Does my Will cover my assets abroad?

Now that the world is beginning to ‘open up’ again and travel is becoming easier with restrictions lifting, it is worth considering your assets and whether these are held within England and Wales, or whether you have any abroad.

If you do have assets abroad – property, bank accounts, investments, anything at all – are these covered under your English Will or do you need to make a Will specifically to cover those assets?

There is nothing that legally prevents you from having a Will in England & Wales that covers all of your assets worldwide, HOWEVER…

It may be worth considering exactly where your assets are held and obtaining legal advice for the country and jurisdiction that those assets are held to ensure there are no issues in the future.

The laws of England & Wales are very different jurisdictions to those of European Countries, for example, and the laws in European Countries do not recognise the use of Trusts…this could have major tax implications if you are relying on a Will made under the laws of England & Wales that utilises Trusts,

In addition, some things are just not possible in foreign jurisdictions, in the way they are under the laws of England & Wales. We are fortunate in England & Wales to have the autonomy to decide (if we are of sound mind) who we want to leave our assets to and who we want to inherit, or who we choose to exclude from our inheritance. Other Countries, including some European Countries (such as Spain and Italy), are not so fortunate and have legislation that sets out who must inherit and who cannot be excluded from a Will or inheritance.

If your Will made under the laws of England & Wales does not meet the criteria for the jurisdiction in which your assets are held then, it could be invalid.

So, whilst it may seem much easier to have one document, containing all your instructions for all of your assets wherever they are in the world; this may not be possible and may not give you the best protection (not to mention the best financially-sound solution) possible.

If you have assets overseas, we would recommend seeking the advice of a legal professional in that country. The legal professional will be able to advise as to what will happen on your death and the best way of protecting your assets for those that you want to inherit.

Just a note as a reminder; where you do have assets in more than one country and are making multiple Wills, it is important to ensure that all of the professionals that you seek advice from are aware of this and so do not inadvertently revoke (or cancel out!) any of the work being done in another country or by another professional.

In our experience, it is advisable to have a separate Will in each country that you own assets in. This means that you can take advantage of legal advice from professionals that are experienced in that specific jurisdiction and with what options are available to you and your assets.

If you would like to have a free chat about your existing Will or making a new Will, please contact us on info@TotalLegacyCare.co.uk or 01727 865 121

Leah Waller

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4th August 20224th August 2022

Our property is in my sole name, will my partner / spouse be homeless when I die?

Our property is in my sole name, will my partner / spouse be homeless when I die?

Here, I am only going to be looking at properties where the surviving spouse or partner does NOT own the property.

I will not be delving into any Inheritance Tax matters or into any detail where a property is held as Joint Tenants – please check out our other articles for more information on these scenarios.

If you are living in a property with a spouse or loved one but the property is in only one sole name, the scenario where the surviving partner or loved one is left homeless could become very real…

Of course, if you are leaving the property to your spouse or partner in your Will, then there is no need to worry.

HOWEVER, if you are not married to your partner, or have children from a previous relationship (or many other scenarios!) you may want to leave your property to your children or someone else.

So, what happens to your partner - do they have to move out?

Ultimately, this will depend on the beneficiaries that you have left the property to and what they want to do with the property. They may decide they are happy for your partner to live there but want them to pay rent so that they can benefit from an income, or they may want to sell the property to release their inheritance immediately, or rent it on the open-market to try and obtain a higher income.

So, is there anything you can do to ensure your surviving partner isn’t left without a roof over their head, but your property still goes to those you want to inherit in the end?

Of course, I have an option for you!

LIFE INTEREST TRUSTS

A Life Interest Trust sounds a lot more complicated than it is, so let me set out the basics for you…

A Life Interest Trust allows the property owner (it doesn’t just have to be property, but let’s use this as the example), to pass the property to whoever they want to ultimately inherit the property but allows them to name someone (their partner, for example) to live in that property, free of charge, and benefit from the property until their death.

We could also look at including other stipulations like, not allowing the surviving partner to cohabit in the property with a new partner, or ensuring that the surviving partner could not live there if they remarried.

A Life Interest Trust is something that we would set up in a Will and only comes into effect upon the death of the property owner.

