Tax and Estate Planning

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What happens to your assets on your death?

With a Will
If you have made a valid Will it will be operative from your death. However it is important that you review your Will on a fairly regular basis for the following reasons:

	The personal circumstances of yourself and your family may have changed so that your Will may no longer reflect your wishes.
	Your financial position may have changed so that your estate may be liable to Inheritance Tax. Anyone holding assets to a value of more than £285,000 (being the present nil rate band allowance) needs professional advice in order to avoid Inheritance Tax. In the case of modest estates, very often this can be achieved simply by putting into place a 'tax-efficient' Will.

Without a Will
It is a common misconception that your estate passes to a husband, wife or civil partner if there is no Will. This is not the case. Your assets will transfer in accordance with the intestacy rules. These rules are unfortunately out of date and in urgent need of reform. Under the rules (depending upon the size of the estate) your assets will be shared between your spouse or civil partner and your children. If you have no children the assets will be shared amongst your spouse or civil partner and your parents, brothers and sisters. It is unlikely that the rules will reflect your actual wishes. It is a disturbing statistic that the majority of people do not make Wills. People take immense care to build up assets over a lifetime but fail to ensure that they are safely delivered on death to their loved ones. The absence of a well drafted Will at worst will deprive your loved ones of part of their 'inheritance' and at best will give them considerable anxiety during a sad and difficult period in their lives.

If you have a partner to whom you are not married or is not your registered civil partner he/she will have no entitlement under the intestacy rules

Marriage or re-marriage or Civil Partner
Marriage, re-marriage or the formation of a Civil Partnership automatically revokes a Will unless it is stated to be made in contemplation of the marriage or civil partnership. Prudently you should make a new Will when you become engaged. It is crucially important to make one following your marriage or Civil Partnership.

Separation
If you become separated from your partner, spouse or Civil Partner, you should make a new Will to ensure that your partner, spouse or Civil Partner does not inherit your estate. However, great care needs to be taken in the preparation of the new Will to avoid any risk of the seperated spouse or civil partner making a claim against your estate in the event of your death. We can help you with this and usually recommend the device of a flexible Will Trust. We will be happy to explain the strategy in detail to you.

Divorce or Dissolution of Civil Partnership
It is important to realise that divorce or the dissolution of Civil Partnership can result in the revocation of some parts of your Will. However, if we have dealt with your divorce or dissolution, you will by that time have been advised to make a new Will.

Children's inheritance
Clients frequently express concern that their children may lose out on their inheritance if their spouse remarries or Civil Partner forms another Civil Partnership following their death. This concern can be successfully addressed through the use of flexible Will Trusts. We will be happy to explain the strategy to you.