Category Archives: Estate Planning

Leaving a jointly owned property in your Will…

If you own your home jointly with someone else, you should think about how you want to leave it when you write your Will.

There are two different ways in which you can jointly own a property. Only one type of ownership allows you to leave your share of your home to someone in your Will.

Owning your home as a joint tenant

If you and your spouse or partner own your property as joint tenants, then on the death of either of you, the property automatically passes to the survivor. Even if you leave all of your estate to someone else in your Will, a property owned by you as a joint tenant will become solely owned by the other joint tenant.

Owning your home as a tenant in common

If you hold your property with someone else as tenants in common, then your share of that property passes in accordance with your Will. If you don’t have a Will, then it will be subject to the rules of intestacy, which specify which of your relatives will inherit your estate.

This means that if a tenant in common dies, the surviving owner may be forced to leave the home if the person who inherits the other share wishes to sell.

Writing your Will as a property owner

It is always preferable to write a Will, whether or not you own a property, to ensure that your estate passes to those whom you would wish to benefit from it. If you do own a property jointly with someone else, think about what you want to happen after your death.

If you would like to leave your share to someone else, but you currently hold the home as joint tenants, it is possible to sever the tenancy so that ownership becomes as tenants in common. When you own a property in this way, it is also possible to hold unequal shares, for example one-quarter owned by one person and three-quarters by another. This needs to be put in writing at the time the tenancy is created. You can also put details of how you will agree any sale of the property into this document.

Creating a life interest trust

If you want your spouse or partner to live in the home after your death, but don’t want to give them your share of the property outright, your Will can give them a life interest in the home. This would give them the right to live in the property for as long as they want, but ultimately the house would pass to your choice of beneficiary.

This prevents the ‘sideways disinheritance’ trap, where a second spouse could choose to leave the property to their children, excluding the children of the first marriage.

If you would like to talk to one of our property experts or Will writers, ring us on 01243 216900 or email us at info@legalmatters.co.uk.

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Can you leave someone a legacy in your Will and also name them as your Executor?

When you’re writing your Will, you will need to choose the right person to be your executor. We look at what being an executor entails and whether that person can also be a beneficiary.

It is important when writing your Will that the executor you name is someone you trust to deal with your affairs after you’ve gone. Estate administration can be a long and sometimes complicated matter and you need to be sure that the person you have chosen is willing to act and capable of doing so.

It is perfectly acceptable for your executor to be a beneficiary as well, in fact this is often the case.

The role of executor

Your executor will be responsible for all administrative matters, starting with funeral arrangements and registering the death with the appropriate authorities. You can choose more than one executor should you wish.

They need to notify all asset holders and other organisations and then collect in and value the assets.

Other ancillary jobs such as putting vacant property insurance in place and making arrangements to check on any property regularly also fall to the executor.

Once the estate has been valued, tax needs to be calculated and paid. This includes Inheritance Tax, Income Tax and in some instances Capital Gains Tax.

Once the estate is in funds, outstanding debts need to be paid and estate accounts prepared.

The final job is to distribute the estate to the beneficiaries. This may involve transfer of assets and gifts of personal possessions as well as cash payments.

The role of beneficiary

A beneficiary will be notified that they have been left something in the Will, but won’t necessarily be regularly updated on the probate process unless there are delays. As well as receiving their named gift, they are also entitled to see the estate accounts.

If no valid Will exists

Where the deceased didn’t leave a Will, their estate passes under the Rules of Intestacy, which state that assets pass to close family members in a strict order. The spouse is at the top of the list, with children next. The person heading the list is entitled to act as executor if they choose. If they do not wish to take on the role, then the next person has the option of doing it.

By ensuring that you have a valid Will in place, you have the chance to appoint your choice of executor as well as ensuring that your assets are left to those you wish to benefit.

If you would like to talk to one of our expert Will writers, ring us on on 01243 216900 or email us at info@legalmatters.co.uk.

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Big rise in contested estates attributed to DIY wills…

The continuing rise in numbers of contested Wills is being attributed to more and more people attempting to write their own Will.

The number of cases heard by the High Court went up from 227 in 2016 to 282 in 2017 and 368 in 2018.

Drafting a Will

Drawing up a valid Will can be a complicated undertaking. Matters to be considered include whether to leave beneficiaries lump sum gifts or a percentage of the estate, who will inherit first if your estate is smaller than expected, how to ensure first and second families are both provided for, even if you die before your new spouse and how to minimise Inheritance Tax liabilities.

A small error made in drafting a Will can mean that it is invalid. If this happens, then there is a risk that the estate will pass under the rules of intestacy. This details which relatives will receive the estate and in what proportions. Unmarried partners and stepchildren do not inherit anything under the rules.