This may also be something that you would like to consider where you both own the property but each wants to leave your share of the property to different beneficiaries (perhaps children from a previous marriage or your own nieces/nephews).

Life Interest Trusts have many advantages but should be considered in detail before just being put in place.

Life Interest Trusts cannot be used where the property is held as Joint Tenants, as the property automatically passes to the surviving owner upon the first death. Again, this is something that we can consider and discuss as to whether it is advantageous to you, to change the way in which you hold the property (to Tenants in Common), and put a Life Interest Trust in place.

If you would like to have a FREE chat about your property and protecting your loved ones, please contact us on info@TotalLegacyCare.co.uk or 01727 865 121

Leah Waller

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7th July 20227th July 2022

Where do I look for a Will when someone dies?

Where do I look for a Will when someone dies?

Looking for a Will is unlikely to be your top priority following the death of a loved one but it is something that is important, and can be somewhat frustrating amidst all of the other many emotions that you may be dealing with.

Whilst looking for the Will it may also be useful to locate the following documents (as these may all come in handy when completing your Probate and Inheritance Tax Forms):

Birth Certificate;
Marriage Certificate;
Death Certificate;
Pension Details;
Life Insurance Policies;
Insurance;
Bank Account Details;
Financial Information

So where should you start looking?

Below is a quick checklist that you may want to use as an initial step, after looking in all of the ‘obvious’ (and probably not so obvious!) places in their home or where you were aware that they stored their important documents.

Solicitors & Will Writers

If your loved one had their Will drafted professionally then the Solicitor or Will Writer that did this may be storing the original Will. You may find their details in paperwork you locate within their home, or you may know of a Solicitor/Will Writer that they frequently used.

Alternatively, you may want to contact some local firms to see if they are holding the original Will.

Banks

In some cases, banks provide a Will Writing service and then offer to store the Will.

Therefore, it may be worth contacting your loved one’s banks and building societies to see if they are holding the original Will or any documents on behalf of the deceased.

The National Will Register

Registration of Wills in the UK is not compulsory. However, the National Will Register stores almost 10million WIlls and the library can be searched, although there is a fee. Fees for searching this register start at £45.60.

If the Will cannot be found, or there isn’t a Will, then the deceased’s Estate will be distributed in accordance with the Rules of Intestacy – check out our article on the Rules of Intestacy here.

If you would like to have a FREE chat about getting your Will in place, or storage of your Will, please contact us on info@TotalLegacyCare.co.uk or 01727 865 121

Leah Waller

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26th May 202226th May 2022

Is your partner entitled to a share of your property?

Is your partner entitled to a share of your property?

If you own your property with someone else (whether a spouse, family member, friend or otherwise) then you may find it useful to read our article – How do you own your Property and why does it matter? – this will elaborate on the way your property could be held (Joint Tenants or Tenants in Common) and the implications this has on making decisions on the property, who (and IF!) you can leave it to someone of your choosing in your Will and whether, or how much, Inheritance Tax is or will be payable.

In this article, I will be looking at property that you legally own alone but that you share with someone else, a spouse, partner, loved one or friend and whether they have any entitlement to the property.

Someone may well assert an entitlement to your property upon the breakdown of a relationship, when a property is sold or upon your passing even when they have not made any financial contribution to the mortgage or where they have (or have not) made any contribution towards utilities, maintenance and the upkeep of the property.

If you are sharing a property with ANYONE, no matter how great the relationship is and no matter how much you trust that person…having something in writing that clearly sets out each person’s legal entitlement is definitely the most sensible way forward.

If you are sharing, or cohabiting, a property with someone that has no beneficial interest (share or financial interest) in the property, this should be put in writing to prevent any future issues.

Declaration of No Interest

A Declaration of No Interest is an Agreement that can be used between cohabiting individuals to set out the following:

The name (or names) of the individuals that own the property legally;
The name (or names) of the individuals that have a beneficial interest in the property;
The names of the individual that has NO legal or beneficial interest to the the property;
- This includes no entitlement to income;
- This includes no entitlement to capital (from sale proceeds);
- This includes no entitlement to occupy the property;
A clause stating that the legal/beneficial owners can sell or transfer the property at any time (without the consent of those living there with no beneficial or legal interest in the property).

