Category Archives: Legal Matters

Bitcoins – are they properly covered in your Will?

Digital currency such as bitcoins are relatively new. However, they still form part of your estate when you die. They’re classed as “digital assets” similar to frequent flyer points or gaming credits. They might have dipped in value recently, but they are still worth money so you want to make sure they’re included in your will.

There are two key things to consider about this digital legacy.

The first thing relates to bitcoins being properly defined in your Will. If you already have a Will in place, you should check this. If they’re not covered, then you need to make an amendment. If you’re writing a new Will, then a professional Will-writer will be able to advise you on this from the start.

The other important factor to consider is how your beneficiaries are going to access your bitcoins. Passing on digital currency is more complex than passing on money stored in a traditional way such as a bank or savings account.

Bitcoins are stored in an encrypted electronic wallet which can be accessed only by an electronic key or password. Unlike banks and building societies, cryptocurrencies do not store names and addresses against the electronic wallets, so aside from the electronic key there is no way to identify who a wallet belongs to.

It’s vital then to make sure that you keep a secure copy of the key for your executors. Without it, it will be virtually impossible for them to access the wallet and the money will be lost.

You could consider entrusting the key with a secure storage service, in a safety deposit box or with your executor or a trusted family member. The main thing here is that it needs to be someone you trust as you are handing them access to your money.

For help with this or any aspect of Will writing, please give us a call at legalmatters on 01243 216900 or email us at info@legalmatters.co.uk for further details.

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Could you be a royal legacy?

Most of us at some point have probably wondered about our family history. Sure, you may know about your grandparents’ roots and perhaps even a generation or two before that, but where does your family line start?

What sort of riches or scandal have your ancestors seen? It’s because of this curiosity about our family histories that shows like ‘Who Do You Think You Are?’ have become so popular, as have websites helping you to trace your family tree.

So could you have royal blood? According to a study from researchers at the University of California and the London School of Economics, your last name could be a good indicator of whether you are one of the top 1%.

The study looked at unique surnames among the richest – names like Atthill, Bunduck, Balfour, Bramston, Cheslyn, and Conyngham – and found that when it comes to social mobility, moving in and out of the upper classes takes centuries, not just generations.

In fact, on average upper-class families took between 300 and 450 years before their descendants dropped into the middle classes.

Fascinatingly, of the people who died between 1999 and 2012, if they had one of the 181 rare surnames of wealthy families in the mid-19th century, they were generally three times wealthier than the rest.

Whether you come from generations of wealth or are completely self-made, it is vital that you take steps early on to ensure that you pass it on to your family members as seamlessly as possible.

That may mean considering your likely inheritance tax liabilities, but you will also need to write a Will.

After all, writing a Will is the best possible tool at your disposal to ensure that your assets are divided precisely as you wish after you pass away. If you don’t, you may be exposing your family to unnecessary heartache at an already difficult time.

For help and advice on writing your Will, get in touch with us at legalmatters by calling us on 01243 216900 or emailing us at info@legalmatters.co.uk for further details.

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What can legacy giving do for your tax bill?

Who are you going to leave money to in your Will? Your spouse or partner is probably first in line, any children or extended members of the family may pop up here and there too.

But what about charity?

Thousands of people every year choose to leave a gift to charity in their Will, whether it’s a fixed amount, a fixed percentage of their estate or even just what’s left after other gifts have been handed out to their surviving loved ones.

It doesn’t have to be a charity that you’ve been particularly involved with during your life either – you can leave money to any registered charity.

There’s another bonus to doing this, besides simply helping a good cause. Legacy giving – where you leave money to a charity – can also reduce your inheritance tax bill.

With inheritance tax, you – or rather your estate – is charged a rate of 40% on every £1 that the estate is valued above the nil rate threshold, which currently stands at £325,000 (though couples essentially enjoy a £650,000 threshold).

However, when you leave money to charity, it won’t count towards the value of the rest of your estate, giving you the opportunity to reduce the value of your estate below that threshold, ensuring no further tax is payable.

