Macanta Wills & Estate Planning Limited

📝 Understanding Inheritance Tax and Allowances 🏡

At Macanta Wills, we know that planning for the future can be daunting, especially when it comes to understanding inheritance tax (IHT). Here’s a breakdown of the key points, including the important allowances you need to be aware of: the Nil-Rate Band (NRB) and the Residence Nil-Rate Band (RNRB).

What is Inheritance Tax (IHT)?
Inheritance Tax is a tax on the estate (the property, money, and possessions) of someone who has passed away. The current standard IHT rate is 40%, which is only charged on the part of your estate that’s above the tax-free threshold.

Key Allowances:
1. Nil-Rate Band (NRB)
Amount: The NRB is currently £325,000.
Application: This is the threshold up to which the estate has no IHT liability. For estates valued below this amount, no IHT is payable.
Transferable Allowance: If you're married or in a civil partnership, any unused NRB allowance can be transferred to the surviving partner upon death, potentially doubling the threshold to £650,000.

2. Residence Nil-Rate Band (RNRB)
Amount: The RNRB is an additional allowance of £175,000.
Application: This allowance is available if you pass on your home, or a share of it, to your children or grandchildren.
Transferable Allowance: Similar to the NRB, the RNRB can be transferred between spouses or civil partners, offering up to £350,000 additional threshold.
Tapering: For estates valued over £2 million, the RNRB reduces by £1 for every £2 over this threshold.
Example Calculation
If you leave an estate worth £375,000, including your home, and pass it to your children:

NRB: £325,000
RNRB: £175,000
Total Tax-Free Allowance: £500,000
In this case, your estate would not be liable for any IHT.

Planning Ahead
Ensuring that your estate is efficiently planned can save your loved ones from significant tax burdens. Our experts at Macanta Wills are here to guide you through the process and help you make the most of these allowances.

📞 Contact Us: For personalised advice and will writing and estate planning services, call us on 01924 682091 or email us at [email protected].

🚨 Important Update from Macanta Wills: Think Twice Before Signing Your Property Over to Your Children 🚨

It's a common myth that signing your property over to your children is a smart way to avoid care home fees. However, this strategy can lead to significant risks and complications. Here's why:

1️⃣ Deprivation of Assets Rule: Local authorities may view this transfer as a deliberate attempt to avoid paying care home fees, known as "deprivation of assets." This can result in the transfer being disregarded and the value of the property still being included in your financial assessment.

2️⃣ Loss of Control: Once you transfer your property, you no longer have legal ownership or control over it. This means you could face difficulties if you need to sell the property or access its value in the future.

3️⃣ Tax Implications: Transferring property can have unexpected tax consequences, such as capital gains tax for your children if they decide to sell the property later on.

4️⃣ Family Disputes: Putting your property in your children's names can lead to family conflicts, especially if relationships change over time. It can also be problematic if your children face financial difficulties, divorce, or other personal issues.

5️⃣ Impact on Benefits: Transferring assets can affect your eligibility for certain benefits, potentially reducing your overall financial security.

👉 What You Should Do Instead:

Seek Professional Advice: At Macanta Wills, we can help you explore alternative strategies for managing care home fees without jeopardizing your financial security or family harmony.

Consider Trusts: Setting up a trust can offer more control and protection over your assets.

Plan Ahead: Proper estate planning can provide peace of mind and ensure that your wishes are honoured without risking your financial future.

Avoid potential pitfalls and ensure your assets are protected. For expert advice and tailored solutions, contact Macanta Wills. 📞📧



🌐 Visit our website www.macantawills.co.uk
📞 Call us: 01924 682091
📧 Email us: [email protected]

Your peace of mind is our priority. Let’s ensure your loved ones are taken care of without compromising your own security. 💙

🚨 Important Update from Macanta Wills: Your Will and Your Pension 🚨

Did you know? Your Will won't automatically deal with your pensions 📜🚫

Here's why:

1️⃣ Separate Rules: Pensions are governed by different rules and regulations compared to other assets. They typically fall outside the scope of your Will.

