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Reasons to make a Will

Three reasons to make a Will

  • Planning Making a Will allows you to take stock of your property and plan how you would like it to devolve. You can appoint one or more executors to deal with the administration. You could set up a trust in your Will to ensure your assets pass down the generations, to protect them from creditors or irresponsible stewardship, or in second marriage situations. You may wish to make provision for charitable or philanthropic purposes.
  • Avoiding the rules of intestacy In the absence of a Will, your estate could devolve according to the English rules of intestacy. These may not deal in accordance with your wishes, so for example the assets of a person who is married or in a civil partnership do not automatically pass in full to the surviving spouse or partner. The rules of intestacy may lead to an unnecessary charge to tax. This may sometimes, but not invariably, be avoided after your death by a deed of variation. Even then, if young children are involved, this could involve great expense.
  • Saving tax It is no longer necessary for spouses to make specific provision for their nil rate bands (i.e. the part of the estate which passes free of tax), since any unused portion will be transferred to the survivor.

However, widow/ers in second marriages may be able to make use of three or even four nil rate bands, a tax saving of up to £260,000. The impact of the rules of intestacy may give rise to a charge to tax on the death of the first of two spouses or civil partners, which can be deferred or even avoided by making an appropriate Will. With an appropriate Will and careful planning, the value of real property for inheritance tax may be significantly reduced.

Five basic Will types

  • The Traditional Will For partners who wish their assets to pass to the survivor. On the second death, children will take all in equal shares. Children's entitlement may be made contingent on them attaining a given age (e.g. 21, 25 or 30).
  • The Flexible Will For partners who wish the survivor to have the right to the income of their estate. Capital may be distributed at the discretion of the trustees, but in principle will be preserved for children or other persons.
  • The Individual Will For persons who wish to distribute their estate between named individuals or charities.
  • The Discretionary Will For persons with complex affairs or wishes, who would prefer to leave their trustees with ultimate discretion. Your wishes may be recorded in a separate letter.
  • The Generational Will For persons who wish instead to skip a generation. Children or grandchildren will not take the property outright, but in trust.

Three potential complications

  • Domicile and citizenship issues If you hail from somewhere outside of the UK, your position may be complicated. For example the country of your domicile may not permit freedom of disposition, and certain jurisdictions, including the UK and the USA, have worldwide taxing regimes which attach to their citizens or domiciliaries, irrespective of their residence at death. With appropriate planning, your estate may escape the UK inheritance net entirely.
  • Foreign property If you own property outside the UK, community of property regimes, or rules of forced heirship or limitations on ownership may apply.
  • Second marriages Providing for two families in a tax efficient manner can create complications. In some circumstances, the nil rate band may be doubled or even tripled, and with careful use of flexible trusts, you may be able to make tax free provision for your children.

If one of our five basic Wills would suit you, please enquire as to our fixed price Wills. Alternatively, if you need a more bespoke service, we should be happy to advise you, and will quote for that service on application.

Additional information