Inheritance rules explained, well sort of…

General, Wills

Inheritance rules explained, well sort of…

Why are inheritance rules so complicated?

Passing on what you have got ‘at the date of death’ is a complex problem. What everyone wants is some appreciation of how the rules work. One way to describe it is like cracking the family’s safe and finding a real mix of things inside to deal with. If you’ve got some know-how, you will be far more successful at opening and handling what’s inside.

Where do I start?

Understanding what you own and how you own it (like a house), or it could be that you are allowed to use it by a trust or a limited company, for instance is vital. This is why I always encourage every single client to write down what they have in a paper booklet called ‘My Documents, what I own and where it is kept’

What other factors do I need to consider?

Crickey! There are a lot of factors to consider, think of it like a jigsaw puzzle, complete the picture and you will understand where I’m coming from!

Your marital status, family in other words, we need to draw your family tree and understand the dynamic of it. Complicated is far more common these days than straightforward, honest! Are you getting married or are you separating and don’t want to provide for your exiting spouse? Can you actually dis-inherit a wayward child, and if so, what are the consequences?

Your health and ability to explain what you want to happen, and the health of your intended beneficiaries will have a bearing on how you should provide for them.

Knowing what you want to happen is fundamental, how you best achieve it taking into account the law and taxes is quite another. That’s where we come in, we can guide you through the maze and explain why we recommend certain options. Think inheritance tax rules, do you have assets abroad, what about your shares in the family company?

Some of us may have been provided for in someone elses Will but we haven’t been given anything outright, like a life interest (or a term interest, say for 5 years) to benefit during that period but when this comes to an end, the asset (property or money) goes to someone else. This will affect your estate for tax purposes.

All this said, the reason we are all interested in this topic, is to make sure (in your eyes) only the right people benefit and it is our duty to minimise what the Government takes in taxes.

The right people then are important and as you won’t be around to sort things out, your choice of executor(s) will be key, they’ll sort out the money-side, your appointment of guardians will sort out who your children are to live with, don’t forget the children! Don’t forget you can choose (within reason) what age your children will inherit from you. We learnt an important message about choosing guardians for our children, asking them their views is a good idea.

Do you have set ideas about who is going to get that expensive piece of jewellery, family heirloom or is it the Aston Martin? I wish… Making promises you don’t intend to keep can lead to tears and a contentious claim by those who feel they have been short-changed.

What’s your best option then?

Knowledge is one thing, you could read a book! Experience and an all-rounded perspective is another which is why there are specialists out there like us. It ain’t an easy job! What is certain, is to take your time with this before settling on a plan, then get professional help in.

All members of the IPW, the Institute of Professional Will-writers are trained and qualified to help, check credentials, check costs, ask others who they have used, Google around and look at some websites, do your research in other words, and find someone you trust to help out.

Face-to-face appointments work best but the next best thing in these Covid-times is online video conferencing and the good old-fashioned Royal Mail. Let’s all stay as safe as possible and embrace a bit of technology, we’re happy to help and extend a warm welcome to you if you think we can help you out. All the best.

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