all you need to know about wills
FAQs on Wills
Wills are documents which enable us to decide what happens to our assets when we die. They can be changed at any time during our lives (often with a ‘codicil’) as long as we are deemed to be in sound mind. Since circumstances change our wills should be reviewed too. And they can be updated or replaced. They have to be formal and comply with certain regulations to prevent the likelihood of fraud. Though they can be accompanied by an informal ‘letter of wishes’. They have to be stored in a safe place. And the executors, who are responsible for doing what our wills require after our deaths, need to have agreed to these responsibilities, to know the wills exist, to know where they’re kept, and to stay available to discharge their responsibilities when the times come.
The Executors of a Will are the people or professionals chosen to make sure that the Testator’s wishes are carried out once he or she has passed away. Executors are personally liable for making sure this happens and there are often complex rules and forms involved, which is why we generally recommend Professional Executorship to our clients. The main duties of the Executors are as follows:Arrange the deceased’s funeral
- Get details of all assets and debts
- Pay any inheritance tax that is due
- Obtain a grant of probate, recognising their lawful ownership of the assets of the deceased
- Bring the assets together in their hands
- Pay the debts of the deceased
- Hand over, or pay out, specific bequests
- Determine what is left (ascertain the residue)
- Distribute the residue
As you can see, the process is quite lengthy and complicated and, as Executors are personally liable for carrying out all of the above during what is often a difficult time for them (having very recently lost a loved one), we generally suggest that Professionals are appointed, whether jointly in order to assist a personal Executor or to act solely. As a regulated law firm, we are able to be appointed as Executors ourselves and we are very experienced when it comes to dealing with our clients’ estates, especially should the matter later become contentious. We offer a generous discount for this service to all of our clients and the main advantages are as follows:
- Less stress for loved ones, as we will be able to guide them through the process of Probate, and take on most of the burden through what will already be a difficult time for them.
- Having someone independent and impartial to oversee the process is a huge advantage should the Probate turn contentious – there will already be someone on hand who is experienced with dealing with these matters. Although clients do not necessarily anticipate any family arguments or disputes, these are becoming ever more common.
- We offer these services to our clients for competitive, fixed fee quotes, which makes sure that the Estate is dealt with properly for the lowest cost.
Where we are appointed as Professional Executors, we only charge competitive fees and we agree our fees with beneficiaries at the outset of commencing Probate. We know that there are scare stories regarding Professional Executorship and Probate but you can rest safe in the knowledge that reasonable fees will be charged in order to deal with the administration of your Estate.
General powers of attorney grant somebody you trust the authority to deal with your affairs although you still have your own faculties. This can be helpful if you’re abroad or indisposed. General powers of attorney do not have to be registered.
Every parent should consider what would happen if they were in an accident and were no longer there to look after their children. It is wise to carefully consider who you would like to be given responsibility for raising and looking after your children should you pass away.
It is also necessary to consider how this will be financed, and we are able to set up Children’s Protective Trusts, which allow for distributions to children and their guardians whilst children are growing up to cover things such as education and holidays. These mean that a bereaved child’s welfare can be looked after, whilst they will still receive their inheritance once they are at a mature age and able to deal with finances responsibly
Mirror wills are for married or civil partners who have identical or similar wishes.
Powers of attorney let somebody manage affairs for a short time if somebody is abroad, for example, or indisposed.
Although a power of attorney might be used if you lose your faculties, you have to have those faculties at the time they are appointed. You have to not only choose them but decide what powers they will have. Importantly attorneys cannot be involved in making wills for the people (donors) for whom they have power of attorney. Many people create a power of attorney as a safeguard because nobody knows the future. Though some people do know their future in part (they may know that they have Alzheimer’s, for instance). That power of attorney can protect you, your loved ones, your business interests and more.
Property and Financial Affairs LPAs and Health and Welfare LPAs can have the same attorneys but cover different areas. It is useful to have both in place.
Wills should be stored in safe and secure places. Home is OK but with solicitors and banks, with will-depositaries or the Probate Service is best. Importantly they should be somewhere where the executors can find them.
Trustees are often also executors and look after assets in the trust for the benefit of beneficiaries.
