Download - Protecting your family's future
Bolt Burdon’s
Wealth and Estate Planning Team
Protecting your Family’s FutureWills, Tax, Domicile and Lasting Powers of Attorney
Why Make a Will?
• You decide where your assets go on your death• You can choose who you would like to deal with your
estate administration• Guardians • Minor beneficiaries – age they inherit• Trusts• Funeral arrangements• Can avoid a dispute
When to Review your Will
• Every 3-5 years• Changes in the law
• Change in circumstances• Inheritance• Marriage• Divorce • Death• Birth
What happens when you don’t make a Will?
Survived by partner
Gets nothing!
Claim on deceased’s
estate?
Survived by Spouse/Civil
Partner and no children
Estate £450,000 +
Y N
If parents/siblingsliving
Spouse – personal poss and first
£450k + ½ residueParents/siblings – ½ residue equally
Everything to Spouse/Civil
partner
No spouse, civil partner, or
children
Parents
Siblings whole blood/
half blood
Grandparents
Aunts/uncles whole blood or their issue
Aunts/uncles half blood or their issue
CROWN
Survived by Spouse/Civil Partner and
children
Estate £250,000 +
Everything to Spouse/Civil
partner
Spouse – chattels, first £250k and life interest in
½ residueChildren – ½ residue
when reach 18 and other half when spouse dies
Y N
What should you be thinking about when making your Will?
• Look at whole picture• Foreign assets? - Will to cover worldwide assets or limited in scope• Joint assets? – effect of death• Pensions – part of your estate / nominations• Executors and Trustees – suitability (particularly if trusts involved)• Guardians• Animals• Beneficiaries
• Who• How will you benefit them
Specific legacyi.e my Rolex watch to John
Pecuniary legacyi.e £2,000 to John
Charitable legacy?
Share of the residuary estate(part left over after payment of debts, tax and legacies)
Split into percentages?
TrustsProtection / control
Inheritance Tax – the basics• Primarily a tax on death but:
• Lifetime gifts• PETS
• How is inheritance charged on an estate on death?• Nil rate band (NRB) £325,000 fixed until at least 2015• Anything over and above – 40% tax
• Transferable NRB• Worked out as a percentage of ‘unused’ NRB
• Charitable giving – reduced rate of IHT – 36%
• Other reliefs• BPR• APR
Capital Gains Tax – the basics• When sell or ‘dispose’ of an asset, CGT may be payable
• Dispose means• sell• give it away • transfer it to someone else • exchange it for something else • receive compensation for it - for example you receive an insurance
payout when an asset has been destroyed
• Annual allowance £11,000• Principal Private Residence relief – election if have more than one home
– 2 years• Taxed at 18% or 28% depending on your income tax rate• Last 18 months of ownership are exempt• Transfer a share to someone to make use of x2 allowances
Mitigating Inheritance Tax
What can you do?• Gifting and spending
• Small gifts• Annual exemption• Wedding/ civil partnership gifts
• Life assurance policies, pensions, death in service benefits • Usually nominated to spouse - aggregate to their estate• Written in trust
• Regular gifts from income• Good records to be kept• Submitted to the Revenue
• Inheritance from parents – do you need it? • Post death variations
• Financial products• AIM shares etc – Take financial advice
Domicile• Succession and inheritance tax in the UK is based on ‘domicile’
rather than residency.• Domicile is a complex area and has implications for:
• Inheritance tax • 17-20 tax years• If non dom, UK assets taxed• If dom – worldwide estate taxed
• Capital gains tax• April 2015 – non doms subject to it• No election for non doms
• Succession of assets on death • Get specialist advice and prepare Wills in both countries.
Lasting Powers of Attorney• Two types – Property and Financial Affairs and Health and Welfare
• Property and Financial Affairs• Running bank accounts• Overseas• Running your business• Managing your property
• Health and Welfare• Can only be used on onset of incapacity• Where you will live• What you will wear• Life sustaining treatment• Next of kin
Any Questions?
Bolt Burdon Solicitors
Please contact us with enquiries:
Iain AitkenE: [email protected] T: 020 7288 4713
Michael CulverE: [email protected] T: 020 7288 4741
Sarah ClackerE: [email protected] T: 020 7288 4747
