Making a Will enables you to plan exactly what will happen to your property (Estate) following your demise. This ensures that those you would like to benefit actually do so, in accordance with your wishes, and at the same time avoiding any possible disputes between relatives. Most importantly is the peace of mind making a Will provides.
A Power of Attorney is a legal document that enables a chosen attorney to look after your affairs or make decisions on your behalf if you are incapacitated. They can only be used in the specific circumstances specified in the document.
A trust is a legal document that helps individuals hold property for the benefit of others. A Will Trust is a trust created in your Will that comes into effect on death. Will Trusts can meet a wide range of objectives that a standard Will cannot:
Protecting an inheritance while providing for the surviving new spouse.
Protecting children/grand children from misuse of funds when they are not ready for a large inheritance.
Protecting disabled beneficiaries as someone you trust will be looking after their financial well-being.
Probate (or Estate Administration) follows the death of someone. If the deceased made a Will, their Executors will need to apply to the Probate Registry for a document called the Grant of Probate (Confirmation in Scotland). It is by this legal document that they are given the right and the authority to deal and distribute the deceased’s estate according to their last wishes.
Generally speaking, if you die your beneficiaries will have to pay 40% tax on anything above £325,000 if you are single, or £650,000 for a married couple/civil partnership. This is the inheritance tax threshold, also called the Nil Rate Band (NRB).
If parents or grandparents pass their main residence to their direct descendants, their estates will benefit from an additional allowance, the Residential Nil Rate Band (RNRB) of £175,000, meaning a total individual allowance of £500,000 or £1,000,000 for married couples or civil partnerships.