Why a Will might be challenged

If the wording of a Will is ambiguous or the wrong terminology is used, there may be an opportunity for someone to challenge it in court. Even the incorrect execution of a Will by the signatory and witnesses can mean that a Will is invalid. Mistakes are easy to make in this complicated area, with the risk that will result in a long and expensive court case.

What happens if a Will is challenged

Dealing with a death can be difficult and when family members feel that they have not been left what they felt they were entitled to, problems can arise. When emotions run high, if there is ambiguity or an error in the Will, then they may take the opportunity to bring a legal case. These can take years to resolve and are likely to be expensive. Saving a few pounds now by drafting your own Will can result in the loss of thousands later on if the Will is proved to be invalid or ambiguous.

Why a professionally drafted Will is always recommended

Speaking to an expert Will writer allows you the opportunity to explain exactly what you would like to happen to your estate. If, for example, you have remarried and you would like your spouse to live in your home after your death, but ultimately want it to pass to your children, a professional will be able to explain to you how this can be done and draw up a Will that you can have confidence in.

They will be able to help you avoid pitfalls, such as leaving cash gifts that might reduce your residuary estate far lower than you anticipate and will be able to translate your wishes into a legally binding Will. When a Will has been clearly thought out and well drafted, it significantly reduces the risk that your family will start to wonder if it was exactly what you meant to do.

To speak to one of our expert Wills lawyers, call us on 01243 216900 or email us at info@legalmatters.co.uk.

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Help with will writing or administration

Administering an estate when the Will creates a trust…

When someone dies leaving a Will that creates a Trust, it can have implications for the person dealing with the administration of the estate.

A Will may leave property or assets to a Trust so that an individual may benefit from them during their lifetime without actually owning them. For example, the deceased may have wanted their partner to be able to continue to live in their home, but might want it to pass eventually to children. Or they may want to leave money to children for their maintenance and education.

Estate administration and Will Trusts

The need to set up a Will Trust doesn’t alter the need for an executor to obtain probate. In some cases, where the assets fall below a certain threshold, probate might not be required.

Setting up a Will Trust

The executor is responsible for creating the Will Trust. They will ensure that assets are properly transferred to the trust and that the trustees named in the Will have access to them and are aware of their obligations under the terms of the Will.

Once the assets have been transferred, the trustees will be responsible for looking after them and distributing them to the beneficiaries as specified.

Types of Will Trust

A Life Interest Trust gives a beneficiary the right to benefit from an asset during their lifetime. This could include maintenance payments or living in a property. Once the beneficiary has died, the assets pass in accordance with the terms of the original Will.

A Discretionary Trust gives the trustees the right to distribute funds to named beneficiaries as they see fit. For example, there may be a request to fund education or provide a lump sum towards the purchase of a home.

Money held in Trust for a Minor will be looked after by the trustees until the child reaches the age specified in the Will. This doesn’t have to be 18 – it may be 21 or 25 or even older if the deceased wished.

A Nil Rate Band Trust may have been included in a Will as part of Inheritance Tax (IHT) planning. While it is no longer a requirement, older Wills may still contain this type of trust, which transfers assets amounting to the maximum sum the deceased could give under a Will without being liable for IHT.

Help with Will drafting and administration

Creating a valid Will that does exactly what you want and makes the best use of assets in the light of IHT and other considerations can be complicated.

Dealing with the administration of a Will and setting up of a Will Trust may also have tax implications. Obtaining professional advice means that you can be sure that assets are maximised.

To speak to one of our expert probate lawyers at legalmatters, call us on 01243 216900 or email us at info@legalmatters.co.uk.

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Funeral arrangements

Who has the legal right to organise a funeral?

A funeral is usually arranged by close family members of the deceased, but what happens if they disagree, or if someone else has the legal right to arrange the funeral?

If the deceased has left a valid Will, then the named Executors have the right to organise the funeral and either a burial or cremation. If there is no valid Will, then the Rules of Intestacy govern the appointment of an Administrator to deal with the deceased’s affairs, including funeral arrangements.

An Administrator will always be a family member, but it is possible that an Executor won’t be, for example if the deceased appointed a friend.

In that case, the Executor can choose to step aside and let the family arrange the funeral that they want.

When disagreements arise

If the Executor has different wishes to the family and a dispute arises, it is the Executor who has the right to make the arrangements.

If people have differing views on what should happen, it can be very upsetting at a time that is already difficult. The best way to proceed is to keep communicating and compromise if you can, to try as far as possible to avoid conflict.

If the parties involved cannot agree on funeral arrangements, then an application can be made to the Court, who may decide in favour of the legally appointed Executor or Administrator provided they have acted reasonably.