As noted in the Wills section above, we are able to offer a wide range of Trusts within the Wills we draft.
As a regulated law firm, however, we are also able to draft freestanding Trusts. These include Home Protection Trusts, which are a type of Trust created during your lifetime and which help to protect your property from a range of third party creditors, such as care home fees, and can also benefit you (and your beneficiaries) by avoiding the need for Probate on the property.
Witnesses are independent observers of signing and must be 18 or over. They cannot be blind or a spouse or civil partner, or indeed any relation. They don’t need to know the details of the document but they cannot benefit from it.
A will may fail because the assets have already been given away during lifetime or the estate is insolvent. Sometimes the intended sums have to be reduced. If the will fails because one or more beneficiaries die then gifts are treated as residuary.
You can decide as much as possible. Attorneys are supposed to encourage and support their donors as long as those donors are capable.
Nobody. But the law in England and Wales allows spouses, ex-spouses, recently separated partners, civil partners, ex-civil partners, co-habitees, children and other dependants (or their representatives) to claim for reasonable financial provision under the Inheritance (Provision for Family and Dependants) Act of 1975.
All adults are assumed to have mental capacity until it’s proved otherwise. If there are disputes, the Mental Capacity Act 2005 sets out clear principles. The main test is ‘could the donor be safely left on their own to use a gas hob?’
Attorneys can buy or give gifts of money on behalf of the donor, including donations to charities which the donor would usually support, to people who normally receive gifts from the donor, and on suitable occasions. But those gifts must be sensible in relation to the donors’ means. Large gifts are usually not allowed. But a court can allow them.
Nothing can happen in England or Wales until it has been registered by you or an attorney with the Office of the Public Guardian (OPG). Property and Financial Affairs LPAs and Health and Welfare LPAs have to be submitted separately even if there are common elements. Then they can take 10 weeks even if there are no mistakes in the documents. With mistakes a 3-month delay is inevitable.
The procedure to amend a power of attorney depends on the type of power and the location. So you should check.
If attorneys die before their power of attorney is used the donor, being still sound of mind, will often replace them. So it’s a good idea to have a replacement attorney waiting in the wings.
Anyone who is of sound mind in England or Wales can revoke their lasting power of attorney, even after its registration, but they must provide a written statement known as a ‘deed of revocation’ and send it to the Office of the Public Guardian (OPG) to cancel the registration.
Band and financial services providers need to see the relevant registration documents from the Office of the Public Guardian (OPG).
A certified copy of a general power of attorney is a photocopied original on which each page should be endorsed with the words ‘This is a true and complete copy (of the corresponding page) of the original’. The donor or granter usually signs the certified copy. But others can. Yet usually only a suitably-qualified independent professional is allowed to sign as certifier.
In England and Wales the enduring power of attorney, which only covered property and finances, was replaced on 1st October 2007. It is still valid but the Office of the Public Guardian (OPG) must be notified as soon as the donor starts to lose their mental capacity.
Jointly-appointed attorneys must agree decisions and all sign documents together. Yet jointly and severally means any one of the attorneys can make a decision and sign documents with or without others – making this quicker but you have to trust them to act alone.
The inheritance tax threshold is £325k for singletons, meaning that – after debts and funeral costs are covered – anything over that amount is taxed at 40% tax. This threshold is higher for married couples or those in civil partnerships.
Wills may be changed by writing new and valid wills or by making valid codicils to them. Codicils are documents which amend already-executed wills instead of replacing them.
Specific gifts like broaches or watches. Pecuniary (i.e. money) gifts to individuals have a maximum value of £100k. And residuary gifts (that’s anything left). This can be vague but stops it being treated as if there was no will.
Wills become legally valid when they’re signed, dated and witnessed in keeping with the Wills Act (1837).
Full names and details including dates of birth and last known addresses whenever possible. Not initials or nicknames, pet-names or similar.
Usually bank accounts must be separate. But if they are a couple this may not be practicable. Yet the account providers should be aware of circumstances if there is a shared account.
There are several different types of power of attorney. But lasting power of attorney is chiefly used for either health and welfare or property and financial purposes.
The first clause of a Will usually reads as follows:
“I revoke all my earlier testamentary dispositions”.
