Estate planning and Inheritance Tax
18th July 2023
It’s never too early to plan for what happens to your estate after your death. Many people put off such morbid thoughts but leaving no instructions for your spouse and family on how to deal with your assets after you are gone, can put added stress on an already difficult situation.
Things to consider for estate planning
We have set out some key points to consider when planning your estate:
- Have you written a will?
- Who will carry out your instructions?
- Do you want a funeral, cremation or memorial service?
- Who will look after your children (or your pets)?
- Are you aware that there is no such thing as a common law spouse for Inheritance Tax purposes?
- Marriage invalidates a will, but what about divorce?
- Are you regularly reviewing your will for any changes?
Writing your will
The best way to make sure your assets end up where you want them, is to write a will. While it is possible to write one yourself (and arrange for two independent people to witness your signature), we would always recommend using a solicitor, to ensure it is legally valid, and achieves your wishes.
Your executors are responsible for collecting your assets, paying your debts, and distributing your estate to your beneficiaries. Choose people who you trust will carry out your instructions. One of their first acts is to arrange your funeral or cremation, so including your wishes in your will is very important.
If you have young children, and both you and your spouse pass away at the same time, you should include instructions in your will for who will act as their guardian. The same could apply to any beloved pets.
What happens if there is no will?
Passing away without a will is called dying ‘intestate’. The law provides for the distribution of assets, with strict rules on who gets how much. Remember, there is no such thing as a common law spouse for inheritance rules, so an unmarried partner may not receive anything if you die without leaving a will. It is therefore arguably more important for unmarried couples to write a will.
Once you have written your will, it is important to review it regularly to make sure it is still appropriate to your circumstances. Your will becomes invalid if you subsequently get married – this is therefore a good opportunity to review your plans. Getting divorced does not invalidate a will, but the divorced spouse is removed from benefitting from the will and from their position as an executor, if appropriate.
If you would like to us to review your will or to discuss any aspect of planning your estate, please contact Mark Pattenden, Partner.
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