Estate Planning is a process by which an individual will anticipate and arrange for the management and disposal of their estate, in the event the person becomes incapacitated/after their death.

By making a Will, you are leaving clear instructions about how you would like your estate distributed after your death. If you do not leave a Will then your estate will be subject to the rules of Intestacy.

Many people think that if they are married and do not have a Will, then everything will simply pass to their spouse/civil partner. Unfortunately, this is not always the case and depends on the value of the estate. By making a Will you can ensure your wishes are carried out after your death and that you avoid further hassle and heartache for those left behind.

Intestacy means you have died without a valid Will in place and therefore your estate will be distributed according to these rules. Many people assume that if they die without a Will, then everything will automatically pass to their spouse. Depending on the value of the estate, this is not always the case. The main – and perhaps most significant – effect of dying intestate, is that it is no longer the deceased who decides which family member or loved one inherits what, but rather the law decides. This can obviously cause uncertainty and is far from ideal, which is why we recommend that you make a Will to avoid dying intestate.

A Will Trust or testamentary trust - is created within your will to allow you to protect a property that you wish to pass on to your family. A Will Trust is a legal entity that allows someone to benefit from the asset without being the legal owner.

An executor is an individual named in a Will who will sort out a persons’ estate after their death. It is advisable to name more than one Executor in case one of them passes away or loses capacity.

Setting up a Will Trust will enable you to protect property that you own and ensure it passes to those that you intended. It will also prevent Sideways Disinheritance. The team at True Bearing Legal Services will be able to set up a Will Trust for you and provide valuable advice on Estate Planning.

The RNRB can only be utilised when estates are directly inherited by children, stepchildren, adopted children or grandchildren. For example, it will not apply if property is left to other family members such as nieces, nephews, brothers or sisters.

You must leave a property in your estate to claim the RNRB. For a property to qualify under the RNRB, it is enough for the property to have been a residence but not necessarily a main residence, of the deceased at some point. For example, a property that has always been a buy-to-let, will not qualify.

The residence nil-rate band (RNRB), is a piece of legislation that permits the further reduction of Inheritance Tax (IHT) on the sale of a family home.

The individual allowance for 2021 remains at £175,000 but increases in line with the Consumer Price Index (CPI). It is transferable between spouses, which will eventually permit them potentially to pass on wealth up to £1m without incurring tax.

Prior to RNRB being introduced, what happened was that every person received a Nil Rate Band of £325,000 (this is the value of an estate that is not subject to inheritance tax). Now that the new RNRB has been introduced each parent will have a nil rate band of £325,000 plus a RNRB of up to £175,000 (by 2020). A potential total of £500,000 for each parent which is not subject to inheritance tax on death.