Having a Declaration of No Interest in place, that is signed by all parties, will prevent any legal issues, and court hearings, and ensures that you will remain both the legal and beneficial owner of your property.

This is something that we can assist with as well as Declarations of Beneficial Interest in a property.

If you would like to have a free chat about how we can help you, please contact us on
info@TotalLegacyCare.co.uk or 01727 865 121

Leah Waller

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3rd March 20223rd March 2022

What is the difference between Mutual Wills and Mirror Wills?

What is the difference between Mutual Wills and Mirror Wills?

The concept of having Wills that mirror each other, for spouses is not something new, however there is a BIG difference between ‘Mirror Wills’ and ‘Mutual Wills’ and this could have consequences later down the line.

Mirror Wills is a term that many are familiar with but this is often used interchangeably with Mutual Wills, and they are VERY different.

So, first things first…

Mirror Wills

Mirror Wills, as you would expect, allow spouses to mirror each other’s wishes, passing their assets to the surviving spouse upon the first death and following the second death, the assets will be passed to those as agreed by both parties when the Wills were drafted.

However, unlike Mutual Wills, the surviving spouse is able to make changes to their Will, or make a new Will, following the death of their spouse, should they choose to do so.

This does however mean that, should the surviving spouse remarry, they could leave their entire Estate (including that inherited from their deceased spouse) to their new spouse and this could mean that the children of the spouse that passed first could be left with NOTHING!

Mutual Wills

Mutual Wills are not as common as they once were and are not usually recommended by Will writing professionals, for the simple reason that once one spouse has passed, the Wills become binding on the surviving spouse and they are unable to change their Will. Whilst both spouses are alive, the Wills can be amended as much as they both wish, however, following the first death no changes can be made, and if any are made they will not be legally binding or valid.

That being said, Mutual Wills may be preferred by those that want to protect their Estate and inheritance for their children if their surviving spouse remarries. Mutual Wills, unlike Mirror Wills, are not revoked by marriage and thus even if the surviving spouse does remarry, their Will will remain in place and the same as when it was made with their deceased spouse.

Typically, Mutual Wills will clearly state on them that they are in fact Mutual Wills, to save any disagreement or confusion in the future.

If you would like to have a free chat about your existing Will or making a new Will, please contact us on info@TotalLegacyCare.co.uk or 01727 865 121

Leah Waller

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3rd February 20223rd February 2022

What is a Digital Estate Plan & Do You Need One?

What is a Digital Estate Plan & Do you Need one?

A Digital Estate Plan, put simply, is a list of everything that you hold online and digitally – be that bank accounts, photographs, emails, documents, work, contracts, online accounts and every other aspect of your life that you manage digitally.

Dealing with someone’s Estate following their passing is no easy task, even when everything is in order but couple that with trying to find, and then access!, everything they hold and manage digitally…it can be a minefield.

So, it seems sensible to get everything in order and organised so that should anyone else need to access your accounts and digital assets they know where to begin. Well, that sounds easy enough, right? But, where to begin…

First things first,

Start with a list

List out all of your online accounts (including email addresses, banks, store, storage, etc.) and then for each, write out:

Username;
Password;
Subscription?
Fees?
Any other useful information (memorable words/secret questions etc.)

It may be easier to add to this each time you access an account, as there are bound to be at least a couple you forget when listing them out from the top of your head.

What do you want to happen?

Whilst it may be quite clear what is to happen with some accounts after you have passed (online saving accounts, for example), for some it may not be so straightforward, and this may take some more time to consider.

For some accounts, social media accounts for example, you may want these to pass on to loved ones, or even work colleagues if they are business accounts.

Other accounts, you may want to be closed down or deleted. Some social media platforms have their own way of dealing with legacy accounts and so if this is something important to you, you can check out your individual account settings for each of the relevant platforms that you use.

Tell Someone you Trust

It is all very well collating and organising your digital assets, but this is little good if there is no one else that knows where it is kept or stored. Ensuring your Executor or someone else that you trust is aware of your Digital Estate Plan is key to ensuring your wishes are followed (and making sure that all your assets are found and dealt with!).

