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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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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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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29th October 202011th November 2020

Wills: The Basics

Wills:
The Basics

We thought we would go back to the basics and answer some of the questions we get asked:

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What is a Will?

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Why do I need a Will?

?

What happens if I don’t have a Will? OR
What happens if I die without a Will?

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I don’t have anything, do I still need a Will?

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Why is a Will important?

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How long does it take to make a Will?

So, let’s get going…

What is a Will?

A Will is a legal document that sets out what should happen to all of your belongings (money, property, cars, possessions etc.) when you pass away.

Your Will can also appoint Guardians for your children (should they be left with neither parent). A Will is the only way (in the UK) of appointing guardians for your children.

Your Will appoints Executors, the people that you trust to be responsible in administering your instructions.

Your Will can also include any funeral wishes that you may have (although this is optional).

Why do I need a Will?

We often get asked ‘Why do I need a Will?’ or ‘What happens if I don’t have a Will?’ or even ‘What happens if I die without a Will?’.

Ultimately it is the same question…with the same answer, just asked in different ways.

So, you need a Will because if you do not have a Will, or (to put it another way) die without a Will, then you will die INTESTATE.

If you die intestate, this means that the Rules of Intestacy apply and you, and your family, lose control of where your money, property and possessions go and this is decided by the Rules of Intestacy.

Having a Will in place allows you the control to decide who benefits and inherits upon your death.

I do not have anything, do I still need a Will?

YES!

Even if you perceive that you have ‘nothing’ this can mean very different things from one person to another.

As we have said above, a Will is the only way to determine that only the people that you decide can benefit and inherit upon your death, rather than it being left to the Rules of Intestacy.

Why is a Will important?

For fear of repeating ourselves (although it is important!), your Will is important as it allows you control and allows you to decide where your estate (all your money, property and assets) go.

It’s not just about your money though, you can also choose guardians for your children, name your executors and even make provision for any pets that you have.

A will can also allow you to create Trusts that may help with reducing your Inheritance Tax liability.

How long does it take to make a Will?

Usually, we just need about an hour of your time to explain everything to you, take down all your requirements, answer all your questions and then we’ll do all the work in the background.

We then return to you with your Will for signing, we provide both independent witnesses, to make it legally binding and then your Will is complete.

From the initial call to you having your signed Will in your hand with all your wishes, legally compliant and complete can take as little as a few days, we like to make it as simple for you as possible for you. Having said that, we never rush you to finalise your Will until you are 100% happy with the Will and that it covers all of your wishes.

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

Leah Waller

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15th October 202015th October 2020

How much does a Will cost?

How much does
a Will cost?

It’s always tricky to work out how much something costs, or is worth, before you get a quote. To guess how much anything will cost we need to look at the value of it first. ‘Value’ is described as “the regard that something is held to deserve; the importance, worth, or usefulness of something”.

If we break those 4 areas down for a Will then we can start to understand the value:

The regard that something is held to deserve

Writing a will is not as simple as putting pen to paper (or finger to keyboard). The process, when followed properly, should include an initial meeting where the Will Writer or Solicitor will take time finding out what the clients needs are, taking down all the relevant information and answering any questions the client may have. There may be a requirement to plan for inheritance tax, or to plan for vulnerable or disabled beneficiaries, and workout the best solution to meet all the clients needs.

Once this has happened the Will can then be drafted and a draft version sent to the client and explained fully to them.

If all is in order the Will can be finalised, printed and signed. The Will Writer or Solicitor will have additional paperwork to complete to be fully compliant and complete their due diligence.

There is a fair amount of work to complete in order to put a valid Will in place and it should take around 4-6 hours for an efficient Will Writer or Solicitor to complete, even with what is considered a ‘simple Will’.

The importance

The next part to discuss is the Importance of a Will, this should be self-explanatory but put simply, without a Will in place you don’t get to decide where your assets end up. Having a simple Will in place removes additional stress that your family and loved ones will have to endure without having a Will in place in dealing with the Rules of Intestacy. A Will not only dictates where your money will go, it also covers a variety of other important decisions, such as, guardians for children (if under the age of 18 years) your funeral wishes, your executors and any Trusts that you may wish to put in place to protect your loved ones.

