What Price Certainty?

03 Aug 2011

Trethowans Partner, Elizabeth Webbe, warns of the dangers of scrimping on professional advice when making a Will.


Once in a while people will tell me that because they are computer literate they can save oodles of money on lawyer’s fees by surfing the internet and finding the legal information they need there. They are right, to an extent, but to get the right answer you need to ask the right questions.


One area fraught with pitfalls is the drawing up of your Will. Those with straightforward circumstances may be tempted to take up the offer of online Will writing services or even go to WHSmith and buy a blank form to complete. What if they get it wrong though? Will writers and DIY Wills are both unregulated so there is no comeback if mistakes are made. Problems only come to light once you have died and by then it is too late.


If you have little to leave then why care? You may have more to leave if you are a widow(er) and you have been advised to write an arrangement into your Wills whereby you protect a share of the family assets from State means testing. If you do not know of this possibility would a website tell you? Care home fees are a significant concern. Not many choose to hand back their State pension or State care funding once they qualify. You cannot insert this arrangement into your Will after one of you dies, so you must seize the chance when you are both still alive, or lose the option.


It does not do to assume that if a couple come to see me bearing the same name, that they are married. Or at least married to each other! This can get complicated, particularly if there are children from a prior relationship. Naturally each will wish to ensure that they look after their current partner (if they die first) but they are also very sure that they do not want their share of the family assets going to that partner’s hopeful next amour! This situation can be managed to the benefit of all concerned with professional advice; a ‘tick box’ only website solution may not allow for that detail.


Some are concerned about a grown up child’s marriage, or mental state or financial maturity. It is possible to protect, but not deprive that child in your Will – but only if you know it can be done because you ask the expert, your lawyer. The same is doubly true if the children are still of school age, when protection is vital.


Which brings me to my specialist subject: ruining the Chancellor’s day! Wills are a hugely effective tax planning (saving) tool, and the opportunities afforded are legal, tried and tested. You are not going to get that sort of advice from someone who has taken a month long ‘Will writing’ correspondence course.


The lack of a Will brings its own special trials. A divorce does not invalidate the whole Will, just parts of it. A marriage revokes a Will immediately just at a time when you are about to fly off on honeymoon. Not perfect timing. This can be addressed with advice.


Not having a Will can mean your spendthrift child (or their spouse) inherits the means with which to indulge his/her “Rolex Oyster/Jimmy Choo” habit and the grandchildren miss out. It can also mean that your spouse can end up sharing the inheritance with your children who are entitled to their share at the age of 18, just when they are particularly vulnerable to the ‘friends’ they soon acquire.


There is also the foreign element. Some of us like abroad so much we decide to buy some of it. This is great until the local laws there decide they can dictate who inherits that property. For example, in France it is sufficient, while in France, to hand write, in French, your Will, sign and date that paper and “job done”. No witnesses required, but we need to remember that the French also have the Code Napoleon and the concept of ‘forced heirship’ which means that the children are automatically entitled to a share, which can be awkward, especially if they are children of a previous marriage and there is no love lost. This is how 14 people can end up owning the same field in France. This can be managed, as long as you have the right advice.


I sometimes advise a couple to marry, particularly if they have co-habited for decades. Co-habitants have very limited rights of inheritance regardless of considering themselves married in all but name. Once married the security issues and a lot of the adverse Inheritance Tax issues melt away and the Will can ensure that any prior family do not suffer. In a 20-year career, I am quietly proud to say that to date, I am responsible for seven marriages. Perhaps I have a second career?


For those who are widowed and remarry there are enhanced Inheritance Tax planning opportunities available. No website will ask that question.


Finally on a topical note, to our war wounded. If members of our armed services die in combat or directly or indirectly from war related wounds or conditions, even if it is decades later, there is a 100% Inheritance Tax exemption on their assets. This can affect materially the terms of their Will.


The choice is simple. The price of scrimping on professional advice can be disastrous and without remedy.


This article has been published in Wiltshire Life on 4th August 2011.