Consider Professional Advice

Now that you have your comprehensive and organised list in place, it may be worth seeking professional advice to see how your wishes can be dealt with and ensure that the people that you want to benefit from your digital estate (and everything else too!), do indeed inherit.

Keep it up to date

Keep your list up to date, continually review it and as you create a new account…add it to the list straight away!

Some of the times that you may want to review your list:

Creating an account
Changing a password
Deleting an account
Renewing / amending a subscription

This list is a work in progress and the more regularly it is kept up to date, the easier it will be.

If you would like to have a free chat about your Estate Plan, on your existing Will or in relation to making a new Will, please contact us on info@TotalLegacyCare.co.uk or 01727 865 121

Leah Waller

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25th November 202125th November 2021

Will my family pay Inheritance Tax on any Life Insurance Payout?

Will my family pay Inheritance Tax on any Life Insurance Payout?

Inheritance Tax is payable at a rate of 40% on the value of your Estate over the Inheritance Tax Threshold. The Inheritance Tax Threshold is currently set at £325,000 per person and an additional £175,000 can be claimed if you are passing your residential property to a direct descendent (children / grandchildren), this is termed the Residential Nil Rate Band. Thus, an individual, passing their main residence to a direct descendant, could pass a total of £500,000 before being liable for any Inheritance Tax. This sum is transferable between spouses and civil partners, meaning that, for married couples, the Estate can total £1million before any Inheritance Tax is payable.

For more information on Inheritance Tax, check out our article, What is Inheritance Tax and how can I reduce it?

To calculate the value of your Estate, all of the assets are gathered in and their value totalled. A similar exercise is done with any debts and liabilities (credit cards, loans, funeral expenses etc.) and the total value of the liabilities is subtracted from the total value of assets and this final figure is what is considered when deciding whether Inheritance Tax is payable.

In this article, we will be focussing specifically on Life Insurance Policies and whether any payout from such a policy will need to be included when calculating the Estate assets…

Whether a Life Insurance Policy will form part of the Estate, will depend on how the policy was written. Usually, the policy is written so that the payout is made directly to the beneficiary (or beneficiaries) and so the money never enters the Estate and thus not subject to Inheritance Tax.

However, that does not mean that Life Insurance is not relevant in relation to the Estate and Probate.

Where a Life Insurance Policy has been taken out to cover a mortgage (often being a condition of the Lender before any mortgage is agreed) the Life Insurance Policy will repay the mortgage, upon death, and thus the debts and liabilities of the Estate will be reduced and this may in turn increase the value of the Estate to above the Inheritance Tax Threshold.

Alternatively, Life Insurance Policies can be written into Trust…

When a Life Insurance Policy is written in to Trust, it means that upon your death the lump sum payout (or regular payments, depending on how the policy has been set up) is paid from the Trust and not your Estate and as such it is usually exempt from any taxes (including Inheritance Tax), although this is subject to the approval of HMRC. This is usually the way in which pension plans, through an Employer, are written.

It is important that you know exactly what will form part of your Estate when you pass, whether your Life Insurance and Pensions are written into Trust (or will add to your Estate value) in order that you can make the necessary plans and put provisions in place to protect your loved ones.

If you would like to have a free chat about your options, an existing Will or in relation to making a new Will, please contact us on info@TotalLegacyCare.co.uk or 01727 865 121

Leah Waller

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28th October 202129th October 2021

Can I claim Agricultural Relief to reduce my Inheritance Tax liability?

Can I claim Agricultural Relief to reduce my Inheritance Tax liability?

A couple of weeks ago we looked at Business Relief and how this can be used to reduce an Inheritance Tax liability – you can check out the article here.

So, let’s take a look at Agricultural Relief and whether this is something you should consider when Estate planning or something you should be considering as an Executor or Beneficiary of an Estate.

First things first…

What is Agricultural Relief?

