Residential Nil Rate Band – Qualifying Residential Interest

By | RNRB | No Comments

Residential Nil Rate Band – Qualifying Residential Interest The rules for the Residential Nil Rate Band (RNRB) introduce a variety of new terms that need defining. The first of these is a Qualifying Residential Interest. The new S8H Inheritance Tax Act 1984 defines a Qualifying Residential Interest (QRI) as an interest in a dwelling which has been the deceased’s residence at some time during his period of owning the property. This includes a property’s garden or grounds. Residence itself is not defined in the Act. In the majority of cases it will likely be clear whether a property is a person’s residence (as the majority of people will only own one property, their main residence). For when it is not, it is assumed that Capital Gain Tax case law will be relevant in this area. The property doesn’t have to be a main home and there is no minimum ownership…

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Potentially Exempt Transfers (PETs)

By | Inheritance, Wills | No Comments

Section 3A of the Inheritance Tax Act 1984 provides provisions specifically for Potentially Exempt Transfers (PETs). A PET is a transfer of value which is made during the lifetime of an individual; in other words, it is a gift of an asset and provided certain conditions are met, the PET can be exempt from IHT. The conditions which must be met are: The individual must have made the transfer on or after 18th March 1986. It must be a gift to another individual or to a specified trust. No benefit from the transfer must be retained. Individual must survive 7 years for the full value of the asset to fall completely out of the Estate for tax purposes. Where the death occurs after 3 years following when the transfer was made, taper relief applies and has the effect of reducing the tax liability on the transfer rather than the full…

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Privileged Wills

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Privileged Wills are made by those in the Armed Forces, they are usually made whilst on active duty and where a situation arises where it may be necessary to declare their final wishes but do not already have an ordinary Will in place.  A Privileged Will can be made in any form, even verbally as long as it shows the intention to dispose of their property upon death. A Will of this kind is valid even if made by a minor, since the typical age for making a Will must be 18 and those over 16 can join the Armed Forces.  The standard execution requirements (section 9, of the Wills Act 1837) including the need for two witnesses to this type of Will do not apply. However, the Armed Forces will encourage all personnel to write a Will in the standard way and personnel are usually provided an MOD Form…

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Statutory Wills – What are they?

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Statutory Wills are made by the Court of Protection on behalf of an individual who no longer has the capacity to make a Will as defined by the Mental Capacity Act 2005. The capacity of the testator must be addressed when considering the need for the Court of Protection to make a Will on the testator’s behalf. There are several reasons why a Statutory Will should be considered alongside the fact that the testator lacks capacity. Some of these include: The testator does not have a Will A beneficiary in the current Will has died A beneficiary of the current Will has already received a substantial gift Tax planning The Court of Protection will request a great deal of information, including medical evidence to support the testator’s lack of capacity, to support their decision of making the Will in the testator’s best interests. The Court will be unwilling to accept an…

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