Probate Wills & Trusts
Probate and Estate Administration
Dealing with the death of a relative or close friend is often difficult, and if you have been named as an executor in the will, dealing with the estate may be the last thing you want to worry about at such a time. Or indeed where there has been a death and the deceased left no Will you may require guidance as to how the intestacy rules operate, any entitlement you may receive and distribution generally.
In some cases, the person who has died may not have left a will, this is what is known as dying intestate. We can guide you through the process of registering the death, and sharing out the estate according to how the Will or intestacy rules dictate.
We can assist to relieve you of the burden, or even of just some of the elements, in a sympathetic and efficient manner. We are happy to assist in small estate matters but, our experience ranges to dealing with multi-million pound estates with foreign assets, business assets and agricultural land.
We will provide you with an estimate of our costs at the outset and in some circumstances are able to agree a fixed fee, to handle any or all of the following:
• General administration of the estate
• Obtaining the Grant of Probate
• Distributing assets to beneficiaries
• Inheritance and capital gains tax
• Estate accounts
• Administration of trusts
We can help with any of the above. You may decide there are some aspects you wish to do yourself, in which case we are more than happy to advise on the steps you need to take.
Making a Will
An estimated 70% of us die without having made a Will. There are a number of benefits why people should make Wills, as follows:
• A Will allows the persons making the Will to determine how his/her estate is distributed on death;
• A Will enables the person to make other provision for his/her family and dependents (for example, by way of a trust) than that offered under the Intestacy Rules;
• There may also be considerable tax advantages to be gained from a carefully drafted Will, particularly where tax planning is considered in conjunction with lifetime planning;
• A Will allows the person making the Will to appoint who he/she wishes to appoint as Executors/Trustees, whereas where there is no Will the choice of administrator is governed by the Non-Contentious Probate Rules 1987;
• A Will may also incorporate additional powers to facilitate the administration of the estate. This is of particular relevance where, for example, the estate comprises a business which needs to be managed or sold during the administration period and clearly such powers can ultimately be a great benefit to the residuary beneficiaries of the estate;
• A Will may also include the appointment of a guardian for the Testator’s/Testatrix’s children, which will be an important factor for clients with young children;
• In addition, where parties are not married and are cohabiting it is important to make a Will as the Intestacy Rules make no provision for long term cohabitees either in mixed or same sex relationships;
• It is also important to be aware that marriage/civil partnership revokes a Will, unless your Will has been made in anticipation of your marriage/civil partnership;
• In respect of a Decree of Divorce or Nullity the Law Reform and Succession Act 1995 (LR(S) A 1995) provides that any gift to a former spouse passes as if the former spouse had died on the date of divorce or annulment and any provisions appointing the spouse as executor/trustee or guardian take effect as if the former spouse had died on this date – unless there is a contrary intention contained in the Will.
If you do not have a Will in place or if your circumstances have changed and you require a revised Will or Codicil or have any concerns about any issues discussed in this article then please do not hesitate to contact Claire Maxwell.
Inheritance Tax and Lifetime Gifts
As Benjamin Franklin once said: “……in this world, nothing can be said to be certain except death and taxes”. Most of our clients are only too aware that this is the case and a key element when considering any Will or estate administration is the mitigation of such tax. The most significant tax for any probate practitioner is Inheritance Tax and an important aspect for many of our clients is the mitigation of such tax, this can be done through the use of exemptions and reliefs (exempt transfers meaning transfers having no tax consequences at all and reliefs operating by reducing the amount of tax payable).
The Inheritance Tax nil rate band is neither an exemption nor relief but, is in fact a zero rate of tax the current nil rate band is £325,000.00. Therefore, if your estate is below this level Inheritance tax will not be payable. However, the Government has announced increases to the Inheritance tax nil rate bands for the following tax years:
2010/11 - £350,000.
(Although, the Conservative party have suggested that they will raise the Inheritance Tax threshold to £1,000,000.00 in the event they are elected).
In addition, it is now possible to transfer unused nil-rate band allowances between spouses or civil partners. The new rules apply to allow a claim to be made to transfer any unused IHT nil-rate band on a person’s death to the estate of their surviving spouse/civil partner where death occurs on or after 9 October 2007.
Any sum over and above these amounts may result in an Inheritance Tax liability of 40% charged on the value of your estate over and above the threshold as at the date of death. As a consequence mitigating the liability to Inheritance Tax is often one of the main concerns of our clients.
Please contact Claire Maxwell for further information.