Agricultural Relief can be used on land or pasture that is used to grow crops or to rear animals intensively, examples of this include:

Land used to grow crops;
Stud farms for breeding and rearing horses;
Land used to plant trees (that are harvested at least every 10 years)
Land that is not being farmed under a crop rotation scheme
The value of milk quota that is associated with an area of land;
Farm buildings;
Farm cottages;
Farmhouses.

How much Agricultural Relief can be claimed?

Agricultural Relief can be claimed at 100% of the value if certain conditions are met.

In order to claim Agricultural Relief at 100% the person that owned the land must have farmed it themselves and so it is important to consider whether they were still working the land at the time of their death. However, the Relief is still available, at 100%, if the land was used by someone else on a short-term grazing licence.

Agricultural Relief can also be claimed at 100% if the land was let on a tenancy that commenced on or after 1 September 1995 and in some circumstances it is available for property owned before 10 March 1981 if other criteria are also met.

Where Agricultural relief is not available at 100% because the criteria and conditions are not met, the Relief may still be available at a reduced rate of 50%.

When considering claiming Agricultural Relief it is important to note that the buildings must be of a size and nature that is appropriate to the farming activity that is taking place; the properties will be valued as if they can only be used for agricultural purposes (which may well be lower than a usual residential property valuation) and if there is any value above this then this would not qualify for Agricultural Relief.

What Agricultural relief CANNOT be claimed for

The following assets will NOT qualify for Agricultural Relief (but may qualify for Business Relief):

Equipment and Machinery used for farming;
Derelict Buildings;
Harvested Crops;
Livestocks;
Property that is already subject to a binding Contract for Sale.

It is important to note that when calculating the Agricultural Relief, any mortgages or secured debts against the property or land will need to be deducted first and then the Relief can be calculated.

If you have claimed Agricultural Relief then you cannot also claim for Business Relief for the same asset or assets. However, if Agricultural Relief is not available at the full 100% then you may be able to claim Business Relief on the remainder and this should be considered very carefully.

If you think that your Estate may qualify for Agricultural or Business Relief, or want to find out, it is important to seek specialist advice as this can make a huge difference when sorting out Inheritance Tax and the relevant forms that are required.

Alternatively, if you are an Executor (or Administrator) then you will know that you are under an obligation to maximise the Estate for the beneficiaries and therefore take advantage of all reliefs that are available to you. If you are unsure whether Agricultural or Business Relief applies (or indeed any other Reliefs) please seek the help of a specialist as this could be extremely beneficial to the beneficiaries and reduce the Inheritance Tax liability of an Estate enormously.

If you would like to have a free chat about your options, the Reliefs available, on your existing Will or in relation to making a new Will, please contact us on info@TotalLegacyCare.co.uk or 01727 865 121

Leah Waller

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29th September 202129th September 2021

Can I claim Business Relief to reduce my Inheritance Tax liability?

Can I claim Business Relief to reduce my Inheritance Tax liability?

Many of our clients ask us about Inheritance Tax, how much they will have to pay and if there is any way for them to reduce their Inheritance Tax liability.

There are a number of reliefs and mechanisms that can be used upon death, and before through Wills and Trusts, to reduce an Inheritance Tax liability and one of these is Business Relief.

As the name suggests, to be eligible for Business Relief the assets must have some link to Business of the deceased but let’s have a look at this in more detail…

What is Business Relief?

Business Relief can reduce the value of a business or the business assets when valuing it for Inheritance Tax purposes and calculating the amount of Inheritance Tax that is payable.

Any business owned, or part-owned, by the deceased, and any shares in a business are included in an Estate when valuing it for Inheritance Tax purposes but the Executor (or Administrator) of the Estate may be able to claim Business Relief of 100% or 50% depending on the nature of the business assets that were held by the deceased.

*It is important to note that in most cases, the business assets will need to be held for at least two-years prior to death to qualify for Business Relief.

What is eligible for Business Relief?

As mentioned, some Estates will qualify for Business Relief at 100%, this would include where the deceased owned a business, or part of a business, and any shares that are owned in an unlisted company.

*NOTE: this does not include shares owned in listed companies (on the London Stock Exchange, for example).

