Wills and inheritance tax - by independent financial adviser John Bramwell

Wills

Why do I need a will?

If you do not have a will, when you die your estate will be distributed according to the Laws of Intestacy. If you have a spouse but no other relations (children, parents, brothers and sisters, etc.) then your spouse will inherit your whole estate.

However, if you have other relations the situation becomes far more complicated and your estate may not go where you or your family might expect. In these circumstances, it is possible that your spouse may not inherit enough to live off or may have to sell the family home.

Legally adopted children and illegitimate children (providing parentage is proven) are treated the same as natural children.

The property of someone who is divorced does not go to the ex-spouse under intestacy rules.

Can a Will reduce taxation for my family?

Wills are used in Inheritance Tax (IHT) planning. On death, some or all of the deceased person's assets can be placed in trust.

An example is when married couples arrange in their wills to bequeath assets into trust. This can have the effect of preventing the assets from falling into the estate of the surviving spouse.

Where can I get advice on these matters?

Wills are best drawn up by an expert, such as a solicitor or qualified will writer (although simple draft wills can be purchased from stationers). This is because the process of drawing up the will often raises issues that need specialist advice.

It is advisable to have a full financial review by an independent financial adviser before you make a will. This is so that you can be certain that investments, tax issues and protection measures are considered. For example, this review could arrange for life policies to be placed in trust and IHT mitigation considered.