Legal Jargon

The legal document in which a person sets out how they wish to leave their estate (assets such as house and bank accounts) when they die. A will may also appoint named guardians for the deceased’s children.

The people or entities appointed to oversee the management of property or other assets on behalf of beneficiaries, who might be private individuals, a charity or another type of organisation. In the context of estate administration following a death, trustees will be the people named in a will to manage the money held in trust for the beneficiaries. The trustees are the legal owners of the assets held in a trust and their role is to deal with the assets according to the deceased’s wishes, as set out in the trust deed or their will.

A formal legal structure where property or other assets are held by one or more people for the benefit of another.

Currently, Inheritance Tax (IHT) is payable at 0% on the first £325,000 of an estate. This is called the nil rate band. The value of the estate above this figure is usually taxed at 40%. Any gifts between spouses are exempt from IHT. The transferable nil rate band, introduced in 2007, allows any unused Inheritance Tax nil rate band from a late spouse’s estate to be transferred to the surviving spouse’s estate when they die. This can give the surviving spouse’s estate a combined nil rate band of up to £650,000.

The person(s) appointed in a will to take care of the deceased’s children until they reach adulthood at the age of 18.

Someone who is entitled to a share of whatever is left in the estate after payment of debts and other specific gifts.

The Residence Nil Rate Band (RNRB) is an additional allowance against inheritance tax (IHT) charged on a deceased person’s estate. The RNRB can be offset against the value of a person’s residence so long as it passes to lineal descendants (i.e. children, grandchildren, step-children/grandchildren, adopted children/grandchildren, foster children). The RNRB was introduced in 2017 and currently stands at £175,000. One point to note is that for every £2 that an individual’s estate exceeds £2 million pounds, the available RNRB will be tapered by £1.

The Court that deals with applications for Grant of Probate and Letters of Administration.

A way of giving permission to someone, either temporarily or for the rest of your life, to make decisions and act on your behalf in relation to your personal affairs, usually relating to financial and/or health and welfare matters. Actions taken by your attorney are legally binding and you should therefore take legal advice before granting power of attorney.

A personal injury trust can be set up to hold and manage a person’s damages to ensure that this money is not taken into account for assessment of means-tested benefits or care contributions.

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