Will you be taking advantage of reduced IHT

David Cameron, Nick Clegg and Ed Miliband have all agreed to give one tenth of their estates to charity when they die.
In an unusual cross-party move, the three leaders have signed up to support a campaign called Legacy10 to promote charitable giving.
Under government plans to promote the campaign – which Mr Cameron sees as part of his Big Society agenda – new inheritance tax laws will also encourage legacy giving. 

With effect from April any estate which leaves at least 10 per cent of its taxable wealth to a charitable cause will be able to take advantage of a reduced rate in inheritance tax, from its current level of 40 per cent down to 36 per cent.
The leaders join a growing band of businessmen and celebrities who have made the pledge, including Sir Richard Branson, architect Lord Rogers, Charles Dunstone – co-founder of The Carphone Warehouse – the banker Jacob Rothschild and Olympics boss Lord Coe.
 
Downing Street confirmed that Mr Cameron and Mr Clegg had agreed to sign up to the pledge.
 
In a statement to the Mail, Mr Miliband said last night: ‘I’m delighted to be supporting this important initiative.
‘I hope the commitment will encourage many others to consider committing to leaving 10 per cent of their estate to charity in their will.’
Leading lobbyist and PR man Roland Rudd, founder and chairman of Legacy10, said: ‘I am so pleased all of our main political leaders have not only chosen to support Legacy10 but have made a personal commitment to change their wills to make the pledge.’
 
Mr Cameron is paid £142,500 but is thought to be worth several million pounds. His aides have denied suggestions he is worth £30million.
 
Cabinet ministers such as Mr Clegg are paid £134,565 and Mr Miliband gets the same.

At the moment 74 per cent of people support a charity during their lifetime but only 7 per cent of the UK population leave a charitable gift in their will

Gifts to Children - A Cautionary Tale

When writing a Will it is highly possible that there will be a gift to a minor contained within it, or the possibility of a minor inheriting under a per stirpes clause. It is worth considering what actually happens with such a gift and who should act as a Trustee in such circumstances.

Money can bring out the worst in people as Claire Sproston found out after discovering her father and stepmother had stolen the inheritance she had been left in her grandfather’s Will Miss Sproston’s grandfather, Benjamin, passed away when she

was just 13 and had made a Will naming his six grandchildren as Beneficiaries, each receiving an equal share of his £50,000 life savings . Miss Sproston’s inheritance was placed in trust until she turned 18.

When she reached the landmark age, Miss Sproston enquired about the money only to be told by her father, Nigel, that he changed the trust and she would have to wait until she was 21 to receive her inheritance. It was only after Miss Sproston consulted her cousins that she realised something was afoot and that her father would not have been able to alter the terms of the trust. She promptly went to see a solicitor who discovered the sad truth; her inheritance had gone.

Nigel Sproston and wife Jane were found guilty of fraud at Cardiff Crown Court and jailed for ten and nine months  respectively. The couple lied to solicitors and an investment company as well as forging Miss Sproston’s signature in order to get their hands on the £13,000 inheritance. The Telegraph reported that Nigel Sproston, who pleaded guilty to fraud, told police he “spent £2000 of it paying off debts, £5000 on a holiday for myself, gave £1500 to charity and the rest just got frittered away.”

His wife denied the charge but was found guilty nonetheless. Speaking after the verdict, mother-of-one Miss Sproston, now 22, said: “I’m still denying to myself, really, that either of them could have done what they did. When I first found out what my father had done, he told me he did it out of anger because we were naughty as kids.” “My dad has never told me what he did with my money. I don’t know if I will ever get it back.”

It is always worth ensuring you know and trust whoever it is you are appointing as Trustees. Contact us for further information or to discuss Professional Trustee options (info@abbottswills.co.uk or 0845 313 3353).

Lasting Power of Attorney...Why??

Lasting Power of Attorney is a document your chosen attorney/s can use on your behalf if you become incapable of dealing with your property and financial affairs

When we think about this document most of us relate this to age. We tend to think that this document is for the elderly as there is more chance of them developing dementia than someone in their 30's or 40's.

How wrong we are.

