Wills, and what you need to know
1. Why should I make a Will?
A Will permits you to do many things that would not be possible if you were to die intestate (without a Will). This includes specifying the person(s) who will administer your estate, giving direction to your executors as to what is to happen to specific assets, achieving desired tax and estate planning objectives, protecting your assets from being used to pay for Long Term Care fees and indicating who should be the custodians of your young children.
2. What happens if I die without a Will?
Dying without a Will (intestate) has various consequences. The cost of administering your estate will be higher, and the person who is given authority to administer your assets will not necessarily be someone you would have chosen. The distribution of your estate is fixed by law, irrespective of your intentions to include or exclude individuals, with all amounts paid out to heirs as soon as they turn 18 years of age (rather than another age of your choosing). In the meantime, trustees are limited in the scope of the investments they can choose to make on behalf of minors, with the Children’s Lawyer, a government appointee, administering the share for a child. If you have children your spouse may not inherit everything.
3. Can I make my own Will?New Paragraph
In England and Wales you can write your own Will, but there are many traps for the unsuspecting person which could result in estate assets not passing to your chosen beneficiaries, either because key Will provisions are invalid, or because the person’s choice of words runs foul of some legal rule or principle. The best advice is to rely on a professional Will writer to take your instructions and translate them into legally effective provisions in your Will.
4. I’m not married but live with a partner – what happens to my estate?
If you are not married to your partner, he/she will not be able to keep anything that belongs to you. All of your assets will be distributed according to your legally-recognised next of kin, which could run contrary to your wishes.
5. Doesn’t my spouse get everything when I die anyway?
If you were to die intestate (without a Will) the law determines who gets your assets and how much. These rules say that your spouse, if you have children, gets only the first £250,000, including the value of your house (if the house is worth more than £125,000 this may have to be sold). Beyond that, things become more complicated.
6. Do I need to worry about taxes on my death?
If your assets total more than £325,000 – including your house - your beneficiaries will be liable to pay 40% on everything over this amount. You should talk to a professional experienced in tax and estate planning who can give you good advice in minimising exposure to this tax on your death, whether through your Will or by taking appropriate steps during your lifetime. It is possible to save thousands of pounds through simple measures.
7. I already have a Will. How often should it be reviewed?
It is important to review your Will whenever there have been changes in family circumstances (for example, births, deaths, disabilities, marriages, separation or divorce) or if there has been a significant change in your wealth, whether an increase or a decrease. But even if no such changes have occurred, there may be changes in income tax or other laws in the interim.
8. I was divorced recently, but how do I ensure that my ex-spouse does not receive anything under my Will?
Divorce automatically revokes gifts to a former spouse and removes that person as an Executor if he or she was so appointed, unless the Will provided otherwise. However, if the scheme of distribution in your Will indicates gifts to your ex-spouse, chances are that other changes will be needed and you should therefore not rely on the ‘revocation’ rule. Furthermore, unless you make a new Will, your executor will be obliged to notify your ex-spouse that an application for Probate has been submitted to the court, and your former spouse may participate in the proceedings. They may argue that your Will suggests that they should still receive bequests under the Will.
9. My spouse and I have separated – do I need to change my Will?
Separation does not affect your Will - even if you have a Separation Agreement, which provides that your spouse will have no claim against you under your Will. Making a Will is a matter that should be attended to immediately upon separation. However, your spouse may still have a claim against you under the relevant marital property laws.