2️⃣ Nomination Forms: Pension providers usually require a "nomination of beneficiaries" form. This ensures that your pension benefits go directly to the people you choose, bypassing the instructions in your Will.

3️⃣ Tax Efficiency: Directly assigning pension benefits to your beneficiaries can be more tax-efficient, providing them with the best possible financial outcome.

4️⃣ Flexibility: Updating your pension beneficiaries through your provider is often quicker and more straightforward than amending your Will.

👉 What You Need to Do:

Check your pension scheme rules: Ensure you understand how your pension provider handles nominations.

Update your nomination forms: Make sure your current wishes are reflected in these forms.

Consult with us: At Macanta Wills, we can guide you through the process to ensure your loved ones are fully protected and your wishes are honoured.

Take action today to secure your financial legacy! For expert advice and assistance, contact Macanta Wills. 📞📧



🌐 Visit our website www.macantawills.co.uk
📞 Call us: 01924 682091
📧 Email us: [email protected]

Your peace of mind is our priority. Let’s ensure your loved ones are taken care of, even after you're gone. 💙

Creating a Will in Anticipation of Marriage involves adding a clause acknowledging the impending marriage to a specified person.

Section 18 of the Wills Act 1837 allows for this, and since 2005, it includes civil partnerships. This type of Will prevents the subsequent marriage from revoking its validity, which is crucial, especially when there are children from a previous relationship.

Without such a Will, the Intestacy Rules may govern the estate distribution, potentially excluding your spouse or other desired beneficiaries. Crafting a Will in Anticipation of Marriage safeguards your wishes for the precise distribution of your estate.

Failing to name Guardians in your Will means that the care of minor children will be decided by the Courts.

When guardians are successfully named in your will, you are granting those individuals parental responsibility. This means that the appointed guardian will have the ability to decide on matters pertaining to the children's care, education, and medical needs. Therefore, choosing a guardian carefully is essential. Only the court has the authority to designate Guardians in the absence of a legitimate appointment. Even in cases where the child has a disability, the guardianship will terminate when the child becomes eighteen.

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Who can challenge my Will?

Testamentary freedom is a legal principle that provides people with the right to dispose of their estate, on death, to whomever they choose. Although there are certain groups of people who would expect to receive something from the estate.

As a result of this, there are certain relatives and dependents that can make a claim under the Inheritance (Provision for Family and Dependents) Act 1975 on the grounds that the estate didn't make reasonable financial provision for them.

The classes of people who can make a claim are listed below:

A spouse or civil partner.
A former spouse or civil partner - must not have remarried or registered a new civil partnership.
A person who cohabited with the deceased (husband/wife) for 2 years prior to the date of death.
A child.
A child treated as a child of the family (e.g. step children, children you are a guardian to).
A person maintained by the deceased.

However, there are certain conditions that must be met for there to be a successful application under the Act.

Contact us for more information
[email protected]
01924 682064

Surely, all I need to do is write a Will that reflects my choices?

Ideally yes, however with the increased complexity of modern family structures, more people having a size-able estate to pass on can mean that it feels there is something worth fighting for, particularly at a time when emotions are running high. As a direct result of this, the legal industry is seeing a growing number of cases where people are seeking legal remedy from being left out of a Will entirely, or receiving less than expected as a deliberate act on the part of the deceased.

Claims

A growing 'compensation culture' and people becoming more aware of their legal rights from stories and articles in the media and the ability to bring a claim if there is something they see as unfair or amiss, means more of an incentive and appetite to challenge a Will. The number of inheritance disputes reaching the High Court each year has soared to a record high, a trend that lawyers put down to the intricacies of modern family life and rising property prices.
In simple terms, it is a statement written in plain English, setting out your wishes for the distribution of your estate on death but more importantly, the reasoning behind your decisions and the surrounding circumstances.
A Will Clarity Statement can be crucial in helping to manage family and loved ones expectations, whilst deterring any potential claims against the Will.

What is a Will Clarity Statement?

A Will Clarity Statement is something that every Will writing company and Solicitors firm should be offering their clients when drafting their Will. Not only does it explain the WHY behind your wishes but it also includes the Where, the When, the How and those Who.