When famous actor Rik Mayall died last June intestate (without a Will), his family had to pay an unexpected inheritance tax bill. With an estate valued at £1.2 million, the family of Rik Mayall are facing an IHT liability of up to £60,000. With this mind, it is also important to note that you do not need to be a wealthy celebrity to leave your family with an unexpected and unnecessary IHT bill.
According to research conducted from Macmillan Cancer Support, an estimated 1 million Britons have had a serious family argument after a relative passed away without leaving a Will. Out of these 1 million Brits, nearly a fifth had said that the row had gone on to break up the family.
It seems however, that despite the dangers of dying intestate, almost 6 out of 10 UK adults have failed to set out exactly how they want their estate to be divided once they pass away. The main reason given for this was that they "just never got round to it".
In addition to the research conducted, 1 in 3 people who have already written a Will failed to include something they had promised to a loved one. Many have argued that dying intestate can also pile financial stress onto grief. Making a Will does not have to be expensive but it essential in helping to avoid family breakdowns and legal issues once you pass away.
In terms of IHT payments, research from the website Unbiased.co.uk has shown that Britons wasted £550 million in 2015 on unnecessary IHT payments by failing to make plans. Many have suggested that this vast amount of wasted money is due to a combination of an improving economy and rising house prices which may have resulted in more estates exceeding the £325,000 threshold.
Yet to come into force however, during the 2015 general election, the Tories pledged a new allowance relating to family homes which will effectively take the IHT threshold per couple to £1 million. Currently, everybody can leave £325,000 worth of assets tax-free. Anything above this amount will incur a 40% tax.
To find out more about making a Will or about Inheritance Tax simply click here.
Showing posts with label dying intestate. Show all posts
Showing posts with label dying intestate. Show all posts
Wednesday, 3 June 2015
Thursday, 12 March 2015
Don't have a Will? Neither does 73% of the UK.
With January and February gone and March passing us by, its time to ensure that your Will is set up and says exactly what you want it to say for when you pass away. And for those of you who have a Will, when was it last updated and is it actually valid?
Latest statistics from the Law Society has revealed that the majority of people in the UK do not a have a Will. Results showed that a staggering 73% of 16-54 year olds do not have a Will, whilst 64% of over 55 year olds do. In addition to this, men are also more likely to make a Will than women.
The main reason given for not making a Will, is that they believe they have nothing of any value to leave. However, many people forget to account for their property when adding up the value of their estate.
Out of those who have a Will set in place, 47.2% stated that their reason for making a Will was due to the fact that they were now old enough or realised the negative impact by not having one. Many people were also revealed to have made a Will as a result of a divorce.
Divorces are often a common reason behind people creating a new Will or changing a Will through a Codicil.
Dying intestate (without leaving a Will), can often be a nightmare for the family members involved. As many as 23% of those surveyed believed that if they passed away without making a Will, their estate would automatically go to their family. This however is incorrect as in some cases intestacy rules will determine who inherits what. In some cases, the state may be entitled to the estate. In 2014, around £8m was received by the government due to those passing away without an estate.
So what are the Intestacy rules?
If you pass away without leaving a Will in both England and Wales, your property will be divided and distributed under the intestacy rules in the Administration of Estates Act. These rules were updated after new regulations came into force on 1st October.
If you are married or are in a civil partnership and you have children, the surviving spouse/partner will receive everything including personal possessions up to the value of £250,000. Anything above this value is then divided equally between the children when they reach 18 years of age and the spouse/partner.
If you are married or are in a civil partnership and you have no children, the surviving spouse/partner will receive everything.
If you are unmarried and have children, your children will receive everything once they reach 18 years of age. If you are cohabitating, your surviving partner will get nothing.
If you are unmarried and have no children, your estate will go to your relatives in the following order:
Inheritance Tax?
Making a professional valid Will can also reduce the amount of inheritance tax you will have to pay. Inheritance tax, is the tax payable on a property once you pass away. However, some can be passed on tax-free via the 'nil rate band'. The nil rate band for 2015 is £325,000.
Married couples and civil partners can pass on their property to each other tax-free. As from 2007, the surviving partner can use both tax-free allowances, providing one was not used at the first death. This means that the amount the surviving partner can leave behind is tax free up to £650,000.
If you're thinking of making a Will, the LawStore can help you! The LawStore offers a wide range of affordable and easy to use legal documents regarding your Will. For further information simply click here. If you would like to speak to an expert in regards to making or changing a Will call us on 0845 603 6544, for further information and advice.
Latest statistics from the Law Society has revealed that the majority of people in the UK do not a have a Will. Results showed that a staggering 73% of 16-54 year olds do not have a Will, whilst 64% of over 55 year olds do. In addition to this, men are also more likely to make a Will than women.
The main reason given for not making a Will, is that they believe they have nothing of any value to leave. However, many people forget to account for their property when adding up the value of their estate.
Out of those who have a Will set in place, 47.2% stated that their reason for making a Will was due to the fact that they were now old enough or realised the negative impact by not having one. Many people were also revealed to have made a Will as a result of a divorce.
Divorces are often a common reason behind people creating a new Will or changing a Will through a Codicil.
Dying intestate (without leaving a Will), can often be a nightmare for the family members involved. As many as 23% of those surveyed believed that if they passed away without making a Will, their estate would automatically go to their family. This however is incorrect as in some cases intestacy rules will determine who inherits what. In some cases, the state may be entitled to the estate. In 2014, around £8m was received by the government due to those passing away without an estate.
