Relying on an inheritance from a family member is becoming an important part of financial planning for many people. A report by Sanlam UK revealed that 64% of people aged between 25-45 expect to receive inheritance from parents and grandparents so are putting off saving as a result.
Therefore, it is no surprise that in a recent survey conducted by insurer Direct Line, showed that 1 in 5 (21%) of the people surveyed in London would consider contesting their parents Will. There were more than 8,000 ‘caveats’ registered in attempts to block probate in 2017 according to Direct Line. Some of the reasons for these challenges to probate were concerns related to the deceased being of sound mind when they made a Will and whether the person who applied for probate should have been the one to do so.
I always recommend that clients review their Wills to make sure they reflect their current wishes as part of the ongoing annual review service that I provide. It is also important to consider the implications that changes in family’s circumstances and legislation may have on the desired distribution of an estate when the time comes. This is part of the regular planning that is needed to ensure that my clients are on track to meet their goals for the future.
Reviewing your Will also gives you an opportunity to consider your wider circumstances and the potential impact that areas such as inheritance tax may have on any decisions you make. In 2017/18, the inland revenue made over £5.2bn from inheritance tax and this figure is expected to increase. Bearing this in mind, you may need to consider the impact a large inheritance tax bill could have on the distribution of your estate.
One important way to ensure that your wishes are carried out, without the concern of potential challenges to your Will, would be start planning for this eventuality now. Consider what you would like to happen to your estate? Are there any potential inheritance tax implications? Inheritance tax could be seen as a “voluntary tax”, simply because you have so many options when it comes to mitigating this liability. You may be surprised by the range of options you have at your disposal and having this conversation now, will help clarify your plans and provide you with peace of mind. Having an up to date Will, that is professionally written, is a vital part of this estate planning.
If you have not reviewed your plans recently or would like to discuss your options regarding inheritance tax, please do not hesitate to contact me and I’ll be happy to discuss our financial planning service.
