.
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I made
a will some years ago so I don’t need to worry about this anymore,
do I?
Even if you have already made a valid will, we
would recommend that you review it regularly. Your life
circumstances may change: perhaps you are getting married?
Divorced? Perhaps you now earn considerably more than you did when
you made your original will? Or have received an inheritance of
your own? Any significant changes in your status or circumstances
can affect your existing will, and may even make it invalid. If you
marry or remarry, for example, your will is automatically rendered
invalid unless it was made clear at the time that you were
intending to marry and wanted the current will to remain in force
afterwards.
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My partner and I live together but we are not
married. He has children from a previous relationship (although no
other living relatives) but has promised that I would inherit the
house when he dies. I am on the deeds of the house so is it really
necessary for him to make a formal will?
You should definitely get a will drawn up as
soon as possible. Whether or not you automatically inherit your
partner’s share of the house depends on whether you own it as Joint
Tenants or Tenants in Common. If your ownership is as Tenants in
Common then your partner’s share of the property will pass to his
children, as will his other possessions. If you were married then
you would inherit the first £125,000 of your partner’s estate and
receive a life interest in the remainder. You should talk to your
solicitor about making a valid will and also about how you may be
able to avoid paying unnecessary inheritance tax.
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I have two children: a seven-year-old and a
twelve-year-old. I am currently thinking about making a will and
would like to leave my property to my children. Are they too young
to inherit directly?
Since both your children are under 18 then
they won’t be able to inherit directly. But this doesn’t mean they
can’t benefit under your will. Your solicitor will be able to help
you arrange for their inheritance to be held in trust for them
until they are older. Meanwhile, you can ensure that your children
don’t lose out by allowing the trustees you nominate to use the
income and/or capital for your children’s benefit, such as to pay
school or university fees on their behalf.
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Since my divorce, I’ve only been able to make ends
meet with some support from my father. We had a big argument just
before he died, and I now discover that he’s left us nothing. Is
there anything I can do to challenge the will?
Since you were reliant on your father’s
financial support, it may be possible for you to make a claim
against his estate under the Inheritance (Provision for Family
& Dependants) Act 1975. According to this, if you are the
spouse or a child of the person who has died, you can apply to the
court to ask for a lump sum payment from the estate. You will need
to be able to demonstrate that the will or intestacy has left you
without adequate means of support. There is also a time-limit for
making a claim, which is 6 months from the Grant of Probate or
Administration. You should talk to solicitor immediately about the
options which are open to you.
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How much inheritance tax will I have to
pay?
Currently, the first £300,000 of your estate,
known as the ‘nil-rate band’ personal tax allowance, is not subject
to inheritance tax. The threshold for the ‘nil-rate band’ is
regularly revised by the Government and is announced in the budget
each year. Any assets over and above this threshold are taxed at
the rate of 40%. So, for example, if you have a total estate,
including the family home, worth £500,000 then you will pay 40% tax
on £200,000. This works out at a hefty tax bill of £80,000.
However, there are a number of ways in which you can minimise the
amount of inheritance tax you will need to pay. Among other things,
these include:
- making tax-free gifts to charity;
- setting up an appropriate trust;
- making lifetime gifts.
If you own assets above the nil-rate band –
and with the rise in house prices many people now do who wouldn’t
consider themselves rich – then you should talk to your solicitor
as soon as possible about the measures you could take now to save
on inheritance tax.
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I want to set up a Lasting Power of Attorney (LPA)
but I want to nominate different people to take care of my welfare
and business affairs. Is this possible?
Yes. Firstly, you will need to set up two
separate LPAs: a personal welfare LPA and a property and affairs
LPA. In the case of your personal welfare LPA you will need to
choose one or more people over 18 years of age (up to a maximum of
five people) to make decisions about your health, living conditions
and other matters relating to your personal care. In the case of
your property and affairs LPA you can either nominate up to five
different people to look after your financial and business affairs,
or you can opt to appoint a trust corporation. In each case, you
will need to specify how you would like them to act: whether, for
example, you want them to make joint decisions or expect different
individuals to make decisions about particular things.
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