Planning for the future entails not just making a will and forgetting about it but also the need for review as time and circumstances change.

Perhaps you now have children. Maybe you have amassed property or other assets which didn't exist when your will was made. Perhaps your circumstances have changed; you have married or divorced or your health is now causing you concern.

These are simply examples of changing circumstances that should make us look again at our personal affairs. Pickworths can help you think through all your options with regard to:

• making or reviewing your will
• lasting power of attorney
• protecting your assets as you get older
• gifts of property
• tax and tax planning

Regular review with the advice of a professional is the only sure way to plan for the future.

Contact Kate McNamee, Ian Tottman or June Yap

Generally there is no inheritance tax payable on gifts between spouses.  Therefore a Will leaving everything to the surviving spouse will result in no inheritance tax being payable when the first spouse dies.  However, when the second spouse dies the value of the two combined estates is potentially subject to inheritance tax. 

For the 2004/2005 tax year the first £263,000 of the estate (the Nil Rate Band) is effectively “free of tax”.  The remainder of the estate (not passing to a spouse or charity) is then taxed at 40%.  If, as is often the case, everything is left to the spouse on the first death, the Nil Rate Band on the first death will be sacrificed.  The failure to utilise the Nil Rate Band of the first spouse to die can result in the second estate suffering an additional £105,200 in tax (i.e. £263,000 x 40%). 

Because of the relatively high value of the matrimonial home many married couples’ estates come within the charge to inheritance tax. Using the family home in inheritance tax planning successfully can be difficult and generally we advise against it

However one very effective Will planning arrangement is called “the Nil Rate Band Discretionary Trust scheme” which is increasingly popular.  However, there are some issues in using the main home or an interest in it within such a scheme unless an additional provision known as “the Debt/Charge scheme” is incorporated   We are happy to prepare a Will incorporating a Discretionary Trust scheme in a suitable case and to advise how the scheme could work in practice in order to save Inheritance Tax for the survivor.

Contact Kate McNamee, Ian Tottman or June Yap.

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