The following article explains the collective roles of Wills and Probate in establishing how a person's estate should be divided and their affairs managed, in the event of their death.
What is a Will?
A Will is a legally-binding document which a person writes in order to express their wishes in the event of their death. This will outline how the deceased wants their estate to be distributed as well as specific instructions on matters such as funeral arrangements and care of children.
Why should I make a Will?
Making a Will is the only way you can fully guarantee that when you die, your wishes are adequately represented. When making a Will, you will appoint one or more executors, people who you assign to manage your affairs after your passing. If these executors are not assigned before your death, then a member of your family or a friend will have to apply for a 'grant of probate', which will allow them to control your estate and affairs. In addition, many people decide to make a Will in order to avoid hefty inheritance taxation.
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Astonishingly, recent research shows that as many as 60% or people never make a will.
Inheritance Tax
Inheritance tax is one of the biggest issues for people when they are considering making a Will, as the benefactors of our estate are subject to tax on the proceeds. Under inheritance tax guidelines, people are entitled to 'gift' a certain amount of their estate to friends and loved ones, meaning that they can avoid some of this taxation.
Historically, many people have been known to gift assets such as their house before their death, in order to avoid this taxation. However, the Government has recently begun a crack down on this, enforcing strict guidelines for those who gift property before their death.
What happens if I don't make a Will?
Those who die without making a Will are what is known as 'intestate.' This means that there is no provision in place for the distribution of their assets and the control of their affairs. In these circumstances, an individual's estate will usually be distributed in line with law, which states that the next of kin will inherit all of the estate. If there is more than one next of kin, for example if the deceased has several children, then the estate will be divided between them.
If the deceased has no next of kin, or if other family members wish to contest the division of an estate, then they have to apply for what is known as a 'grant of probate', which is the legal right to handle the affairs of the deceased. If a Will has been made, then the 'grant of probate' will usually be assigned to the appointed executor of the estate.
Now you know more about Wills and Probate, if you haven't already, perhaps now is the right time to make a will, so that your wishes can be carried out in the event of your death.