What Is A Will?
A Will is a legal document that can ensure that your estate passes, in a tax efficient manner, to those you wish to benefit.
This could include making gifts to friends, family members, dependants or for charitable or philanthropic purposes.
What if I don’t have a valid Will on death?
Without a Will, your estate may be divided in accordance with intestacy rules. However, the impact of the intestacy rules may be in contrast to your own wishes and could result in those who you had wanted to benefit from your estate being left without on your death.
For example, if you are not married or in a civil partnership and do not make a Will, under the intestacy rules, your partner would not inherit any of your estate. This is irrespective of whether you to live together.
A further example of the intestacy rules leading to family members not being left anything from estates are stepchildren. The intestacy rules only account for biological children and therefore a step-child will not be included as a beneficiary of the estate of someone who dies without a Will.
What if I have an outdated Will on death?
If you have an old Will, your estate will pass under the terms of it, which could result in your estate potentially passing to individuals whom you may not want inheriting your wealth.
The impact of not having a valid and up to date Will is that it could also lead to tax being payable that could have been minimised with proper estate planning.
If you already have a Will, it is recommended that you keep this under review periodically to ensure that it matches any changes in your circumstances, wishes or changes in the law. The typical circumstances that should lead to you reviewing your Will include if you were to marry, divorce, have a child or have a change in your wealth.
Claims on Your Estate
A claim can be made against someone’s estate after they have died. These types of claims continue to increase year on year and so it is crucial to ensure you have a Will drafted so that your wishes are clearly documented.
What type of decisions can be included within a Will?
Your Will would typically cover multiple points, including:
Executors are appointed in your Will to administer your estate. An executor should be someone you trust and can be a friend, family member or professional advisor.
Guardians can be appointed within your Will. Guardians take the legal responsibility for any children under the age of 18 if both parents have died.
Legacies, or a legacy, is the formal term for gifts which are included within a Will. You could choose to gift money, property or specific items within a Will and these gifts my be outright or they may have conditions attached. For example, you may choose for someone to only inherit the gift at a specific age.
Trusts can be used as an alternative way of holding, protecting, preserving and generating wealth. There are various types of trusts that can be included in your Will depending on your circumstances and wishes.
In short, a trust is a legal structure which puts an asset under the control of a trustee or trustees, for a beneficiary or beneficiaries Trusts can be used to allow assets to be held for those who cannot hold the assets directly themselves. This may be because the beneficiary is a minor, lacks mental capacity or there is a risk of a claim being brought against the beneficiary for the asset, for example if the beneficiary is to be divorced or there is a significant risk of divorce in the future.
Residue of your Estate
The residue of your estate is the remainder of your estate and it is what is left after any debts, expenses, taxes and legacies have been taken out. The residue can be directed to a beneficiary, beneficiaries or a trust, depending on your wishes.
How do I create a Will?
In order to ensure that your Will is valid, to reduce the chance of claims against your estate, and to ensure that your personal circumstances are taken into account we strongly advise instructing a legal professional to work together with you when drafting your Will. We will provide expert advice in relation to what you wish to include in your Will, how you want your assets to be dealt with and any tax issues which may arise. A Will would then be drafted for your consideration.
Upon your approval of the draft Will, arrangements would then be made for the final Will to be signed and witnessed. Thee are strict requirements for the execution of Wills and we can advise on the procedure to ensure this is followed.
Get in Touch
Whether your financial position and wishes are simple or complex, our team have experience with all sizes and manner of estates and can prepare Wills that are tax efficient and tailored to your specific needs.
Should you have any queries in relation to any of the points mentioned within this update, please do not hesitate to get in touch with Daniel Wilson.
You can also find out more about our EMW Wealth team here.
The information contained in this update is for general information purposes only and is not legal advice, which will depend on your specific circumstances.