Update Your Will Week
During Update Your Will Week, we take a look at how often you should review your Will and some of the life events or changes that might prompt you to think about updating your Will.
We recommend that all clients review their Will every 3 to 5 years, but sooner if their personal or financial circumstances change.
For your information, we have highlighted below some of the more common situations in which you must or should update either your Will, tax affairs or estate planning generally.
Specific Gifts
A legacy of a specific item will not take effect if you no longer own that item when you die, unless you have included specific provision for this in your Will. You may therefore want to review your Will. If your Will includes a legacy of a particular property and you later mortgage that property then you must review your Will.
Cash legacies
If your Will includes a cash legacy, you should keep this under review, particularly if there has been significant inflation since you signed your Will, or if the value of your estate increases or decreases substantially.
Jointly Owned Assets
If you own an asset jointly with someone else (e.g. bank account, furniture) when you die usually this will pass to the surviving owner regardless of the terms of your Will. If you own a share of a property, again the surviving owner(s) may automatically inherit your share when you die regardless of the terms of your Will. Alternatively, it may be that the surviving owner(s) refuses to sell the property to pay your share to your estate.
Foreign Affairs
If you emigrate you must review your UK Will. If you acquire an asset abroad (e.g. a holiday home or an overseas investment) then you must review your Will.
Business interests
If you own a business (whether in partnership, through a limited company or as a sole trader) it is important that you know what will happen when you die: how will the business continue; what rights do your executors have; and will the value of your share avoid inheritance tax.
Life Policies, Pension Death Benefits and Death-in-service payments
The benefits payable under any of the above will not necessarily be paid to those named in your Will. Furthermore, you can reduce the inheritance tax payable on your death by nominating or assigning these benefits outside of your Will.
Trusts
If you acquire an interest in a trust, please contact us to check how your Will affects this and whether you should update your Will.
Death of Beneficiary, Executor, Trustee or Guardian
If someone named in your Will dies, you may need to update your Will.
Marriage/Civil Partnership
If you marry or enter into a registered civil partnership, your Will will become invalid automatically. You can make a Will beforehand which is not revoked automatically in this way; your solicitor will be able to help with this.
Inheritance Tax
When you die, your estate may be liable to inheritance tax. It is important that you review to what extent this will apply to your estate when you die, as it will affect who inherits and what they inherit. It is possible to take steps during your lifetime to reduce the amount of inheritance tax which would be payable on your death.
Every individual has an inheritance tax allowance. Widows, widowers and surviving registered civil partners are entitled to an additional allowance and it is important that you collect the documents and information which your executors will need to claim this allowance.
Long-Term Care
In the future, you may require care whether in your own home or in a residential or nursing home. If you have to pay for this care yourself, this will affect who inherits and what they inherit when you die. If you need advice on funding options, how to protect your estate from potential liability for care fees, or the implications for your Will generally, it is important to contact your solicitor.
Inheritance (Provision for Family and Dependants) Act 1975
Generally, you have absolute freedom to decide who inherits what when you die. However, this Act allows certain people to claim financial provision from your estate. Those who may be able to bring a claim include a spouse/registered civil partner, an ex-spouse/registered civil partner, a cohabitee, a child and any financial dependant.
Lasting Power of Attorney
We recommend everyone considers making a Power of Attorney appointing one or more people to sign for them should they become physically or mentally incapable of this themselves. This helps prevent a person’s financial affairs from falling under the control of the Court of Protection, which can be expensive, time consuming, inflexible and frustrating.
Independent Financial Advice
Making (and reviewing) your Will is one significant aspect of estate planning. Another is our strong belief that everybody seek professional financial planning advice.
It is important that, whatever your situation, you consult a solicitor to make sure that your Will is kept up to date so that it reflects your current circumstances and wishes. If you would like more information about when and how to update your Will, or need advice on any other matter, please contact us.
Thomas Woodlee is a solicitor in the private client team at Barker Gotelee, Solicitors in Ipswich.
Suffolk Private Client Solicitors – for more information on our range of legal services, please call the team on 01473 611211 or email [email protected]