Where 100% Business Relief is not available, the Estate may qualify for Business Relief at 50% and this would be on business assets such as:

shares which control more than 50% of the voting rights in a listed company;
land, buildings and machinery owned by the deceased and that were used in a business that the deceased owned or controlled;
land, buildings and machinery that were used in a business and held in Trust that it has the right to benefit from

Remember, that the Business Relief is only available on assets that were owned by the deceased for at least two-years prior to their death.

When Business Relief will not apply

An Estate will not qualify for Business Relief if the business owned by the deceased was a not-for-profit organisation, mainly dealt with securities, stocks or shares land and buildings or in making and holding investments, was being sold or is being wound up.

In addition, a business asset (land, building and machinery) will not qualify for Business Relief if it also qualifies for Agricultural Relief (see our blog in a couple of weeks on this!), was not used mainly for the business in the two-years prior to the deceased’s death or if it is not required for the future use of the business.

If you think that your Estate may qualify for Business Relief, or want to find out, it is important to seek specialist advice as this can make a huge difference when sorting out Inheritance Tax and the relevant forms that are required.

Alternatively, if you are an Executor (or Administrator) then you will know that you are under an obligation to maximise the Estate for the beneficiaries and therefore take advantage of all reliefs that are available to you. If you are unsure whether Business Relief applies (or indeed any other Reliefs) please seek the help of a specialist as this could be extremely beneficial to the beneficiaries and reduce the Inheritance Tax liability of an Estate enormously.

Leah Waller

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8th July 20218th July 2021

Where do I keep all of my Information so that it is accessible upon my death?

Where do I keep all of my Information so that it is accessible upon my death?

We all have so many accounts these days, both online and physical accounts. Whether that be bank accounts, gas, electrocity, other utilities, social media and much much more…we are all collecting accounts at an extraordinary rate and keeping track of all those sometimes seems an impossible time for us, let alone for someone else trying to find and collate all that information when we pass.

It is estimated that the average UK consumer is likely to have over 200 online accounts – this is a staggering number and as we are advised to not reuse the same password for all (although, if we are honest how many of us actually take heed of that advice?) that is a lot of information to keep track of.

Another little statistic, from a YouGov survey, that I thought was worth mentioning is…

67% of respondents wanted their social media accounts taken down or removed following their death (with 7% wanting them to remain online). For some accounts, you are able to change your preferences during your lifetime and add someone to take charge of your account following your death but for others, someone will need the login details or just wait for the inactivity to cause the account to be deactivated.

So, this is all very well and good me telling you about this BUT, what can we do about it and where should we be storing this information so that we don’t leave our loved ones with an even bigger headache than is necessary?

Well, that’s where we can help!

We have designed an easy to use ‘Assets & Liabilities’ sheet where you can keep all your information. Either store it on your computer (password protected but make sure you give someone else that password!) or print it, fill it in – and keep it updated – and keep it in a safe place, perhaps with your Will, Lasting Powers of Attorney and other important documents.

This document is only a template and so some sections will be relevant and others not, however you can add and amend as is right for you and ensure that all of your information is kept up to date and all in one place (that is SAFE!).

So what sorts of things do we need to keep track of?

The ‘Assets & Liabilities’ sheet goes through all of the following:

So, first we start with the information about you and everything that your loved ones may need – your National Insurance Number, NHS Number – and other basic information as it is surprising how little information you retain when grieving. Having everything written down and to hand makes everything so much easier.

We have space to keep details of your property, or properties, including mortgage details, utilities and service providers.

We have space to keep details of finances, bank accounts, ISAs, investments, employment benefits, life insurance policies and any other places where money is held.

It is also important to keep details of any pensions, benefits and other income that you receive.

Following that is the social media accounts and email accounts.

We have also left space for you to detail any personal items of value and your wishes for these (should you have any).

As I said at the beginning, not all parts will be relevant to you and some parts may become relevant at a later date, or make you think about something that may well have been forgotten! However, this is a great template to get you started and to begin to get everything in order for you.

Click here to download your free copy of the ‘Assets & Liabilities’ sheet

If you would like to have a free chat about your existing Will or making a new Will, please contact us on info@TotalLegacyCare.co.uk or 01727 865 121

Leah Waller

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