You’ve worked hard to build up the property and/ or savings you have now. Various events could threaten that and you may want to guard against them. Here are some situations we can try to guard against by arranging the appropriate paperwork.
This is a big topic so visit the inheritance tax page containing more information on
- The transferable nil rate band
- IHT relief on business property
- Placing pension benefits and life policies into trust
- Creation of lifetime trusts
- Exemption for gifts out of income
- Leapfrogging the generations
Paying for Care in the Future
For many people who are not wealthy enough to be troubled by inheritance tax, this is the biggest worry. Most people know that, if you become frail in old age and can no longer live at home, the value of your home is at risk if it is left empty.
For people of modest wealth, who have worked hard to build up this asset, this prospect is very distressing. Some people attempt to give their house away to their children while they are still well, in the hope that it will escape the means testing net. This should only be done after very careful advice from a specialist solicitor such as myself. There are a number of tax implications and you could be left very vulnerable if you are not properly advised. If you are a couple, there are ways of arranging your wills so that the amount that can be means tested once one of you in widowed is kept to a minimum.
A lot of people put off making or re-making their wills after they have married for a second time, especially if they have children by their first marriage, because they just cannot work out what best to do. The problem is that, if you leave everything to your second spouse or own things jointly together, there is no guarantee that the benefit will eventually go down to your children.
It is possible to use trusts in the will so as to give the surviving spouse security during widowhood, while still preserving the rights of the children once you have both died. Not everyone wants to get into trusts, because they can limit the survivor’s freedom of action and the pros and cons should be discussed with an experienced solicitor who is used to helping people weigh this up. Your initial no obligation meeting with me should give you the chance to make a start on that process and see if you want to take it further.
A Vulnerable Future?
Sadly, I come across a few cases every year where someone who has led a full and independent life suddenly becomes frail and relatives, friends or neighbours take it upon themselves to get involved. Often these people do a wonderful job. Sometimes however they are careless or ill informed or, unfortunately, downright criminal. You can guard against this by choosing the right person yourself. Visit the section on Lasting Powers of Attorney to find out more.
Family Problems – Insolvency and Divorces
With nearly one marriage in two ending in divorce and the current economic climate resulting in a number of insolvencies, both these are real problems. Parents understandably worry about their death coinciding with one of these events and their hard earned cash ending up on the wrong side of a divorce settlement or being lost to creditors.
As with many things, trusts are the answer. Don’t be afraid of them. They don’t have to be complicated and they have been developed in English law over centuries to preserve assets within the family. We can explore the possibilities within our initial no obligation meeting.
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