There has been much discussion in the news about changes to the tax rates. Some of these changes were expected more than others. Nobody wants their tax liability to come as a surprise, not least the beneficiaries of your estate once they realise how much tax will need to be paid.
For this reason, it is a good idea to keep up to date with any changes to the tax legislation that could have an impact on your estate when you die. It might be the case that your Will needs to be revised to better accommodate such changes.
The main tax that we think of when we talk about Wills is Inheritance Tax (IHT). It is important to be aware of how IHT works and the implications that it might have for your estate. For instance, it is widely known that IHT must be paid on the assets that you own when you die to the extent that their total value exceeds the relevant IHT thresholds. Most people are also aware that the rate of IHT is currently an eye-watering 40%.
What is less clear is how any gifts that you have made during your lifetime might affect the position on your death, and does the position differ depending upon the size of the gift, the recipient, and how long ago it was made? What about those assets that you theoretically gave away some time ago but remain in your possession, or you have retained some use or enjoyment of them? Also, are there any other IHT reliefs available that might help to reduce the ultimate tax bill, and what are the eligibility requirements for these?
Aside from changes to the tax rules and rates, another good reason to review your Will regularly is to ensure that it is doing the best job that it can for you and your loved ones in your current circumstances. Even if you feel that nothing has changed, we recommend that you should review your Will and any associated estate planning at regular intervals and at least every five years.
If you are unsure if your situation has changed enough to warrant a review of your Will, or if you believe that a review is needed at this point, please contact our Private Client team who would be happy to advise you.
Although correct at the time of publication, the contents of this newsletter/blog are intended for general information purposes only and shall not be deemed to be, or constitute, legal advice. We cannot accept responsibility for any loss as a result of acts or omissions taken in respect of this article. Please contact us for the latest legal position.