Even if your estate is still valued about the threshold, charitable giving can help reduce your tax bill. If you leave 10% of your net estate to charity, then the inheritance tax charged on the remainder of your estate falls from 40% to 36%, a reduction which could see the estate save thousands of pounds in tax.

Many of us regularly give to charitable causes while we’re alive. To do so after your death will not only help support good causes with some of your estate, but for your beneficiaries there are tax benefits that can come with it. Obviously, you should discuss this carefully with your loved ones and your will writer when drafting your Will.

It’s important for you to be clear when drawing up legal documents. Legalmatters can help, we’re always happy to discuss your needs or answer your questions. Call us today on 01243 216900 or email us at info@legalmatters.co.uk for further details.

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Do you need a living Will?

A living Will (or an advance decision as it is also known) allows you to make a decision about refusing medical treatment in the future. It means that if you are ever in a position where you cannot communicate your wishes, medical staff know what they are. This can even include a decision not to receive certain life-sustaining treatment.

An advance decision is a legally binding document. However, if your family or medical staff are unaware you have prepared one, then your wishes may not be honoured.

This was the case for Brenda Grant. Brenda suffered a stroke in 2012 and although she had prepared an advance decision stating that she did not want certain treatments, she was fed artificially for two years.

In this case the hospital was in possession of the advance decision but had misplaced it.

Whilst Brenda had informed her doctor of her decision, she had not told her family, so it was only when her doctor flagged it up two years later that her wishes were finally respected.

If she had chosen to prepare a lasting power of attorney (LPA) instead, this situation could have been avoided.

An LPA for health and welfare covers a wide range of issues relating to the care of an individual if they don’t have the capacity to make decisions for themselves.

Though it is a legal document just like the living Will, it must be lodged with the Office of the Public Guardian in order for it to be recognised. This ensures that it will be recorded on a national and searchable register. One or more attorneys (normally family members) must be appointed to make the decisions, so in the event of you not being able to make them yourself, there is less risk that your wishes will not be known.

An attorney must make decisions that are in the best interest of the donor (the person who the LPA relates to). The donor can detail what their preferences are and list any instructions for specific circumstances.

Whilst it is possible to have both a living Will and an LPA for health and welfare set up, the latter will take precedence should a conflict arise.

At legalmatters we’re always happy to discuss our clients’ needs and to answer their questions. Call us today on 01243 216900 or email us at info@legalmatters.co.uk.

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Writing a business LPA…

The use of the Lasting Power of Attorney (LPA) – where an ‘attorney’ is appointed to make certain decisions on your behalf should you reach the point where you are unable to make them yourself – has increased significantly in recent years.

However, it would be a mistake to view LPAs as purely a tool for individual use. A business or commercial LPA can prove just as useful if you happen to own your own business.

What would happen if you were injured or fell seriously ill? It may be that you have company documents such as a partnership deed or shareholders agreement to say who would take over the running of the company but who makes shareholder decisions i.e. who would be in charge of those strategic decisions on which the future of the business will depend?

While there may be some form of informal understanding among you and your senior team of who would take on that responsibility that may not be enough if you are also a shareholder in a business. Without some form of legal structure in place, there may be issues with them accessing the business’s bank accounts, arranging contracts with suppliers, even paying the salaries of the existing staff. It may not take long for the company to end up in serious difficulties.

Writing a business LPA is an excellent way to tackle this, ensuring that an appointed attorney is in place to step in and maintain continuity should you no longer be able to fill that role.

Picking a suitable attorney for a business LPA is not altogether different to selecting one for a personal LPA. You need to find someone who you trust, who is reliable and who has a similar outlook and attitude towards the business as you. It’s vital that you talk this responsibility through with them in advance though, so they are well aware of what will be expected of them should you fall ill or be involved in an accident.

As with a personal LPA, you can appoint more than one attorney, and specify that they act together in certain areas but separately in others.

Successful business owners pride themselves on being prepared for all situations, and sadly ill health is an important one to consider. Without making it clear legally that one of your team can step in and make important business decisions on your behalf, if you are no longer able to, it can put the very future of the firm in danger. Having a business LPA in place is vital.

To find out more about LPAs, contact legalmatters. Call us on 01243 216900 or email us at info@legalmatters.co.uk to discuss your particular situation.

