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Codicils – What are they and why don’t we draft them?

By | Drafting | No Comments

A codicil is a document which is used to add to, alter or revoke parts of an existing Will. A codicil may even amend a previously existing codicil and there are no limits as to how many codicils a person could have. A codicil should mention what changes are being made, reference the Will and any earlier codicils by date and what amendments those previous codicils made and confirm the remaining terms of the Will. Codicils are subject to the same requirements of a Will and should therefore be signed and witnessed in the same manner as a Will. The witnesses however do not need to be the same as those from the original Will. WillPack will not prepare codicils to Wills and we instead recommend that changes be made by rewriting the Will and issuing a new Will. There are several reasons behind this. As codicils are separate documents…

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Disabled Person’s Trust

By | Trusts | No Comments

A Disabled Discretionary Trust (also known as a Disabled Person’s Trust or a Vulnerable Person’s Trust) can be utilised where a child or other relative has a disability. There are essentially two reasons why a trust is considered advisable for disabled beneficiaries. If this person inherits from a Will directly, their entitlement to any means tested benefits could be affected. Alternatively, depending on the exact disability, the beneficiary disabled person may be unable to manage a large sum of money due. If that person also lacks mental capacity and does not have a Property and Affairs LPA, it is likely that an application would have to be made to the Court of Protection to appoint a Deputy. This is a lengthy and expensive process and incurs ongoing costs and should be avoided. A disabled person’s inheritance should therefore be placed into a Disabled Discretionary Trust. The disabled beneficiary is the…

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Setting up a Will-Based Trust After Death

By | Trusts, Wills | 2 Comments

It has been brought to our attention that there are some misconceptions in regards to what action needs to be taken for a Will-based trust after the death of the Testator. The following article is intended to clarify these points. A trust in a Will, such as a Protective Property Trust, Flexible Life Interest Trust or Discretionary Trust, is not automatically set up on the death of the client. The Will trust is not itself the trust, it is more of a direction that a trust of those terms is set up upon the client’s death. There are further actions which need to be taken by the executors upon the Testator’s death in order to set up the trust and clients should be made aware of these steps. A formal trust deed would need to be drawn up on death to create the trust. This will most likely refer to…

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Witnessing a Will

By | Wills | No Comments

Arguably the most essential step when making a Will is the attestation of the Will itself, as all Wills must be signed and witnessed for them to be valid. Along with the testator signing the Will, their signature must be witnessed by two independent people. This means that the witnesses must not be a beneficiary, or the spouse/civil partner a beneficiary of the Will. If a beneficiary, or their spouse/civil partner witnesses the Will and the testator subsequently passes away before the error is rectified, the legacy made to that beneficiary will be declared void, rather than invalidating the Will entirely. If, however only one person has acted as a witness to the Will, then the Will would be invalid as section 9 of the Wills Act 1837, states that two or more witnesses must be used. It is not a legal requirement that a Will should be dated for…

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Discretionary Trusts

By | Property, Trustees, Trusts | No Comments

The Discretionary Trust is a common Trust for a Testator to use for their children to ensure that they do not inherit directly from their estate. The reasons for this can vary, for example, protecting assets from potential divorce, drinking or gambling issues, or the testators may wish that their assets are distributed in a particular manner or at certain points in their children’s lives that are outside the capabilities of the Will itself. This type of trust is effective because the assets are held and managed by the Trustees to distribute to the beneficiaries at their own discretion, hence the name of the trust and just because a beneficiary is named under the trust does not mean that they are absolutely entitled to any assets – useful where the Trustees may have concerns over how the money may be used.  Where beneficiaries are named under the Trust; this can…

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Flexible Life Interest Trust

By | Inheritance, Legal, Property, Trustees, Wills | One Comment

Flexible Life Interest Trust  Due to more complex estates and greater wealth, greater flexibility is essential to cope with any future changes to the family structure (such as new family members) and changes in the tax regime. The best way to gain the maximum flexibility is by the use of a Flexible Life Interest Trust (FLIT). How a FLIT works The residue of the estate is held on trust for the surviving spouse or civil partner for their lifetime, after which or when the life interest is ended, a discretionary trust will arise in favour of nominated beneficiaries, usually children and issue. Trustees are given a number of powers. They can grant the income of the trust fund to the surviving spouse/civil partner and have the power to grant the capital of the trust fund to them as either absolutely or as a loan, which would be repaid when the…

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Roles of executors and trustees

By | Executor, Inheritance, Legal, Trustees, Wills | 2 Comments

Who are trustees? A trustee is someone who is given legal responsibility to hold property in the best interest of or for the benefit of someone else (the beneficiaries). As the name implies, the trustee acts under a “trust” to do what is best and to act in the interests of the beneficiaries and not themselves. Number of trustees No more than 4 trustees can be appointed to act at once, however reserve trustees can be appointed. If the property of the trust includes land a minimum of 2 trustees must be appointed. Where a Trust is inserted within a Will in favour of a spouse (as a beneficiary) upon first death, it is almost always advisable that a MINIMUM of two other trustees be appointed to act jointly with the spouse. This is in order to prevent any conflict of interest due to the spouse acting as the sole…

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Intestacy

By | Inheritance, Intestacy, Legal, Wills | No Comments

Intestacy can be a complicated issue. Difficult to wrap your head around the ins and outs, if you haven’t worked much with it before. Below we’ve outlined the the rules in a simple flowchart to give you an idea on who will benefit from your estate if you a) have no Will or b) have no further levels of residue outlined in your Will.

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