Worth

If you ask anyone who has had to deal with the Administration of an Estate without a Will then they are sure to explain how much easier it would have been with a Will. It’s also more costly to go through the legal procedure when there is no Will (several times the amount it would cost to put a Will in place). If you put a Will in place you could save your loved ones time, expense and hassle – which must be worth it, right?

Usefulness

Having explained the previous areas, how useful is a Will?

Your Will lists clearly your instructions and what you want. It is the only way (in the UK) to ensure guardians are put in place, for your children, if required, explains your funeral wishes to your executors and directs your executors on how you would like your Estate to be distributed. Your Will can ensure people are protected in the event of your death and Trusts can be included to plan for inheritance tax amongst other important issues such as vulnerable or disabled beneficiaries.

So, how much should a Will cost?

It will vary on what you require and where you get it from. You can pick up a Will Pack from WH Smiths for under £20 and do it yourself. Although a word of warning…completing a Will yourself comes with risks, you’ll need to ensure it is correctly completed and legally valid, you may not realise this until it is too late.

If you go to a professional, you will be expecting to pay anywhere between £200-£500 for a simple Will. If you need Trusts in place or there is additional work then you can expect to pay more. Many companies offer an initial consultation free of charge and all prices should be quoted up front before work commences

We are always happy to have a chat with you about putting a Will in place or answer any questions you may have.

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

Neil Barras-Smith

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1st October 20201st October 2020

What is the role of an Executor?

What is the role of an Executor?

Being appointed as an Executor is a blessing but can also be a burden, but worse of all is when it comes as a surprise!

If you are asked to be an Executor, you may have a few questions:

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What is an Executor?

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What does an Executor do and is there a specific process to follow?

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Does being an Executor cost me anything?

So, let’s have a look at some of those questions…

What is an Executor?

An Executor is appointed by someone in a Will, so that when that person passes away the Executor can collect and protect the estate, property and assets of the deceased and carry out the distribution of such items in accordance with the Will and the deceased’s wishes.

Being an Executor can involve a considerable amount of work, but it is a privilege to be asked. The person that has appointed you as an Executor, has put their ultimate trust in you to carry out their final wishes, to collect in and distribute their estate and possessions as they wanted on the basis that they trust you to do so.

Some of the initial steps to take upon becoming an Executor are:

Ensuring that a Death Certificate is obtained

As the Executor you will be responsible for notifying certain people, companies and authorities of the death and so the Death Certificate will be required. It is possible to obtain more than one copy of this and so it may be wise to do so.

Finding the Will

As the Executor you will need the Will in order to apply for Probate.

Consider whether you need help

As the Executor you do not have to carry out all of the administration of the estate by yourself, you can ask for professional help from solicitors, probate specialists and/or tax advisers.

If the estate is relatively small and doesn’t have any complexities, the Executor may well decide that they can carry out the process by themselves and this is also fine.

Applying for the Grant of Probate

This is the official document giving you authority to administer the estate of the deceased, collect in and deal with their assets and then distribute them accordingly.

Collecting in the Assets

The Will and any accompanying documents that the deceased may have left may well give specific instructions as to what the deceased has and, importantly, where it can be located, however such specifics may not be given.

As the Executor you will need to ensure that you collect in and account for all of the deceased’s assets including property, stocks, shares, bank accounts, ISAs, personal items etc. The Executor will also be responsible for ensuring that relevant insurance is in place for the assets until they can be distributed in accordance with the Will.

Paying the estate debts and any taxes

The estate is responsible for paying the funeral costs and any taxes due in relation to the deceased and the estate. The Executor is not responsible for paying these personally however, the Executor is responsible for ensuring that these are paid from the estate. The Executor should also put a notice to debtors in the London Gazette.

Distribution

The Executor will then be responsible for distributing the estate assets, following the payment of all debts and taxes, in accordance with the deceased wishes as set out in their Will. A detailed record of this, and all the steps taken by the Executor, should be kept throughout the process.

Remember, if you are putting your Will in place, have a chat with your proposed Executors and let them know that you trust them implicitly and so that is why you would love them to be an Executor. Having the conversation may well be difficult but it will save what can be a shocking, surprise should anything happen to you and they are required to act.

An Executor has the right to refuse to act, if they are unwilling to do so at the time they are needed, and so discussions at the time that a Will is put in place are important to overcome this.