Yes stats do show that at least half of people aged over 80 will develop some form of dementia making it impossible for them to deal with their property and financial affairs. But what about those of us who jump in our cars everyday speeding down the motorway to get to our next appointment or business meeting or those of us riding motorbikes? What if we had an accident and didn't die but suffered quite badly perhaps ending up in a coma or suffering from some kind of brain trauma making it impossible for us to deal with finances and property?
You're not dead therefore your Will wouldn't kick in. Anything in your sole name would need to remain untouched also joint assets could be frozen, this could put huge financial strain on your loved ones. Simple things like paying bills just couldn't happen unless your spouse / close relative applied to the Office of the Public Guardian for Deputyship. A really lengthy and expensive process.

So there is a need for a Lasting Power of Attorney no matter what your age. It is like an insurance policy hopefully you will never need it but if you ever did thank goodness you had it.


(Abbotts charge £175 plus VAT for 1 LPA and £275 plus VAT for a Couple) 

Death - It really can happen at anytime

I certainly don't wish to be the bearer of bad news as we enter 2012 as generally people are trying to feel positive about the year ahead still sticking to their New Year resolutions etc. However what I am about to say isn't anything new.

I am sorry to break it to you but we are all going to die. We don't know how or when but trust me it is going to happen. I hope it doesn't happen for years and years and years and like you I want to see my children grown up and perhaps even meet my grandchildren.

However, as we all know there are no guarantees in life well apart from two; death and taxes.

I meet a lovely lady today who wishes to get her Will done because she unfortunately lost her husband 3 months ago. He caught a virus and 11 days later he was dead - just like that. I was a little taken back as she was probably a couple of years older than me (~34), her husband was 36 and left her and their 6 year old daughter.  Luckily he had a Will so thankfully at least the practical side of things is simple to sort out.

A recent survey from Brewin Dolphin (investment manager) found that 63% of people did not have a Will and those surveyed blamed a lack of time, being too young or not having enough money....sound familiar??

A will doesn't take too much time to draw up...perhaps a hour of your time, the above story proves that you are never too young and as for expense we charge £100 for a Single Will and £180 for a Mirror Will - that's not too expensive is it?

You never know when death is going to occur but for goodness sake be prepared and organised. Stick to one of your New Year Resolutions and make your Will to ensure those around you are financially looked after and guardians appointed for your children.

Sorry for my rant but I do feel so strongly about this.

Are you happy to pay for your own social / nursing care in the future?

This is an interesting debate and one I come across when out and about seeing clients.

Some believe that they should be responsible for paying for their own care and others (the majority I’ll be honest) believe that they have paid and contributed enough to society and shouldn’t have to “lose their homes” to pay for their own care if they ever become unable to care for themselves.

According to Peter Hay, president of the Association of Directors of Adult Social Services, “Three-quarters of people end up needing some social care support - so this is an issue that affects most of us”.

This is quite a high figure.

An independent review said that costs should be capped at £35,000 and cross party talks that start later this month are expected to consider these plans.

But some believe the final cap may have to be higher and have warned it will not cover everything anyway.

But even with the prospect of political consensus in sight, the public will still be expected to shoulder a significant chunk of the costs.

I’d be interested to know what you think about this topic

Losing mental capacity

It is an awful time when you watch the person you love slowly but surely slip away. I don't mean slip away into death but mentally slip away. They become forgetful then forget who you are, they randomly wander. This can be very distressing. This person could become a target and be financially taken advantage of.

Statistics are showing a higher number of people are living well into their 80's. However it has been stated that at least half of those who live to be 80 plus will develop some form of dementia or Alzheimer's.

I found this to be a scary statistic.

The only way to easily protect property and finances is by drawing up a Lasting Power of Attorney. I like to see this document as an insurance policy - you may never need it but if at anytime you do it is there ready to use.

The important thing to remember is this document can only be drawn up if the donor (the person making it) has full capacity.

There is a true yet awful story of Heather Bateman a woman (True Story of Heather Bateman) who had to battle with everyone to be able to have control of her husband's finances after he was left in a coma following  an accident. It took 3 years for this to be sorted out. If her husband had made a Lasting Power of Attorney this wouldn't have happened.

So ensure yours and those around you have a Lasting Power of Attorney drawn up.