So what are the Intestacy rules?
If you pass away without leaving a Will in both England and Wales, your property will be divided and distributed under the intestacy rules in the Administration of Estates Act. These rules were updated after new regulations came into force on 1st October.
If you are married or are in a civil partnership and you have children, the surviving spouse/partner will receive everything including personal possessions up to the value of £250,000. Anything above this value is then divided equally between the children when they reach 18 years of age and the spouse/partner.
If you are married or are in a civil partnership and you have no children, the surviving spouse/partner will receive everything.
If you are unmarried and have children, your children will receive everything once they reach 18 years of age. If you are cohabitating, your surviving partner will get nothing.
If you are unmarried and have no children, your estate will go to your relatives in the following order:
- parents
- brothers and sisters (if parents have passed away)
- grandparents (no brothers or sisters)
- aunts and uncles (no grandparents)
- the crown (no living relatives)
Inheritance Tax?
Making a professional valid Will can also reduce the amount of inheritance tax you will have to pay. Inheritance tax, is the tax payable on a property once you pass away. However, some can be passed on tax-free via the 'nil rate band'. The nil rate band for 2015 is £325,000.
Married couples and civil partners can pass on their property to each other tax-free. As from 2007, the surviving partner can use both tax-free allowances, providing one was not used at the first death. This means that the amount the surviving partner can leave behind is tax free up to £650,000.
If you're thinking of making a Will, the LawStore can help you! The LawStore offers a wide range of affordable and easy to use legal documents regarding your Will. For further information simply click here. If you would like to speak to an expert in regards to making or changing a Will call us on 0845 603 6544, for further information and advice.
Thursday, 5 March 2015
Are DIY Wills really worth it?
Making a Will is essential to ensuring that your savings and assets are distributed according to your wishes. However many people in the UK fail to make a Will due to the sadness of the subject and due to the cost. On a whole, solicitors will charge between £100 and £300, with a £600 plus fee for inheritance tax advice or for other complex planning.
However, in contrast to this, DIY Wills offer a cheaper alternative, usually costing around a mere £20. Some have suggested that with just a quick look online, you will find a wide range of DIY kits to help you make a Will.
Whilst this 'off-the-shelf' option may seem more attractive due to its price, many argue that this is a risky approach. Using a DIY Will, comes with many risks such as errors and if strict witnessing rules are not followed correctly, your Will document could become invalid.
These types of errors can have serious implications and can often lead to your estate being eaten away by legal bills or unnecessary tax. A report from the Co-operative Legal Services has revealed that poorly drafted or ineffective DIY Wills caused a prolonged probate ordeal for 38,000 families a year. As a result, up to 10% of the value of a persons estate is then taken away by additional fees incurred by an ineffective Will. So with the average estate in the UK standing at £160,000, around £16,000 would be wasted away to probate fees.
If you are looking for a solicitor to help you with your Will, it is advised that you choose a Wills and Probate Solicitor who is accredited with the Law Society. Will writing services are also available from other providers, however before instructing them it is essential that you ensure they are governed by a regulatory body such as the Solicitors Regulation Authority.
So what are the rules of Intestacy?
If someone dies intestate (without a Will), the persons estate is then distributed according to the rules of intestacy. In October 2014, these rules where changed for the first time since 1925 in order to simplify the old system. One of the biggest changes made was for couples who are married or are in a civil partnership but have no children, will now inherit the entire estate if their partner dies intestate.
Under the new rules and when children are involved, the surviving spouse or civil partner will get:
For further information and advice on Wills and Probate visit willsandprobate.mtasolicitors.com
However, in contrast to this, DIY Wills offer a cheaper alternative, usually costing around a mere £20. Some have suggested that with just a quick look online, you will find a wide range of DIY kits to help you make a Will.
Whilst this 'off-the-shelf' option may seem more attractive due to its price, many argue that this is a risky approach. Using a DIY Will, comes with many risks such as errors and if strict witnessing rules are not followed correctly, your Will document could become invalid.
These types of errors can have serious implications and can often lead to your estate being eaten away by legal bills or unnecessary tax. A report from the Co-operative Legal Services has revealed that poorly drafted or ineffective DIY Wills caused a prolonged probate ordeal for 38,000 families a year. As a result, up to 10% of the value of a persons estate is then taken away by additional fees incurred by an ineffective Will. So with the average estate in the UK standing at £160,000, around £16,000 would be wasted away to probate fees.
If you are looking for a solicitor to help you with your Will, it is advised that you choose a Wills and Probate Solicitor who is accredited with the Law Society. Will writing services are also available from other providers, however before instructing them it is essential that you ensure they are governed by a regulatory body such as the Solicitors Regulation Authority.
So what are the rules of Intestacy?
If someone dies intestate (without a Will), the persons estate is then distributed according to the rules of intestacy. In October 2014, these rules where changed for the first time since 1925 in order to simplify the old system. One of the biggest changes made was for couples who are married or are in a civil partnership but have no children, will now inherit the entire estate if their partner dies intestate.
Under the new rules and when children are involved, the surviving spouse or civil partner will get:
- all the property of the person who passed away
- the first £250,000 of the estate
- 50% of the remainder of the estate
- remaining assets are held for the deceased's children
For further information and advice on Wills and Probate visit willsandprobate.mtasolicitors.com
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