Most of our advice to date has focused on how to support your business during COVID-19 but following our email last week about Wills our private client team has been working closely with our clients and their family members to ensure their personal affairs are also in order. As the week draws to a close we thought it might be useful to highlight 5 areas that often get overlooked:
1. Change of Circumstances
Typically Wills are drafted and then filed away so it’s not uncommon for changes in circumstances to be missed. In the last week, we have seen examples of properties, businesses and even new family members such as Grandchildren(!) missed off Wills. If you don’t already have a Will or your Will is not up to date, you could leave your estate open to devolution upon your passing so if you haven’t already, we would strongly recommend you review your Will and make sure it is up to date.
2. Inheritance Tax (IHT) Planning
Your financial position may have changed since your Will was drafted, the IHT rules may have also changed. For example, there was a significant update in 2017 that will impact on any IHT planning completed prior to that. It is good practice to review your Will and IHT position every two years. An effective IHT plan will ensure that your assets are transferred according to your wishes in the most tax-efficient manner. With some careful planning and good advice, significant reductions can be achieved in IHT.
3. Power of Attorney
A Power of Attorney is a document that lets you set out who you wish to make decisions (medical and financial) on your behalf if you are no longer able to. This area is often overlooked and can create additional levels of stress for your immediate family if there is a period of prolonged illness.
4. Shareholders and Partnership Agreements
Business partnerships automatically dissolve on the death of a partner without a written agreement which means any value you might have via your business could be lost. If you have a limited company and don’t have a shareholders agreement it could lead to a lengthy dispute between your family members and business partner(s). When reviewing your Will you should also review your shareholder or partnership agreements to ensure they accurately reflect your wishes.
5. Life and Critical Illness Insurance
Do you have the necessary policies in place and are they set up in the right way so that they pass to the beneficiaries in the most tax-efficient way? Typically this will be via a trust but that will depend on the beneficiaries personal circumstances and also the overall value of the estate. This is a complicated area and can often be overlooked particularly for business owners who might also have a policy that pays into the business as well.
All of the points above (and many others) are covered in our private client review which is free for TC clients and their family members during COVID-19. If you haven’t already please contact firstname.lastname@example.org or call our Private Client Team on 0330 088 7111 to arrange your free consultation.