Trusts – are they still useful?

Recent years have not been kind to trusts because government has come to the conclusion that they are a bad thing used by tax avoiders and as receptacles for ill-gotten gains.  That of course is true in some cases but there are many situations where a trust could be useful.  They are still an effective way to protect assets for future generations.  There are different types of trust.  Perhaps the most common are discretionary trusts and bare trusts. A bare trust is very like a nominee rel Continue reading

Latest IHT statistics

There was a good article by Merryn Somerset Webb in the weekend FT pointing out the advantages in making a will and the risks of intestacy; and also some interesting comments on digital assets and new tech-based services in the field of looking after those assets and dealing with what happens to them on death.  Cheerful! She drew attention to the latest statistics on inheritance tax.  In 2016/17 28,100 estates paid the tax which was 15% more than the previous year.  The proportion of estat Continue reading

IHT Spouse Exemption – Key Facts You Need to Know

When it comes to writing your Will and planning division of your estate, it’s important to have a good understanding of UK inheritance tax laws. Making the right financial decisions now will not only ensure financial security for your spouse, but will also future proof your assets for children and other dependants. In this post, we’ll examine inheritance tax rules and exemptions for spouses and civil partners, and look at what Continue reading

IHT Compliance Checks by H. M. Revenue and Customs

According to recent information released by HMRC more than 5,000 inheritance tax cases are opened for investigation each year representing about one quarter of estates that pay inheritance tax. Dealing with these compliance checks can be complicated and time consuming. At Probaters we have considerable experience in dealing with such investigations and if you are an executor or administrator and you think you need help, please do not hesitate to contact us.

Financial Provision Claims

Where a person thinks a valid will or intestacy has resulted in unfairness he or she might consider making a claim under The Inheritance (Provision for Family and Dependants) Act 1975 – commonly known as the 1975 Act. The categories of claimants under the 1975 Act include husbands and wives and civil partners of the person who dies; anyone who for the last two years of the deceased’s life was living in the same household as their husband or wife; a child or a child treated as a chil Continue reading

Contested Estates

The number of inheritance disputes reaching court appears to increase each year. Often cases attract media attention with great human drama stories. The reality is usually more mundane. Changes in society mean that there are more complex family structures in place and this can make the division of assets between first, second and even third families seem contentious and create feelings of ill will.

Increasing property prices have also meant that what used to be small or mo Continue reading

Is a Power of Attorney a Good Idea?

It certainly is according to recent reports from financial advisers and dementia charities.

Apparently the number of people with dementia in the United Kingdom is set to rise from 850,000 to 1,000,000 by 2025 and to 2,000,000 by 2051. If there is no lasting power of attorney and a person has lost mental capacity to handle his or her own affairs, a deputy is appointed to manage their financial affairs. This could be a friend or a solicitor but it is the Court of Protection Continue reading

Taper Relief and the 14 Year Rule

These are two topics which can cause great puzzlement to executors and administrators.  The recent Government report is worth quoting at length on both these topics.

Taper relief is complicated and not well understood

The tapered rate of Inheritance Tax on lifetime gifts is poorly understood.  The OTS has heard that advisers find it difficult to explain taper relief to clients and that many individua Continue reading

Executors and Charitable Legacies

Executors are sometimes surprised when they obtain a grant of probate and almost immediately receive a letter from a charitable beneficiary reminding the executor of his or her duties and the fact that the charity will be looking for some money. The charities were so well informed because a firm called Smee & Ford had a lucrative contract with the Government. For many decades they had paid the probate service an annual fee and in return received copies of all wills which were submit Continue reading

Simplifying IHT

The recent publication by The Office of Tax Simplification of the second part of its report on inheritance tax made the headlines in most papers. The most quoted point was the suggestion that the period for the exemption of life time gifts should be reduced from 7 years to 5 years. The Office’s research showed that executors had great difficulty in assembling records for a 7 year period and that often banks do not keep bank statements going that far back. The reduction would be a welc Continue reading