An Executor may be unable to act, through incapacity or if their death occurs before yours, however having conversations with your proposed Executors, when putting your Will in place, should prevent any surprises and limit the risk of them renouncing their obligations when the time comes.

We are always happy to have a chat with you about who you may want to appoint as your Executors and even help with the discussion with Executors and answer any questions that they may have.

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

Leah Waller

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want to book a
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17th September 202017th September 2020

What is the role of a Trustee?

What is the role of a Trustee?

You may have been appointed as a Trustee in someone’s Will or thinking about appointing someone you trust as a Trustee within your own Will, BUT what does it actually mean and what does the Trustee do?

Let’s take a look…

A Trustee is someone appointed to look after and manage the assets within a Trust and administer/distribute the Trust in accordance with the instructions set out.

A Trustee must always act in the best interests of the beneficiary, act honestly and fairly towards the beneficiaries of the Trust, whilst ensuring that they follow the terms of the Trust.

When appointing Trustees within your Will (perhaps for a Trust where your children, grandchildren or great-grandchildren, will be the beneficiaries, whilst under the age of 18), you can appoint a maximum of four Trustees, although you can appoint reserve Trustees if you wish. In the majority of cases people will choose the same executors and Trustees however, this is not always the case and you can appoint different Trustees and Executors.

Who to choose as a Trustee…

If you are placing property or land into a Trust, then you will need a minimum of two Trustees.

After knowing how many Trustees you need, you need to have a think about WHO would be the best Trustees.

Trustees must be at least 18 years of age and able to take on the role. Now, this may sound obvious but taking on the role and responsibility as a Trustee can be more suited to some than others and just because someone has reached the age of 18 does not necessarily mean they are able to take on such a responsibility.

Another consideration to think about is; your Trustees MUST be able to work together. Where you have more than one Trustee they must be able to make a UNANIMOUS decision before an action is taken and thus being able to work together is imperative.

It may go without saying, BUT your Trustees must have capacity, be of sound mind and be trustworthy.

Trustees can be your family or close friends, whilst others opt for appointing professionals (especially where the Estate may be quite complex). However, even if a professional is not appointed, a family or friend that is appointed as a Trustee can always seek professional help as and when required if they think it is necessary.

So, what is the role of the Trustee?

As we have said, the Trustee must act in accordance with the terms of the trust and always act in the beneficiaries best interests, but additional responsibilities include:

Act fairly (this is important where there is more than one beneficiary);
Protect the assets that are within the Trust;
Insure the assets of the Trust if necessary;
Distribute the income of the Trust to the beneficiaries;
Distribute the capital to the beneficiaries;
Keep accounts and an accounting history of all transactions;
Complete Tax Returns and pay any tax that may be due to HMRC;
Declare all income and Capital Gains Tax that is payable;
If Inheritance Tax become payable, notify HMRC;
Keep a record of any income and expenses from the Trust;
Take reasonable care when making any investments;
Register the Trust;
Act in accordance with the Trustee Act 2000.

Remember, ALL Trustees must act UNANIMOUSLY.

Trustees must not personally benefit from the Trust.

All this may seem a large burden to place on your Trustees but professional help is always available to Trustees to support with managing trusts if required.

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

Leah Waller

Click here to find out more...

Have a Question or
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FREE Consultation?

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

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

LIFE INTEREST TRUSTS

Is your partner entitled to a share of your property?

Declaration of No Interest

What is the difference between Mutual Wills and Mirror Wills?

Mirror Wills

Mutual Wills

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

Alternatively, Life Insurance Policies can be written into Trust…

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

What is Agricultural Relief?

How much Agricultural Relief can be claimed?

What Agricultural relief CANNOT be claimed for

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

What is Business Relief?

What is eligible for Business Relief?

When Business Relief will not apply

Wills:The Basics

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What is a Will?

Why do I need a Will?

I do not have anything, do I still need a Will?

Why is a Will important?

How long does it take to make a Will?

How much doesa Will cost?

The regard that something is held to deserve

The importance

Worth

Usefulness

So, how much should a Will cost?

What is the role of an Executor?

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What is an Executor?

What is the role of a Trustee?

Who to choose as a Trustee…

So, what is the role of the Trustee?

Wills:
The Basics

How much does
a Will cost?