Frequently Asked Questions
What is a Will?
Why do I need to make a Will?
What happens if I don't make a Will?
What can I say in a Will?
What can't I leave in a Will?
What about jointly owned property?
What is a mirror Will?
What about gay or lesbian couples?
What is an executor?
What is a guardian?
Where should I keep my Will?
What if someone I leave a gift to in my Will dies?
Who can dispute a Will?
When should I review my Will?
Will inheritance tax be payable?
What is a Will?
A Will is a legal document in which you state what you would like to happen to your estate. Your estate consists of your house (less any outstanding mortgage or other loans secured on it), cash and savings, your car, household and personal effects, proceeds from any life assurance policies and pensions where there isn't a named beneficiary or the plans are not written in trust LESS any outstanding loans, credit card balances, household bills, funeral expenses, etc.
If the gross value of the total estate is less than £5,000 (England, Wales & Northern Ireland) or £25,000 before debts (Scotland) it is called a "small estate" and in many cases it can be distributed without a Grant of Probate or Confirmation of the Estate.
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Why do I need to make a Will?
Because making a Will enables you to choose exactly what happens to all of your assets by specifying how these are to be distributed after you have died. Making a Will also gives you the peace of mind knowing that you have yourself chosen who gets what and it considerably simplifies the required formalities and reduces costs at a very stressful time for your family or friends.
It doesn't matter how little you think you are worth, it is still important that you make a Will. Without a Will, your relatives and friends could face severe difficulties because the law will then decide what happens to your estate and this may not be what you would have wished. You must sign and date your Will in the presence of two witnesses who must then both sign in your presence (England, Wales and Northern Ireland) or one witness (Scotland).
You must appoint an executor in your Will to ensure the terms of your Will are carried out. Sometimes one executor is sufficient but where there are potential beneficiaries who are not yet 18, then two executors are advisable. The executor's role is explained further below.
Your Will is an invaluable opportunity for you to clearly let your intentions be known relating to:
1) Who you wish to act as executor(s) of your Will
2) Who should act as guardians to look after your minor children in the event of your death (if the other parent is unable to do so) and how you wish to provide for your children's upkeep
3) How you would like your funeral conducted
4) Whether you wish to donate your organs or donate your body for medical research
6) How to provide for your pets or favourite charity
7) Who you wish to receive what of your personal items, investments and or property. Whether the gift has real value like your house or only has sentimental value like a watch or wedding ring.
Without a valid Will it can take months or sometimes even years to sort out your affairs and in the meantime your surviving dependants (either a spouse or a partner or a child) have all the usual household expenses and possibly no access to any money because all of your income may be frozen until everything has been sorted out. If you have left a Will it shouldn't take more than two or three months at most to sort everything out and for your executors to release your assets to the people of your choice
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What happens if I don't make a Will?
It is a fact that nearly two-thirds of Britons die without leaving a Will. Many people assume, quite wrongly, that if a husband or wife dies their estate automatically passes to their spouse. In fact, a substantial amount may go to other relatives. (The term “spouse” used throughout these notes also includes any person who is registered as a civil partner as defined by the Civil Partnership Act 2004)
If you don't make a Will your estate (i.e. your personal belongings, property, savings etc.) will be distributed to your next of kin after the payment of any debts according to the laws of intestacy regardless of your personal wishes and/or your relationship to that person or persons at the time of your death. This could mean that your spouse might not receive the whole of your estate, or an unmarried partner might not receive anything, and/or you might be liable to unnecessary tax.
To see a chart showing how assets and belongings are distributed according to the laws of intestacy click here
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What can I say in a Will?
When you make a Will you can say how you would like your financial affairs to be dealt with after your death. You can also add any personal comments and if you wish, choose whether you want to be buried or cremated. You can decide if you would like a formal service and if so specify where it should be held. You can also choose if there should be a sermon or any particular hymns. Your Will does not have to be a long and complex document and it should always be as clear and simple to understand as possible.
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What can't I leave in a Will?
It may seem obvious but you can't leave anything in a Will that you don't own!
Usually this includes 3 main categories:-
1. Jointly Owned Property
If you jointly own property with someone else as joint tenants then upon your death your share automatically goes to the surviving co-owner. It does not therefore form part of your estate and cannot be left to anyone in a Will. (See also “What about joint property below)
2. Life Policies
If you have a life insurance policy that is drawn up on trust for someone else so it will not become part of your estate when you die. For this reason you do not need to mention it in a Will.
3. Pensions
In exactly the same way as any life policies pension rights may also pass outside a Will (or end on your death) so they do not need to be mentioned either. You may however be able to nominate who should receive any death benefits payable under a pension arrangement and you should consult with your pension provider on this point.
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What about jointly owned property?