Where the disagreement is between two or more appointees, the Court will decide the matter on the facts. If the deceased has expressed any wishes in the Will, these are taken into account, although these wishes are not in themselves legally binding.

The importance of leaving a Will

Leaving a valid Will that includes an expression of funeral and burial or cremation wishes may help to avoid expensive and upsetting disagreements after death.

It is possible to request a professional Executor in a Will, such as a solicitor, who will act in accordance with the deceased’s wishes as far as possible. This can also help to avoid disagreement between relatives.

If an unmarried person dies without making a valid Will, then their partner can be left with no say in the funeral decisions as well as receiving nothing from the deceased’s estate, as the Rules of Intestacy do not include those not directly related.

A Will can be a record of what the deceased wants to happen after their death, as well as ensuring that their estate is distributed to chosen family and friends.

To speak to one of our expert probate solicitors, call legalmatters on 01243 216900 or email us at info@legalmatters.co.uk.

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Starting a family

Why you should make a Will when you start a family…

When you’re expecting a baby there’s a long list of things to do to get ready. Making a Will isn’t usually at the top of the list, and for many people it isn’t even something they think about at all. But in reality, it’s an important job that could seriously impact your family’s future.

Nobody wants to think about a situation in which children lose their parents, but covering every eventuality means that once you have children you can relax and enjoy life safe in the knowledge that you have drawn up plans for their future care should the worst happen.

When parents don’t make a Will

If anything happens to you and you haven’t made a Will, then those left behind will not necessarily know what your wishes were with regard to your children’s upbringing.

The authorities will have the right to place your children with the guardian they decide upon, and there could be a delay in finalising this, which could be even more unsettling for all involved.

Failing to plan and talk things over with family members could also cause disagreement between them.

As far as financial provision is concerned, this will be governed by the Rules of Intestacy, and you will have lost the opportunity to appoint your choice of trustees to look after the money you leave and decide how it should best be spent.

Writing your Will when you’re a parent

Writing a Will allows you to clearly set out who you would like to care for your children should you die. You can also make financial provision for your children, choosing the age at which you would like them to inherit any money you leave them. For example, you may decide that you don’t want them to be given a large sum of money at 18, and that you would prefer them to inherit it when they are older and more settled in life.

You will appoint trustees to administer the money until that time and leave instructions for how they can use it for your children as they grow up, for example a private education or money towards the purchase of a home.

The trustees will also be able to pay money to your children’s guardian, for everyday expenditure such as food, clothing and school expenses.

Appointing trustees

Choose people whom you trust implicitly and whom you believe are capable of carrying out your wishes as well as looking after the money that you leave. This fund will eventually be inherited by your children so it is important that it is properly managed.

If you would like to talk to one of our expert wills and trusts lawyers, call legalmatters on 01243 216900 or email us at info@legalmatters.co.uk.

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Client Testimonial

Client Testimonial…

When you lose someone you love it is always a difficult time. Having to deal with the paperwork involved in administering an estate after a death – and when you’re grieving – can be extremely upsetting.

That’s why at legalmatters we will always try to make the process as pain-free as possible for you – and why we’re always delighted to hear from a client when we’ve helped a family or an individual through such a stressful time. So thank you Jane for your kind words.

“Thank you and Megan, and all in the office staff for making my journey – sorting my dad’s estate through yourself and legalmatters – a professional, reassuring and stress free time. It’s been a pleasure and I would highly recommend you to friends.”

Choosing someone to act as your attorney

Signing a Lasting Power of Attorney (LPA) document authorises someone to deal with matters on your behalf, should you become unable to do so yourself.

There are two types of LPAs, one covering property and financial affairs and one covering health and welfare.

It is possible to ask your attorney to deal with your property and financial matters while you are still capable, for example if you have limited mobility and find it difficult to get to your bank. Your health and welfare matters can only be dealt with by your attorney once you can no longer make decisions for yourself.

You can choose to sign only one type of LPA if you wish.

Who should you appoint?

You should choose someone whom you trust implicitly, as they will potentially have a great deal of say over your life and financial affairs.

Your attorney needs to be aged 18 or over and in respect of a financial and property LPA you cannot appoint anyone who has been declared bankrupt or who is subject to a debt relief order.

If you do not feel that you have a family member or close friend who can act on your behalf, it is possible to appoint a professional such as a solicitor, who will charge a fee to deal with your affairs and who will be under a duty to act in your best interests.

Once your LPA is registered with the Office of the Public Guardian (OPG), your attorney will be supervised by them. This could include a visit to you or contact to ensure your attorney is acting effectively. After the first year it is likely that the supervision will be fairly minimal.

