Wills and Probate

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.

The person who has made a will.

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

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.

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.

Someone entitled to a fixed gift – a specific amount of money or item(s) of property under the terms of a will.

The document issued by the Probate Registry giving formal approval for representatives to deal with the estate of a person who has died intestate i.e. without leaving a will detailing how they wish their estate to be disposed of.

Sometimes known as Life Interest Trusts, this type of trust is commonly used to ensure a spouse has a home and income for life while ensuring the underlying capital is preserved for the children.

All income must be paid to the beneficiary and they normally have no right to the capital. This type of beneficiary is called the Life Tenant.

If a person dies without making a will their estate is distributed in accordance with the Intestacy Rules. Intestacy is administratively burdensome and can lead to significant delays and expense in the settlement of a person’s estate. It may also mean that a person’s estate is not settled in the way that they might have wanted and should, therefore, be avoided if at all possible.

A document appointing a person of your choice (the attorney) to deal with either your property and financial affairs or your health and welfare decisions when you are no longer capable of doing so, or at a time when you give permission for your attorneys to act.

The Inheritance (Provision for Family and Dependants) Act 1975 enables certain classes of people to make a claim against the estate of the deceased if they feel the deceased’s will does not make sufficient provision for them, or if the deceased died without leaving a will. In these circumstances, a person can make a claim under the Inheritance Act for a financial award from the deceased’s estate.

To bring a claim, a person must be one of the following:

– the spouse / civil partner of the deceased;
– the former spouse / civil partner of the deceased who has not remarried or entered into a further civil partnership;
– living with the deceased for at least two years prior to their death;
– the deceased’s child (which includes an adult child);
– treated as the deceased’s child, including but not limited to someone who was adopted by, fostered by or a step-child of the deceased; or
– being ‘maintained’ by the deceased.

With the exception of a spouse or civil partner, a claimant is only entitled to sufficient financial provision as required for their maintenance.

The tax, currently charged at 40%, that is due when the value of an estate exceeds the threshold for tax free inheritance set by the government. Estates passing between spouses are not subject to IHT.

The document issued by the Probate Registry that gives formal authority for the executors to act in dealing with an estate when someone dies. It gives them the authority to access bank accounts, settle debts, sell assets and distribute the deceased’s estate to their beneficiaries in accordance with the will.

A gift that is deemed as not being fully given away because the person giving the gift has retained some benefit. For example, a person gives a house to their adult children but continues to live in the property rent free.