Many people don't realise that if they own property (i.e. land/buildings) jointly with someone else as "joint tenants" (e.g. most married couples own jointly owned property as joint tenants) then their "share" of that property automatically passes to the other person upon death and does not form part of his or her estate. There is therefore no need to make any mention of that "share" of a property in a Will or any purpose in doing so.
However, if you own a share of a property as "tenants in common" (e.g. this is more likely in the case of an unmarried couple) then you can leave your share of that property to whoever you want in a Will (e.g. to the other co-owner). If you are in any doubt as to how your property is owned and/or you want to change the way that you own it you must seek legal advice.
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What is a mirror Will?
A mirror Will is when a husband, wife or partner make almost identical Wills leaving everything to each other if one of them dies and then, when they have both died, to their children (if any) or, if there are no children, to someone else.
Technically there is no such thing as "a joint Will" - there must be two completely separate legal documents although they will both have very similar contents that "mirror" each other.
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What about gay or lesbian couples?
Gay and lesbian couples who have registered their partnership in accordance with the provisions of the Civil Partnership Act 2004) have the same rights under intestacy and inheritance tax reliefs as a married couple.
It is particularly important for gay or lesbian couples who have not registered their partnership to make a Will because only married people and those in a registered civil partnership are recognised as "couples" under the present law. Gay partners who are not in a registered civil partnership have no legal standing no matter how long they have lived together so unless they each make a Will setting out their wishes their assets will not go to each other but will automatically pass to the surviving members of their family (i.e. brothers/sisters or parents) under the rules of intestacy.
The easierWills programme has been designed to be used equally by either married, unmarried or gay or lesbian couples.
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What is an executor?
Your executors are the people who will deal with your estate after your death. They will collect in your assets, pay all your debts and any inheritance tax, deal with any specific legacies that you have left and then distribute the remainder of your estate in accordance with your wishes.
If you have any children they will also act as trustees to look after monies until they are old enough to inherit and they will also be able to use the trust money to help support them in the meantime. Your Will automatically includes The Standard Provisions of the Society of Trust and Estate Practitioners (1st Edition) which give your executors and trustees all the necessary powers that they will need to administer your estate properly and efficiently. In particular the provisions allow your trustees to use monies under their control for the welfare and upkeep of your children. To see the full Standard Provisions click here
You can appoint up to four executors including one of the beneficiaries e.g. your spouse/partner (it is common for a Will to appoint a main beneficiary as an executor). If you appoint your spouse/partner they can act on their own (with reserves appointed to act if they die before you) or jointly with another person or persons
We recommend that you appoint at least two executors in case one of them is unable to act for whatever reason.
Make sure that your chosen executors are prepared to act because they cannot be forced to do so.
When your Will is completed it should be kept in a safe place and you must tell your executors where it is stored.
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What is a guardian?
When making a Will you need to consider who should be the guardians of any children under the age of 18 years who may survive you. Usually the appointment of a guardian or guardians takes effect on the death of the second parent.
The duties of a guardian are similar to those of a parent. They are responsible for the day to day upbringing of your child as if he/she was their own. Normally it is best to appoint two members of your family as your guardians who are living together in a stable relationship but if the children are grown up it may, depending upon your own personal circumstances, be more appropriate to appoint close friends.
Don't worry about leaving any money to the guardians for the purpose of enabling them to carry out their duties. Your executors (who should not be the same as the guardians) will be able to authorise the use of any monies that you have left to the children for their benefit until they are old enough to inherit.
You should tell the proposed guardian of your intention to appoint them to ensure that they are willing to take on the responsibility of looking after your children if this becomes necessary.
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Where should I keep my Will?
There is no formal requirement as to where a Will should be stored but obviously it should be kept in a safe place that is easily accessible.
It is not advisable to keep a Will in a safety deposit box because after your death your executors will have difficulty in gaining access
You should always make a copy of your Will (which should clearly be marked "copy" on all pages) and make a note on the copy where the original is kept. Tell your executors where you have kept your Will and give them a letter of instruction regarding any matters that you do not wish to include in your Will (but do not staple or attach this to the Will in any way)
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What if someone I leave a gift to in my Will dies?
If when making a Will you leave a gift of an item or money to someone who is not a child or grandchild of yours who then dies before you that gift goes back into your estate as if it had not been left to anyone in the first place. If it is a child or grandchild then, in the absence of a contrary intention shown in the Will, the gift will pass to their issue.
If they die before they receive their legacy but survive you by more than 30 days then they will receive their gift posthumously and it will then form part of their estate.
However if someone who you leave a gift to fails to survive you by more than 30 days then their share is divided among the other beneficiaries in the same proportion to each other as before.
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Who can dispute a Will?
Very few Wills are ever disputed but a spouse, former spouse (who has not remarried), child, grandchild, parent and "common law husband/wife" may all be able to make a claim if they believe that they are entitled to more, or that they were omitted without reason, or that your wishes have been misinterpreted or misunderstood. In general, with the exception of a spouse, anyone making a claim against your estate would have to show that they were to some extent financially dependant upon you.