What your attorney needs to know

You should ensure that your attorney is happy to be appointed, and that they know what responsibilities this will entail. For example, they will be required to submit an annual report to the OPG explaining the reasoning behind the decisions they have made on your behalf and why they believe the decisions were in your best interests, as well as submitting financial details such as bank statements.

Give your attorney as much information up front as you can, letting them know what you will expect them to do for you and the scope of what they will be dealing with.

Let them think it through carefully and without pressure so that they can make the right decision. If they do choose to act, then discuss your wishes with them so that when the time comes, they will know how you would like them to proceed.

It is a good idea to have a second-choice attorney in place, in case your first-choice is unable or unwilling to act when you finally need them to.

If you would like to discuss appointing an attorney, call legalmatters on 01243 216900 or email us at info@legalmatters.co.uk.

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Life interest in your Will

Leaving someone a life interest in your Will

When making a Will, it is possible to leave someone a life interest in your property or assets.

It may be more prudent in certain circumstances to leave your spouse or partner a life interest in your assets rather than giving them outright ownership.

In particular this can be advantageous if you want to make sure any children you have receive something in the future.

Possible problems in leaving assets outright

Married couples often make duplicate Wills, leaving everything to each other and then after both their deaths, to their children.

The problem with this is that after the death of the first parent, unforeseen circumstances could mean that either the Will becomes invalid or the money in the estate is spent before it can be inherited.

For example, if the remaining parent remarries, any previous Will automatically becomes invalid. If the parent fails to make a new Will, their assets will pass under the Rules of Intestacy, with the majority of the estate going to the new spouse, who is then free to leave it elsewhere in their own Will. Even if they intend to honour an intention to pass the money to the children, it may be spent, for example on care home fees.

Similarly, if a new Will is written, any previous Will is superseded. This could mean that after the death of the first parent, the remaining parent is free to leave the whole estate elsewhere and not to the children.

Finally, if the remaining parent moves to a care home, then assets in the estate can be swallowed up in fees. At present the local authority will only step in to assist with payments when the patient’s total worth falls below £23,250.

How a life interest works

By leaving someone a life interest, you can be sure that ultimately your assets will pass to those you choose.

For example, you can leave your spouse a life interest in your home, which means they can live there as long as they want, but once they have died or left, your share will pass in accordance with your Will and cannot be given elsewhere.

This also prevents your share being used to pay their care home fees.

Similarly you can leave a life interest in other assets, including cash and shares. This allows your spouse access to money and interest for living expenses, but means that the money remaining after their death will go to your children, or whoever you have chosen.

If you would like to discuss whether leaving a life interest in your Will might be suitable for you, call legalmatters on 01243 216900 or email us at info@legalmatters.co.uk.

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Are you owed a refund after setting up a Lasting Power of Attorney?

Nearly two million people are due a refund after the Office of the Public Guardian (OPG) overcharged for registering a Lasting Power of Attorney (LPA).

An LPA gives someone the right to manage your affairs after you become incapable of doing so. You can execute an LPA in respect of your health and welfare and/or in respect of your property and financial affairs.

The Ministry of Justice has announced that the OPG overcharged those who registered an LPA between 1 April 2013 and 31 March 2017, and that they are entitled to a refund.

So far only 200,000 claims have been made out of 1.8 million who are qualified to do so.

Making a claim

Either a donor or an attorney can make the claim. They will need to supply the donor’s bank details, as the payment will be made to the donor. A copy of the LPA should also be included.

The claim form can be accessed via the government information page https://www.gov.uk/power-of-attorney-refund. In some cases, including where the donor does not have a bank account or the applicant is a court-appointed deputy, the claim will need to be made by phone by calling the helpline on 0300 456 0300, option 6. The deadline for claims is 1 February 2021.

How much will be refunded?

The amount of the refund will depend on when the LPA was registered, as fees paid differed over the time period in question.

Date Fee Paid                      Refund
April to Sept 2013                 £54
Oct 2013 to March 2014      £34
April 2014 to March 2015    £37
April 2015 to March 2016    £38
April 2016 to March 2017    £45

A claim can be made for each LPA registered. Interest will also be paid at a rate of 0.5 percent.

Who needs an LPA?

It is advisable for everyone to take the time to make an LPA, so that in the event they become unable to manage their affairs, either through illness, injury or incapacity, their chosen attorney can step in to help.

In the absence of an LPA, application would need to be made to the court, which could be an expensive and time-consuming process. This could also mean that you might not have your first choice of attorney acting for you.

You can execute an LPA, then keep it until such time as it is needed, at which point it is registered with the OPG.

If you would like to talk to one of our expert lawyers about drawing up an LPA, call legalmatters on 01243 216900 or email us at info@legalmatters.co.uk.

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