Wills & Intestacy

Question 1

Checklist for a valid Will (5)

Answer 1

• Testator over 18
• Of sound mind
• Written
• Signed by testator
• Signature witnessed by 2 indep witnesses
• Witness cannot benefit from will

Question 2

Duties of executors (5)

Answer 2

• Determine assets and liablities
• Get probate
• Collect assets and pay debts
• Settle tax liabilities
• Complete account for HMRC

Question 3

Features of a Mirror Will (3)

Answer 3

• Everything to spouse
• And then children
• Can be changed after 1st death

Question 4

Features of a Mutual Will (4)

Answer 4

• Identical wills
• Can be revoked prior to first death only
• Post 1st death a constructive trust is formed
• Beneficiary could sue if will changed

Question 5

Deed of Variation (9)

Answer 5

• Allows estate to be altered within 2 years of death
• Must be over 18 and of sound mind
• Executed via Deed
• Must confirm if for IHT purposes
• Signed by executors if creates more IHT
• Must be done within 2 years
• Must be signed by affected beneficiaries only
• Doesn’t need to have been a will
• Can only be varied once

Question 6

What is a Deed of Disclaimer? (5)

Answer 6

• Similar to a DOV
• When a person inherits but doesn’t want to accept it
• Must be disclaimed within 2 years of death
• No consideration for money or money’s worth
• Person disclaiming has no control over new recipient

Question 7

What situations revoke a Will (4)

Answer 7

• Destroy it
• Getting married
• Make a new one
• Must be of sound mind
• Divorce doesn’t revoke a will - only cancels ex-spouse as executor and/or beneficiary of the will

Question 8

Process when someone dies intestate (3)

Answer 8

• Administrator applies for grant of letters of administration
• Duties - identical to executor
• Once IHT paid and obtained grant, can distribute in line with intestacy rules

Question 9

Intestacy rules - no children

Answer 9

• Spouse entitled to everything absolutely

Question 10

Intestacy rules - spouse and issue

Answer 10

• Spouse takes chattels
• £250k absolutely
• 50% of remaining estate absolutely
• Children take remaining 50% absolutely

Question 11

Intestacy rules - no spouse

Answer 11

• Children take all absolutely

Question 12

Residence NRB - qualifying criteria (1)

Answer 12

• Must be left to direct descendant

= Child, grandchild, spouse/partner of child/grandchild

Question 13

When is the RNRB reduced and at what rate?

Answer 13

• Estates with a net value over £2m

- Reduced by £1 for every £2 over the the threshold

Question 14

What rate of income tax is charged on the deceased’s income up to death

Answer 14

• Taxed in usual manner

- Income after death - no PA, PSA or DA - taxed at basic rate only

Question 15

Criteria to benefit from reduced IHT of 36%

Answer 15

• Minimum of 10% of net estate, after reliefs and exemptions - left to charity in will