Peter Lee (Wills and Estate Planning) Limited

Q & A briefing – Matters to be considered when making a Will

Q & A briefing – Matters to be considered when making a Will – your questions answered

Making a Will is one of the most important steps you will ever take. It shows responsibility and care for your next of kin. Without a Will, your family will be subject to the law dictating to whom your assets pass and who will deal with your estate. There will be no special gifts, which may be very important to you, and no involvement of friends which may also be significant. Furthermore you may need to consider special family circumstances such as young children and the possible impact of inheritance tax. Don’t forget that if you die “intestate” (without a Will), your estate may not all pass to your spouse. There’s quite a lot to think about.
The following Questions and Answers are compiled from experience and for ease of reference appear under Will-related subject headings. They are addressed principally to the person making a Will for the first time.
If you have any questions which are not addressed in this briefing, just give me a call on 01302 521161 or 07788 718729 and I will be pleased to address them, without charge.

A. Perspective

Q1. Why should I make a Will?
A1. Because it means certainty, peace of mind for you and your family, and doesn’t leave your family to deal with the law and related uncertainties (or surprising outcomes) following your death.
Q2. Doesn’t my spouse or partner inherit everything anyway?
A2. The answer is “possibly” but it depends. It depends on the nature and extent of your family and the value of your assets. Refer on my website to the briefing “What’s it all about – Intestacy” where there is a table showing different entitlements in different circumstances. You will find that helpful in understanding what are called the “intestacy” rules which govern the entitlements to the assets of a person who dies without a Will.
Q3. How far ahead should I plan when making my Will?
A3. I generally advise clients to use a 3 year horizon. Life and circumstances change very quickly and you cannot anticipate all changes. Make a diary note to review the Will you make in 3 years.
Q4. Can I make a Will without instructing a professional? Can I do it myself?
A4. Yes and Yes, but I don’t recommend it. The point is that if you make a mistake in wording, don’t complete the Will in accordance with the law or make another mistake, the Will or parts of it may not be effective and when that is discovered, you may not be around to correct it. Most advisers charge modest amounts for completing a straightforward Will. Relatively speaking, it’s a small price to pay for peace of mind. Finally, I wouldn’t be tempted to choose the £25 or “Special Offer” variety, unless you know the reasons for it and believe them.

B. Your family and any other beneficiaries

Q1. What information do I need to get together in order to make a Will?
A1. Whoever prepares a Will for you will need details of your family and beneficiaries including full names, addresses, ages and relationships to you. Make a list.

C. Assets and liabilities

Q1. Will I need to explain to whoever makes my Will what I own and owe and related values?
Q2. Yes, but probably not in huge detail. Your adviser will need to understand the nature of your assets and their value for a number of reasons, for example, so he knows whether it is necessary to include special provisions in your Will or to advise you as to how those assets will be dealt with e.g. an interest in a business or jointly owned property. Identifying your assets will enable the adviser to possibly offer complimentary advice e.g. as to whether a life policy you have should be written “in trust”. The nature and value of your estate may lead to your needing some advice in connection with Inheritance Tax as to which, see Section H below.

D. Executors

Q1. What or who are executors?
A1. Executors are the people whom you appoint in your Will to deal with your assets and liabilities (often referred to as your “estate”) following your death. They are trusted by you to see the terms of your Will are carried out. They also have certain legal obligations.
Q2. Who can be executors?
A2. Any adult whether or not they are also beneficiaries under the terms of your Will.
Q3. How many executors can I appoint?
A3. Generally appoint no more than 4. Keep things simple. It is common to appoint one but to add what are called “reserve” executors. If you are married with children you might e.g. appoint your spouse or partner and appoint your children as “reserve” executors.
Q4. Can I appoint my Bank or Solicitor or another professional adviser as my executor?
A4. Yes and in certain circumstances I would recommend that, but it is essential that you understand the nature and cost of that appointment and its impact upon the family.
Q5. Should I tell the persons I choose to appoint as executors?
A5. Yes but you should ask them first if they are prepared to be your executors.