If you omit any of the above without a clause giving your reasons either in the Will itself or in a signed statement that you give to your executors a Court might decide that their omission was an unintentional oversight.
To get a Will invalidated for any other reason someone would have to go to Court to prove:
a) that you were of unsound mind or,
b) you were unduly influenced by someone else or,
c) your signature was forged or,
d) the Will has been altered or tampered with in some way.
To prevent any disputes always try to make sure that a Will is clearly written, that it is not ambiguous in any way and that your wishes are clear and concise.
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When should I review my Will?
Generally you should review your Will every time a "life event" happens. For example if you separate from your spouse or partner, if you have a child, if there is a death in your family, if a beneficiary or executor or guardian dies, if there is a change in your financial circumstances, if there are changes in the types or rates of taxation, or if you are going to live abroad.
In particular it is important to know that you should make a new Will if you marry or remarry or enter into a civil partnership because any previous Will is then automatically revoked unless it contains a clause that says it is being made in expectation of marriage or civil partnership (the easierWills programme offers this option). Although getting divorced or dissolving a civil partnership does not automatically revoke a Will any clause that refers to a former spouse or civil partner will no longer be valid and if he or she is named as an executor then they will not be allowed to act.
For all of the above reasons easierWills has made it simple for you to update your Will at any time in the future. All of the information contained in your most recent Will is always securely stored on our site so with your own username and password (and for a nominal fee) you can easily make changes (without having to go through the whole process) whenever you want.
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Will inheritance tax be payable?
Any assets passed to a husband or wife (or a civil partner) are exempt and the first £325,000.00 of your estate (the Nil Rate Band) will also be free of inheritance tax but everything above that figure will be taxed at 40% so, for example, if the net value of your estate is £400,000.00 inheritance tax will be payable on £75,000.00 (i.e. 30,000.00 tax)
When considering whether any inheritance tax will be payable on your estate you should add up all of your assets e.g. property, savings, stocks and shares, premium bonds etc. and then deduct any liabilities e.g. mortgage, credit cards, loans etc.
Remember not to include anything that will not form part of your estate e.g. life policies that are written in trust and death benefits payable under pensions arrangements. Certain types of business assets and agricultural property may qualify for relief from Inheritance Tax. The rules covering these are complex and not within the scope of these guidance notes. If you own business assets or agricultural property you will need to seek further professional advice.
If your net estate is more than £325,000.00 tax will also be payable on any gifts (exceeding more than £3000 in total in any tax year) made within 7 years of your death but again this does not include anything given to your spouse or civil partner.
It is important to know that all gifts to a registered charity are tax free and there are also tax allowances for some gifts of agricultural or business interests.
Important
Since October 2007, you can transfer any unused Inheritance Tax threshold from a late spouse or civil partner to the second spouse or civil partner when they die. This can increase the Inheritance Tax threshold of the second partner - from £325,000 to as much as £650,000 in 2009-10, depending on the circumstances.
How does the transfer work?
Everyone’s estate is exempt from Inheritance Tax up to a certain threshold: £325,000 in 2009-10. ( the ‘nil rate band’).
Married couples and registered civil partners are also allowed to pass assets from one spouse or civil partner to the other during their lifetime or when they die without having to pay Inheritance Tax - no matter how much they pass on - as long as the person receiving the assets has their permanent home in the UK. This is known as spouse or civil partner exemption.
If someone leaves everything they own to their surviving spouse or civil partner in this way, it's not only exempt from Inheritance Tax but it also means they haven't used any of their own Inheritance Tax threshold or nil rate band. It is therefore available to increase the Inheritance Tax nil rate band of the second spouse or civil partner when they die - even if the second spouse has re-married. Their estate can be worth up to £650,000 in 2009-10 before they owe Inheritance Tax. (The size of the estate of the first to die is irrelevant - it can in fact be NIL. It is the amount of the nil rate band that is used that determines what amount can be transferred)
To transfer the unused threshold, the executors or personal representatives of the second spouse or civil partner to die need to send certain forms and supporting documents to HM Revenue & Customs (HMRC). HMRC calls this ‘transferring the nil rate band’ from one partner to another.
When can the threshold be transferred?
The threshold can only be transferred on the second death, which must have occurred on or after 9 October 2007 when the rules changed. It doesn’t matter when the first spouse or civil partner died, although if it was before 1975 the full nil rate band may not be available to transfer, as the amount of spouse exemption was limited then. There are some situations when the threshold can't be transferred but these are quite rare.
And finally
Anyone who thinks that their taxable estate will exceed £325,000.00 (or £650,000 where the nil rate band is transferrable) should consider more specialised Inheritance Tax Planning because a standard online Will prepared by easierWills may not be suitable.
If you would like us to call you back to arrange for someone to contact you to discuss this please click here
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