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kindly produced by the Institute of Cancer
Research © 2002
Why
should you have a Will?
Everyone over the
age of 18 should have a valid up-to-date Will.
It ensures that your estate is distributed in the way you
wish and saves time, money and unnecessary hardship and upset for
your survivors.
Your ‘estate’
is everything you own: your house, savings, car, insurance policies,
etc, and without a Will these assets will be distributed according
to the laws of intestacy, which take no account of the wishes of the
deceased. Many people
think their estate will go to their partner when they die, but this
isn’t necessarily the case. An
unmarried partner is not automatically entitled to anything.
A valid Will
ensures that your assets will go exactly where you want them to go
on your death. It gives
peace of mind to you and your family by avoiding unnecessary delay
and expense. A properly
written Will also allows for provision to be made to lessen the
impact of Inheritance Tax. If
the estate is worth more than £275,000 as at April 2005 (i.e. tax
year 2005 - 2006), then the
amount over and above this figure may be taxed at 40%.
Gifts to charity are free of Inheritance Tax regardless of
the size of your estate.
A Will is an
extremely important legal document and therefore needs to be
precisely worded. As
such, it’s advisable to seek professional help to ensure that all
contingencies are covered. In
this way you can make sure that you understand the terms of the Will
before you sign it and that it does actually say what you want to
happen.
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If you do not have
a Will, then your estate will be distributed according to the Law,
and as at May 2002, broadly speaking, states that:
º
If you were married at the time of your death then
your spouse will get everything if you left less than £125,000
º
If more than £125,000 is left but you leave no children,
parents or siblings, then your spouse will get everything
º
If you die leaving a spouse and children, then your spouse
will get the first £125,000 and your personal effects.
The remainder is divided as follows: your spouse gets a life
interest in half and the other half is divided between your
children. A life
interest means that your spouse is entitled to the income on that
half for their lifetime and on their death it will automatically
pass to your children
º
If you die with no children, but have surviving parents or
siblings, then your spouse gets the first £200,000 plus personal
effects and the remainder is divided two ways.
Your spouse will get half and the other half goes to your
parents. If your
parents have pre-deceased you, this share is divided between your
siblings.
º If
you are not married at the time of you death, then your estate
will be distributed as follows:
º
If you leave children then it will be divided equally between
them
º
If there are no children but your parents survive you, then
everything will go to your parents
º
If there are no children or parents, then your siblings will
receive everything
º
If you leave no children, parents or siblings, then your
grandparents will get everything
º
If none of these people are still alive, then it will be
divided among your uncles and aunts
º
If there are none of the above then your estate will pass to
the Crown
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Who
should be appointed as Executor(s)?
You appoint
Executors in your Will to ensure that your wishes are carried out
properly. Their task is
to collect all the assets, obtain a Grant of Probate, account to the
Inland Revenue for any Inheritance Tax payable, pay debts and
funeral expenses and then distribute the remainder in accordance
with the terms of the Will. They
can do this themselves or they may instruct a solicitor to act for
them.
Anyone over the age
of 18, including a beneficiary, can be appointed as an Executor.
The total number of executors you can choose is four and they
must act together.
Executors can
benefit under a Will.
Solicitors and
banks will accept appointment as Executors but will usually charge a
fee for administering the estate.
You should ask your
Executors for their agreement to act before naming them and tell
them where the Will is kept. You
can store it at home, with a solicitor or bank (charges may be made)
but you should always keep a copy with your own papers.
It will also really
help your Executors if you keep a list of your assets with your
Will, such as details of policies, investments etc, together with
contact details of banks, building societies and other financial
institutions so they can find everything they need in the event of
your death.
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When was the last
time you looked at it?
Although your Will
may never need rewriting, you may like to review it every four or
five years or so, whenever a substantial change occurs in your
personal finances or your family situation, to ensure that it still
reflects your wishes.
If any alterations
or additions become necessary, you should employ a solicitor to make
the necessary changes.
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Administrator
Someone who is
appointed by law to settle your affairs if you die without a Will.
Beneficiary
Anyone who receives
from a Will.
Codicil
If you want to
amend an existing Will, you can add a codicil.
However, it’s often just as easy and no more costly to make
a new Will.
Conditional interest
A legacy which is
dependent upon an event happening or not happening, on which it is
either to take effect or be defeated, or a legacy which is dependent
upon specific criteria being met.
Contingent
interest
A legacy which is
dependent on a contingency e.g. ‘if the beneficiary shall attain
the age of 21 years’.
Crown or Treasury
This is the
government, which receives your estate if you die without a Will and
with no next of kin.
Estate
This is the total
value of everything you own at your death, minus any outstanding
commitments.
Executor(s)
The people you
choose to carry out your wishes as specified in your Will.
You may choose up to four executors.
Funeral arrangements
Directions
regarding your wishes such as details of the disposal of your body,
the funeral service, “in memoriam” gifts in lieu of flowers etc.
Inheritance Tax
The 40% tax payable
on larger estates (legacies to charity are free of Inheritance Tax).
Intestate
When someone dies
without a Will.
Legacy
A gift in a Will
which can be:
º
Specific – a definite object or property.
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Pecuniary – a gift of a specific sum of money.
º
Residual – a gift of money or assets left when other
legacies and expenses have been paid i.e. a gift of part or
all of the remainder of your estate.
Life interest
e.g. “to my wife
for use in her lifetime, then to charity”.
The beneficiary is only entitled to use of the income during
his/her lifetime. The
capital remains untouched.
Probate
The legal process
to establish that your Will is valid.
Testator/testatrix
(m/f)
This is you, the
person making the Will.
Trust
An arrangement you
can make in your Will to administer part or all of your assets after
your death and the administration of your estate.
Witness
Two witnesses must
see you sign your Will and you must watch both of them sign it.
They must also watch each other sign it.
No beneficiary (or their spouse) should sign the Will. If they do, any gift to them will be invalid.
There are stringent rules attached to the signing of the Will
to ensure that it is valid, so seek professional advice if
necessary.
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This article gives
a general overview of the issues surrounding Will making and does
not purport to give advice. You
should seek professional advice when making your Will.
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Why
leave a legacy to The Institute of Cancer Research?
Since 1909, The
Institute of Cancer Research has worked towards understanding and
treating all forms of cancer. With
over 850 scientists, we are based in Fulham Road, London and in
Sutton, Surrey, and in partnership with The Royal Marsden Hospital,
we are the largest comprehensive cancer centre in Europe.
We have a proven track record of international scientific
excellence.
Each day our
research takes us a step closer to a thorough understanding of this
disease, and the invaluable help from our supporters ensures this
progress continues. We
rely heavily on legacies, which allow us to plan for future research
projects. Generous
bequests help us to continue our vital work and achieve our goal of
relieving human suffering by pursuing excellence in the fight
against cancer. Gifts to The Institute of Cancer Research are completely
exempt from tax so our work benefits from the full value of any
legacy you may make.
We are a highly
cost effective organisation with 92p in every £ of our total income
being devoted to supporting research.
For further
information on our scientists’ progress and achievements to date,
what legacies mean to us and how to make a Will online, please visit
www.icr.ac.uk/legacy.html
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