Ways to avoid Will and Estate Planning challenges

For many clients who come to us, making the important decision to plan for the future, including estate planning and writing a Will can feel intimidating. However, there are some practical ways to help ensure your estate passes in accordance with your wishes and avoids any challenges to your estate after you’re gone. ZEDRA’s Head of Probate, Paula Barlow, shares her tips.

Why is there an increase in Wills, Trusts and Estates being contested?

There are several factors that could explain the increased litigation in the UK in respect of Wills, Trusts and Estates which include:

• Poorly drafted Wills, particularly during the pandemic when many people rushed to make a Will.
• Increased wealth over the past few decades and disagreements over the distribution of that wealth.
• More complex family structures, with remarriages, blended families and cohabitation on the rise. We often encounter cases where an individual has not updated their Will or Trust to reflect their current circumstances and it is later contested by relatives or friends.
• Adults generally living longer and drafting Wills later in life when questions can arise around their capacity to make a legitimate Will.

Proper estate planning – including planning for complex family structures such as multiple marriages and stepfamilies – can help to avoid or mitigate familial discord and stress, a situation that every family wants to avoid.

How can a Will be contested?

A Will can be challenged for a variety of reasons, including if it is believed that the Will was not validly signed, undue influence was placed on the deceased at the time they made the Will or there is a belief that the deceased lacked capacity to make the Will.

In the UK there is legislation (the Inheritance (Provision for Family and Dependents) Act 1975) that allows certain individuals – close family members, civil partners or anyone who can prove they were maintained by the deceased in some way immediately before death – to make a claim against an estate if it is considered that reasonable financial provision has not been made for them in the Will or on intestacy.

How can I plan to avoid a Will dispute?

Professional Will Writers

Even if you prefer to write your own Will, it’s in your and your family’s interest to work with an experienced Will Writer to take care of it for you.

The process of drafting a Will, preparing detailed notes about your wishes and understanding of your circumstances to accompany the Will, and the execution process are specific and easy to get wrong if you don’t have experience.

A seemingly small procedural misstep is enough to invalidate your Will – and your wishes.

Regularly review your Will

It’s also important to review your Will every few years to ensure it accurately reflects your wishes, financial circumstances, and current family structure.

Inheritance Tax

In addition to a Will, there are several other key components of estate planning, including inheritance tax planning.

In the UK, the rate of inheritance tax is 40% charged on the portion of an estate that is over the nil rate band reliefs and other available exemptions.

Typically, there is no inheritance tax to pay if the value of your estate is below the nil rate band reliefs available or you leave everything above the reliefs to your spouse, civil partner, a charity, or other exempt organisations.  There are other exemptions and reliefs available that can be claimed to mitigate the estate’s inheritance tax liability.

Inheritance tax calculations can be complicated, and it can be easy to overlook reliefs and exemptions that can be claimed. A professional can help you to review your specific circumstances and provide guidance on steps you can take to mitigate your inheritance tax liability.

There are also delays at HM Revenue and Customs which impact estates subject to inheritance tax.  This means that depending on the complexity of the estate, it can take 18 to 24 months to finalise the administration of an estate subject to inheritance tax.

Choosing your Executor

Although it is understandable you want to choose executors who you can trust, those closest to you are often required to step into their role unexpectedly, at an incredibly emotional time, and may not know where to start.  An executor has many duties and responsibilities which may be too much for a family member or friend to take on at an already difficult time.

One key area an executor is responsible for is securing the deceased’s assets until they are sold or distributed to beneficiaries.

For example, if you own property, the executor needs to make sure it is maintained and adequately insured. The executor is also responsible for ensuring that taxes including income tax, capital gains tax and inheritance tax are properly assessed and paid on time. In addition to this, the executor is tasked with ensuring no fraudulent transactions take place for example through investment and bank accounts.

To compound this stress, the executor must ensure they have paid all liabilities, administration expenses and taxes before distributing the estate to the estate beneficiaries. If they fail to do this, they could be personally liable for paying any outstanding balances.

The role is generally not well understood and it can be a heavy burden to take on the role of executor, especially if lacking experience.

ZEDRA’s Probate and Estate Administration professionals can ease that burden and support you by taking on the responsibility as a professional estate executor.

Talking to your loved ones in advance

It’s a good idea to let your executor or someone you trust know where your signed will is located. Over 65% of individuals did not know where to find their parents’ Wills, even though the majority are filed in a solicitor’s office according to a recent Will Aid survey. This can lead to stress as the original will needs to be sent to the Probate Registry with the grant application and can delay the start of this already lengthy process.

Despite the Probate Registry introducing a new digital application system in 2020 designed to improve the probate application process, the Probate Registry typically takes up to 16 weeks (sometimes longer) to issue a grant of probate. The grant of probate is an important document and allows the executor to deal with the assets of the estate.

So, where should I begin?

There are several things you can do to prepare to work with an estate planning professional:

• Think deeply about your legacy and who you’d like to benefit from your estate, why, and in what proportion.
• Have a clear understanding of your total assets and documentation of those assets.
• Be open and transparent with your adviser. If they understand the complexities and nuances of your family structure and assets, they’ll be able to prepare a plan that is best suited for you and your family.
• Communicate with your family members so that they understand your wishes.
• If there is going to be inheritance tax liability due on your estate, communicate with your family to prepare them.
• Consider a trustworthy person to be your executor. You may feel that it is better to have a professional executor to support your family members at a difficult time and take on the risks and responsibilities linked to this role. If appointing a family member or friend as an executor, consider their physical and mental wellness and their ability to follow through on the various required responsibilities at the date of your death.

Taking a proactive approach to writing your Will and Estate Planning can ease the burden for your relatives and maximise your estate. There are several things you can do to prepare, including working with an experienced solicitor to prepare your will and estate plan; engaging a professional executor; communicating openly with your family about your wishes to reduce stress; and making them aware the probate process will take time.

How ZEDRA can help

At ZEDRA, our experienced team has the necessary expertise to handle all aspects of Estate Planning, Trusts, Probate and Estate Administration, including drafting your Will and guiding you through the Grant of Probate process, with the highest level of skill, compassion, and professionalism. For more information, contact Paula Barlow, Head of Probate, Manchester, ZEDRA.