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News - 21 December 2011

It’s nearly New Year, so, should you make a will?

I know it’s a morbid subject for the season of good will, but Christmas also heralds the start of a New Year, New Prospects, a New Start.

Also it is the time to think of the family.

If you die intestate, your money could end up with the ‘wrong’ people.

For example, unmarried couples (who are not in a civil partnership) have virtually no rights whatsoever. In a legal sense, there is no such thing as a common law marriage.

What are the facts?

If you have no will:

And die leaving a surviving spouse or civil partner and children the spouse/civil partner is entitled to £250,000, the deceased’s personal possessions and a life interest in half of the residue of the estate. The children will be entitled to half of the residue immediately and the other half on the spouse’s death.

If you leave a spouse or civil partner but no children the spouse / civil partner is entitled to £450,000 and all personal possessions plus half of the residue immediately, with the other half going to increasingly remote relations.

If there are none, the money goes to The Crown.

If there is a spouse or civil partner but no siblings, nephews or nieces, they will be entitled to the whole estate.

If you die unmarried, but have children, the children will be entitled to the whole of the estate equally (or their children if they die first).

If you die unmarried, with no children, the whole of the estate will pass to your relatives ranging from parents, through siblings to more remote relations.

If there are none, the money goes to The Crown.

Dying intestate highlights the need for unmarried couples or families with step children (who are only covered by automatic entitlements if adopted by the person who dies) to make a will. Otherwise they are not provided for under the intestacy provisions.

Is it expensive?

The cost of planning need not be high; but the cost of not doing so could be expensive for those you care most about.

Planning who gets your money also allows you to plan to minimise the potential impact of inheritance tax on your estate. After all, you could well become a 40% taxpayer when you die, if your estate is more than £325,000 (up to double for a married couple or civil partners).

If you need any help and advice on Inheritance tax, capital gains Tax, or any other implications with Stocks and Shares, don’t hesitate to contact Lavinia Newman, Stuart Coleman or Tonmoy Kumar to discuss how ABDS can help in all your financial planning.

ABDS Chartered Certified Accountants of Southampton.
Tel: 023 8083 6900  E-mail: abds@netaccountants.net

 

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