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Celebrities we loved but lost in 2017…

So why was 2017 such a good year for the Grim Reaper when it comes to celebrities?

Experts have come up with a few reasons. Thanks to the proliferation of media over the past few decades, there are more stars around these days and more claiming fame faster.

Social media plays an important role in this process. As well as creating new stars, it also means that we hear about celebrity deaths far faster than in the past, as well as providing everyone with a platform to publicly share their grief. In fact, in the early part of the 20th Century, before television, the only celebrities were film stars.

We said goodbye to some of the best:

  • The legendary Bruce Forsyth
  • Socialite and television presenter Tara Palmer-Tomkinson
  • We lost a Bond; Roger Moore
  • Rock ‘n’ roll legend Chuck Berry
  • Star musician of the band Linkin Park, Chester Bennington
  • Michael Bond, writer of the Paddington Bear books
  • Peter Sallis, the voice of Wallace in the Oscar-winning animated hit Wallace and Gromit and “Cleggy”

The question is, did these celebrities make plans for their assets to go where they wanted them to?

2017 was the year that reminded us that death is inevitable, regardless of how rich and famous we are. It also reminded us of the importance of writing a will.

Contact us at legalmatters to get your estate in order – even if it’s not of A-list proportions it’s still important! Call us on 01243 216900 or email us at info@legalmatters.co.uk.

Will water cremation become a reality in the UK?

Water cremation is already offered as a service in several US states, but has yet to receive approval in the UK. Will it become an alternative to traditional cremation in the UK?

Before you consider it as an option, you need to know what it involves…

The Water Cremation method involves a body being placed into a metal chamber, where a process called alkaline hydrolysis breaks the body down into liquid and ash.

Many proponents of water cremation claim that the process is environmentally friendly, with there being no human DNA in the waste water produced. The process is supposedly kinder to the environment than traditional cremation. Companies looking to offer the service here in the UK claim that the process produces less than two thirds of the greenhouse gas emissions and requires just a seventh of the energy used during the cremation.

The process used for Water Cremation also allows for bodily implants to be completely separated along with dental amalgam. This means that mercury (found in tooth fillings) can be removed safely. If the Water Cremation service was offered in the UK, and it proved popular, this would help to reduce the UKs airborne mercury emissions. It is thought that currently approximately 16 percent of such omissions originate from cremation.

Although this sounds positive, there have been some objections. Sandwell Council have been awarded planning permission to enable them to offer this service (through a partner company). Severn Trent Water have however refused the Council a trade effluent permit, which has stalled the process.

Severn Trent Water say they are currently looking to the government for guidance. Water UK has also stated they are “not convinced”, with a spokesperson telling The Sunday Times: “It is the liquefied remains of the dead going into the water system. We don’t think the public will like the idea.”

The Council’s reasoning for wanting to offer the service is that they would like to provide more choice for the public, giving them greater control over what happens to them after they die.

While water cremation may not currently be an option, it could be a reality in the UK in the very near future. The popularity of any future water cremation service remains to be seen.

Whilst you may not want to think about it, it’s important to plan for your future. Whatever your wishes, it’s important to consolidate them in one place.

Having worked in estate planning for many years, legalmatters are experts in the industry. As well as advising you on providing for your loved ones, our professional team can ease any worries you may have. Speak to legalmatters today to make sure that your final wishes are carried out. Call us on 01243 216900 or email us at info@legalmatters.co.uk.

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Grandparents and gifting options…

Many grandparents are intending to gift their grandchildren financially, with recent research from Saga suggesting that more than £37bn has passed from grandparents to their grandchildren.

Part of this is down to the fact that older people are worried about their grandchildren’s future. The increase in cost of houses, cars and the day to day necessities mean they’re likely to suffer financially and be much worse off than those of generations gone by.

So how could you go about helping out your younger relatives?

Skipping a generation

According to the research, around 14% of parents are skipping a generation and are instead looking to leave assets to their grandchildren.

Making use of a gift allowance

In certain scenarios, grandparents are choosing to give money without causing a tax event such as a £3,000 annual gift allowance. This can cover financial gifts which can be passed over each year, free of Inheritance Tax. Additionally, grandparents can also give away up to £250 to any number of people each year.