This clause is absolutely essential as it ensures that the Will being produced will revoke any former Wills and, once validly Executed, will be the Testator’s final Will and Testament.
If, however, a client has a Will or property in another jurisdiction (ie. outside of England and Wales) then this revocation clause needs to be drafted differently as the Will needs to be limited to England and Wales. A separate Will for property in the foreign jurisdiction will then need to be drafted by a lawyer practising there.
Not including this essential clause or incorrectly drafting it is a common pitfall amongst untrained and unregulated Willwriters – if this is not properly included foreign Wills can be unintentionally revoked or foreign assets may pass in accordance with local intestacy laws.
Finally, one piece of knowledge that is not commonly known, is that marriage revokes a Will. When we deal with Probate and Estate Administration, we regularly encounter Wills drafted by unregulated Will Writers that have not taken into consideration future marriage. As you can imagine, this can cause significant problems for loved ones, as often they have made carefully made plans that simply do not take effect, as their Wills have been rendered invalid. When we see couples who intend to marry in the future, we are able to draft their Wills so that this marriage does not revoke their Wills,
When a business is likely to form part of the estate, we are able to include a Business Continuation Clause, which will allow the Executors (or other chosen persons) to carry on the business.
For business owners, this is very important, as otherwise their business’s value may plummet after their death, leaving their beneficiaries with far less inheritance than could be the case.
We are also able to put in place business Lasting Powers of Attorney, which will allow Attorneys to carry on the on the Donor’s business should they lose mental capacity; again, this can really help to protect the value in someone’s business if they lose capacity. For more information on Lasting Powers of Attorney, please see our dedicated LPAs page here.
Sometimes clients would like to leave specific gifts and legacies within their Will, such as treasured possessions to particular loved ones. Goodwills are more than happy to include these gifts within our drafting and are also able to advise on common pitfalls regarding gifts, such as those regarding certainty and specificity.
It is also important to consider whether or not gifts are to pass on first or second death and also to take note of any tax implications, which Goodwills is also able to advise on.
The residuary estate is the property that remains in a deceased person’s estate after all specific gifts have been made and all debts, taxes, administrative fees, probate costs and court costs have been paid. Often, the residuary estate will be left to the spouse on first death, and then to the children on second death. However, family arrangements are becoming ever more complex in modern society and so this simple distribution is not necessarily relevant.
In the case of children from previous relationships, we are able to offer a variety of Trusts to protect a client’s inheritance so that it passes to their own children, but still give the survivor a Life Interest to live in the property.
It is also important to consider substitution of issue (if a beneficiary passes away, do you wish this gift to pass to their children/grandchildren/etc.)? This is an area of the law that we are able to advise on and clients should always consider this carefully when making a Will. Client should also carefully consider whether and how much they wish to leave to a charity, as whilst this can have positive tax consequences, it can also have serious unintended negative tax consequences if not drafted correctly; Goodwills is able to advise on the tax consequences of leaving part of your Estate to charity.
Clients should all be aware that if someone is excluded from their Will that such a person may make a claim against the Estate and that this can lead to chosen beneficiaries being left less than was intended by the Testator. The class of persons who are able to contest a Will is not limited to relatives or close family but can include a variety of other dependents. For this reason, we would always recommend that clients receive proper advice and guidance if they think a claim might be made against their Estate (or even if they are not under this impression, as there may be people eligible to claim that the client is not aware of).
We provide an Exclusion Service, where we will prepare a legally drafted Letter of Wishes that can be read out in Court should such a claim be made against the Estate. This involves careful consultation with the client to ensure that the chances of success of any claim are minimised. The Exclusion Service also involves the drafting of a clause within the Will, which specifies that a particular person has been Excluded from the Will and makes reference to the aforementioned Exclusion Letter. We are also able to provide this services in cases where it might be argued that insufficient provision was made for a particular beneficiary, which can also lead to a claim.
As a final point, it is worth noting that it is not possible to prevent a claim from being made entirely but our service provides a robust defence against any such claim. In cases where Testators feel a claim is likely, we always recommend that Goodwills is appointed as Professional Executors, as we have the legal expertise and knowledge necessary to help safeguard the Estate against such a claim should this actually materialise after the Testator’s death.