E. Guardians of infant children

Q1. What are guardians and can I appoint them?
A1. A complex topic but, if you have children they are the persons appointed to look after the interests of a child or children of yours until they reach the age of 18. A guardian accepting the role has a legal duty to look after the safety, health, care, education and up-bringing of your child or children. So it is important that you ask their permission and make them aware of your sentiments towards such matters as education, religion etc. You can appoint them if you have parental rights.
Q2. When would they take up the role?
A2. Generally on the death of you and the other parent of the child in question.

F. Special and specific gifts

Q1. What do I need to think about if I wish to make specific and cash gifts?
A1. At its simplest, what do you wish to leave, whether a specific item such as a painting or a cash sum and to whom do you wish to leave it. If to a beneficiary under 18, e.g. a grandchild, do you wish to specify the age at which they will be entitled to the gift, if reaching that age is a qualification, e.g. 21 or 25.
Q2. If Inheritance Tax is payable on my estate, who pays the tax on these special gifts?
A2. Providing there is enough money in your estate to apply some choices, you can specify that the beneficiary pays the tax on the gift, or they do not (in which case the beneficiaries of the residuary estate actually suffer the tax).

G. Residuary Estate

Q1. What is my “residuary” estate and what do I need to do to deal with that?
A1. Having addressed any special or specific gifts, what remains from your estate is called your “residuary” estate. You need to identify the beneficiary or beneficiaries and the shares of your residuary estate they will inherit e.g. all of it, or 25% each etc. You do need to consider if your gifts are to appear in “stages” e.g. you leave all of your residuary estate to your spouse or partner and if they don’t survive you then to your children and if they don’t survive you, your grandchildren or if none then to friends or other relatives or charities. These provisions need not be exhaustive but cover what you consider to be logical classifications of beneficiaries.

H. Inheritance Tax

Q1. How do I know if Inheritance Tax will be payable on my estate
A1. Whether Inheritance Tax is payable on your estate is dependent upon the value of your assets, the nature of them and the identity of the persons or organisations you leave them to. Sorry but it’s not simple. Perhaps the most important exemption is between married couples including civil partners. No Inheritance Tax is payable on the value of gifts passing between these couples, no matter what the value. Part of the process of making a Will should be to establish whether your estate is one upon which Inheritance Tax could be payable and if so how much and when. From there, consideration can be given to whether there are any steps which can be taken to reduce that burden.

I. Excluding people

Q1. What if I wish to exclude someone who might expect to be a beneficiary or to whom I have promised to benefit?
A1. This sometimes is the case. Sadly families do become distant or disputes can lead to some members being excluded from a Will. The law gives certain people the right to claim that a Will does not make “reasonable financial provision” for them. If you are wishing to exclude someone from your Will who might expect to be a beneficiary, perhaps e.g. because they have been financially dependent upon you, this needs to be discussed, as certain steps can be taken with a view to reducing the risk of such a claim arising.

J. Funeral arrangements

Q1. Should I specify my wishes in my Will?
A1. If you are clear about your preferences e.g. as to burial or cremation, or as to the religious nature of any funeral service, music or where you wish your ashes to be scattered, then these can be expressed in your Will. Often families don’t discuss these topics and to remain silent can present surviving family members with some anxiety following a death.

NEXT STEPS

So, quite a lot to think about, but hopefully you now know a little more of what is involved. You have taken the first important step. Now you can progress to complete making your Will, AND DON’T FORGET, all first meetings with me are free of charge and can be at your home or my office. Alternatively you may simply wish to ask an isolated question whilst you are contemplating the subject. If so, just call me on either of the numbers shown below.

Peter

Peter Lee
Director
Peter Lee (Wills and Estate Planning) Limited
Registered in England – Company number 9739979
Registered Office: 88 Stoops Lane Doncaster DN4 7RY
Telephone 01302 531161 or 07788 718729
E-mail: peter@peterlee-wep.co.uk
Website: http://www.peterlee-wep.co.uk

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