First rate expertise and know-how in private client legal services
We firmly believe in the importance of making a will and every year we help dozens of individuals and families put in place measures that will give them true peace of mind. We believe in a holistic approach and we do not take “execution only” instructions. We want to understand your financial and family circumstances so that we can help you take the very best decisions possible and ensure that your will planning dovetails with the nature of your property ownership and perhaps your life policies and pensions held in trust. In doing so we may ask to speak to your accountant or financial advisor as in many cases it is just as important that they understand too. Ultimately though, we do understand that some clients would just like to keep things simple and that is perfectly fine by us so long as we have advised them of all of the options and ensured that they understand the full implications of what they are doing.
We believe that in appropriate cases, trusts can provide highly beneficial solutions for wealth transfer, asset protection, and exerting ongoing control of important assets. They can also be useful for controlling sums of money that arise upon death, for example death-in-service benefits, life assurance proceeds, pension lump sums, business assets and of course your estate left by your will. We understand that the practical consequences are just as important if not more important than advising on the trust document itself. Furthermore, understanding the tax consequences of making a trust, and the tax consequences of operating a trust, and the likely administration expenses each deserve due consideration. We provide full advice from the outset and get to understand the client and their situation which we find helpful when preparing an accompanying letter of wishes. Our work involves preparation of the will or trust deed, advising on the assets transferred into the trust, we also advise trustees on ongoing administration, and in certain circumstances we act for beneficiaries too. In many cases we work closely with other professional advisors.
These days all but the most simple probates invariably require the help of a professional advisor (preferably a STEP qualified solicitor) as successive governments have made inheritance tax more and more complicated. We now have to grapple with not only the nil-rate band, transferrable nil rate band, but also residence nil-rate band and transferable residence nil-rate band. Lifetime gifts also need to be taken into account and reliefs duly claimed. Sadly if you do not claim a relief and pay tax on it, you cannot count upon HM Revenue & Customs writing to you to point out your error. However probate is certainly not just about tax as there is plenty of legal advice and know-how required throughout. We find that clients who start off by themselves can soon find themselves out of their depth drowning in correspondence and finding their time eaten away by the demands of the administration whilst at the same time juggling their own family life and full time job. Furthermore choosing not to use a solicitor can result in personal liability for any mistakes that arise whether reckless or ignorant and if Inheritance Tax is under-declared whether by mistake or not this can result in fines and penalties and potentially more serious sanctions.
Our level of involvement will depend upon the complexity and the circumstances of the matter at hand. In some instances we will do everything, which can even include registering the death and organising the funeral. In most cases there is a sharing of responsibility and estimates of costs are given on the basis of actual work we are undertaking. We are particularly adept at dealing with estates involving trusts and complicated ownership issues. The main are of our probate expertise is in dealing with taxable estates. We can make sure that all of the exemptions and reliefs are duly claimed and advise on how much inheritance tax actually needs to be paid upon application for the grant of representation. Our practical know-how can prove invaluable and sometimes our clients find that an estate that they believed was liable to inheritance tax is actually .
Lasting Powers of Attorney
We believe that all of our clients should have put in place Lasting Powers of Attorney for Property and Financial Affairs and Health and Welfare so that decisions can be taken for them in the event of loss of mental capacity. It is commonly misunderstood by many that LPAs are only something to do when age starts catching up with you, however sadly loss of mental capacity could happen unexpectedly through an accident such as in the sad case in point is the Formula 1 Legend Michael Schumacher.
Upon loss of capacity no person is empowered to take control of your assets and finances unless you have appointed attorneys under a LPA Property and Financial Affairs. By the same token if you were in a medical situation and were unable to take any decisions for yourself you may be surprised to learn that your next of kin has no legal authority to take decisions on your behalf unless such person is appointed as one of your attorneys.
Making an LPA is not recommended without taking full professional advice on the options available to you, so that you can be familiar with the options available to you and the practical aspects. Key issues include who should be appointed as attorneys, how they should be appointed, whether any replacements should be considered, what the attorneys can and can’t do, whether restrictions or guidance is necessary, who should act as Certificate Provider, who should be notified and whether the document should be registered, and all practical aspects.
Inheritance Tax mitigation and other tax advice
Inheritance tax receipts are estimated to have risen to a record £5.2BN in 2018 as it affects many more of us than was perhaps originally intended when it was first introduced. It is also a very complicated tax where an in-depth understanding is essential. It is commonly thought by clients we see that they have an IHT free allowance of £1M as this is what they read in their newspaper or heard someone mentioning on Money Box on Radio 4. The Government could have increased the Nil Rate Band to £500,000 so that this could be doubled to £1M and transferred to the children on the death of the remaining spouse or civil partner. Sadly they did not, and instead invented a complicated supplementary allowance known as the “Residence Nil Rate Band” which from 6 April 2020 is worth £175,000 and in certain circumstances can be transferred across on the second death. The problem is that the RNRB does not apply in a lot of situations and requires in-depth analysis to consider factors such as whether the provisions of a will are compatible, ownership of property that has been lived in as a dwelling house, there being a descendant, and the value of the estate in the sole ownership of the person who died. It is also unfair on those who have never had children or step-children, although that said, inheritance tax itself can be unfair on those who are not able to benefit from spouse exemption on the first death. We have clients in their mid-90s who are sisters who live together who have saved their whole lives…
In our work it is necessary to have a solid understanding of taxes including inheritance tax, capital gains tax, stamp duty land tax and also income tax. This is because taxes are pervasive and at each stage of advice given it is necessary to consider the tax implications so that you can make a fully informed decision. We are also often advising in an international context so we are used to dealing with those domiciled outside of the UK and minimising their exposure to UK inheritance tax.
We are used to providing estate tax planning advice and taking steps to ensure that inheritance tax is mitigated or in some cases avoided altogether using well established planning and creative thinking where appropriate. We are careful to ensure that avoidance is never evasion and it is frustrating that politicians and the media often confuse the meanings of those words. That said we do not believe in advising on aggressive and highly artificial avoidance as in most cases such schemes are undone either by retrospective legislation or susceptible to Revenue challenges under the Ramsay principle or under the General Anti-Abuse Rule.
We regularly advise on lifetime gifts including gifts into trust and transfers of ownership, tax-efficient post-death reorganisation including innovative deeds of variation, and generation skipping inheritance tax planning in the context of wills and trusts.