Putting it in a trust

With a discretionary trust, it is up to the trustees to determine how and when any potential beneficiaries may be able to access the cash. You can appoint yourself as the trustee, so that you have final say over where the money goes, or you can go for an independent trustee. What’s more, the money within the trust is classed as separate from your estate, so it’s free of Inheritance Tax.

There are also bare trusts, which mean the grandchildren would be completely entitled to whatever is in the trust once they reach 18. Unlike the discretionary trust, the beneficiaries are fixed, so once the trust is declared it is not possible to add (or remove) beneficiaries.

It’s important that you consider where and to whom you want your assets to go to – a comprehensive will is the only place where you can formally set this out.

Don’t keep putting it off. Speak to legalmatters today to make sure that your final wishes are carried out. Call us on 01243 216900 or email us at info@legalmatters.co.uk

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Importance of business succession planning…

You’ve spent years building up your business, but have you given any thought to what will happen when you die?

Do you have an exit plan, and if not, how do you go about building one?

First of all you must decide what you want to happen.

Do you want it to be sold? If that’s your goal then how do you make it as healthy and profitable as possible to get the best price when the time comes to sell?

If you have children, do you want them to take over your business, are they able to and do they want to? If you have more than one child, do you want all your children involved; should they own it and someone else manage it?

If you are handing the business on, then you still want it to be in good shape but you also need to think about who will take it over, what training they might need and whether you need to mentor them.

It’s obviously very important to have a Will in place which will detail how you want the business to be passed on and to protect it from inheritance tax. Your business assets may qualify for relief from inheritance tax or there may be things that you can do to reduce the impact of the tax.

For instance, did you know that business relief for inheritance tax reduces the value of a business or its assets for inheritance tax purposes when you die?

The proceeds could one day become taxable for your beneficiaries, so it may well be wise to establish a Business Property Relief Trust which will ensure that the relief is protected.

If you’d rather your family receive money than the responsibility of taking over your company, then have you considered a share purchase agreement? This allows surviving business owners to buy your shares when you die.

To find out more about the different approaches to ensuring your business is protected for your beneficiaries, contact legalmatters. Call us on 01243 216900 or email us at info@legalmatters.co.uk to discuss your particular situation.

Help! I’ve been asked to be an Attorney!

The number of people making use of Lasting Power of Attorney (LPA) agreements has increased enormously in recent years. In fact, according to data from a Freedom of Information request, the number of LPAs has increased threefold since 2010.

This is undoubtedly a good thing; LPAs allow you (the “donor”) to nominate an “attorney” – perhaps a relative, a friend, a professional (for example a solicitor), your husband/wife/partner – to step in and make decisions on your behalf should you no longer be able to do so.

According to the Alzheimer’s Society there are currently 850,000 people in the UK living with dementia, and that’s expected to pass the million mark by 2025. As a result, an LPA is an excellent piece of planning, ensuring that someone you trust will be making decisions in your best interest should the need arise.

But what about the people that are asked to be an attorney? What does it mean for them?

  • It’s a significant responsibility, so generally people are advised to select good friends or close relatives to be their attorney.
  • As there may be a lot of administration involved – such as sorting out a care home, paying the care fees and keeping up to date records of the donor’s affairs – they need to be reliable.
  • At all times, the attorney will be expected to act in the best interests of the donor, acting in accordance with the terms of the LPA.
  • What’s more, the attorney cannot ask anyone else to take over their duties unless the donor has authorised them to do so.
  • All of this will be unpaid, although the attorney will be able to claim reasonable expenses.

For anyone who’s been asked to be an attorney but believes that it may be too much for them, it’s important to speak to the donor in advance of the LPA being registered, when it would be too late.

LPAs can give donors peace of mind that someone they trust is making decisions on their behalf. However, selecting the right attorney may be more complicated than it first appears, and it’s vital that attorneys are clear on their responsibilities before taking on the role.

For help preparing an LPA – or to discuss the responsibilities of an attorney – call legalmatters on 01243 216900 or email us at info@legalmatters.co.uk.