In probate terms, a caveat is a way to have a look at someone’s will if the executor of the estate is reluctant to let you see it. You may want to contest a will, and to do so you will need to have a copy of the will that you have a problem with. The easiest way to get a copy is to speak to the executor and ask for one, but they may refuse for a number of different reasons. If you still want to see a copy of the will, lodging a caveat could help you.
A caveat is issued by the Probate Registry and is a legal document which prevents a Grant of Probate from being issued. It basically stops probate from even beginning, and can remain in place for up to six months. This can have a huge impact on the estate of the deceased and the beneficiaries who are waiting for their inheritance.
A caveat could be used if you have concerns over the validity of the will itself, or if there is a dispute between anyone included within the will and the executor him or herself. It can also be used if you have any concerns about whether the testator had the capacity to write the will in the first place, or if you are worried about any potential fraud issues.
Remember, however, that an executor can have the caveat removed if they believe there is no reason for it. One way to do this is to issue a warning on the person who has entered the caveat. The caveator will then have eight days to enter an appearance – this is used to explain the full reason behind the caveat.
It is best to talk through the problems with the executor before immediately entering a caveat, which should really only be used as a last resort.
Some people try to avoid probate if at all possible. And there are ways around it. But before you start to go down that route, are you sure that you don’t want to go through probate? Yes, it can be complicated and it can take a long time, but equally it can be simple and could be quick. And there are a number of benefits.
One major benefit of going through probate is that any creditor who has not yet filed a claim against the estate will have to claim within four months, rather than the year that they would have without probate. This can mean that less money has to be paid out of the estate to cover outstanding debts.
Property cannot easily be put into trust without probate. Putting a property into trust keeps it ‘safe’ for future generations or a later date. But you need to have the title to that property in your name, and this can often only be done through probate.
Probate can be an ordeal, but the benefits might be of use to you and mean that it is worth the hassle. And don’t forget, you can hire a solicitor or lawyer who is a probate specialist to help you. They can help you with the paperwork, advise you or what course to take, and even work out a plan for probate in general.
Inheritance tax planning sounds like something that only the rich and famous need to really think about, but is it actually something that everyone should consider? Although it may seem as though it’s only something that affects other people, inheritance tax can actually affect anyone and everyone, so ensuring that your estate won’t fall foul of the laws is an important part of creating your inheritance plan.
Inheritance can affect more people than you might think because once you add up your estate – savings, belongings, life insurance proceeds, your pension, and your property, it could well be over the threshold for having to pay inheritance tax. When property involved this is even more likely since house prices are rising.
There is an inheritance tax allowance of £325,000 on any estate. If the estate is worth more than that then tax will be owed on the ‘extra’ amount, and it is payable at 40 percent. However, if you have a spouse or a business interest (or both) then it is possible to carry out inheritance tax planning through your will. It could be that inheritance tax won’t be due at all since there is a spousal exemption from the tax, and also business tax relief.
If you are single, living with a partner but unmarried, or you have no business then your will may not be able to help you reduce inheritance tax. But there are other things you can do. For example, everyone has an annual inheritance tax exemption of £3,000 which can be used to give gifts. If you give more than £3,000 the rule is that you must ‘outlive’ the gift by a further seven years (otherwise it could still be subject to inheritance tax).
The best thing to do is to contact an expert who will be able to talk you through your options and reduce your liability for inheritance tax as much as possible.
Every will must have an executor. That’s the law. Or is it? Well, although it is true that there must be an executor for each will, the truth is that there must be at least one executor. In reality, it is perfectly valid and possible to have more than one should the testator require it. But why would more than one executor ever be needed?
In law, as many as four executors can be named in a single will and, if necessary, all four (or up to four) can apply jointly for probate. Once probate has been applied for, whomever is named as executor must continue in that role – but before this happens they can step down in need be. If this happens, and more than one executor has been named, then probate can still go ahead as there will be one, two or three other executors to take on the work. Executors should be told that they are being named as such in a will before the testator dies, but sometimes this isn’t the case and therefore it could well be that some of them may wish to walk away from the position. Having more than one executor makes this much easier.
Once probate has been granted, the executors must work together to make the process run smoothly. This can be difficult with more than one executor, and the concern is that some jobs won’t be done at all as everyone thinks someone else is doing them, and some jobs will be done more than once as everyone thinks it is their job to do. The best way that multiple executors can deal with the estate of the deceased is to work together, discussing all decisions before acting. It is fair, although it is time consuming and can sometimes be difficult to get in touch with everyone.
In this case, one person should be named as ‘lead executor’. How this person is chosen is not particularly important, although if someone has experience or knowledge of probate then they may well be the best person to choose. Alternatively, the executors can apply jointly to appoint a solicitor to carry out the work for them.
Many of the UK’s biggest banks have limits on the amount of money that is allowed to be released from deceased customer’s accounts without the need to apply for probate first. However, these limits are set to increase for some banks.
Normally a bank or building society will freeze the accounts of someone who has died. This is in order to give the executor the time to apply for the grant of probate. However, this process can take a long time – sometimes months, and, in the case of incredibly complicated estates, years. The executor will be able to access money required to pay for any funeral expenses and inheritance tax that might be owed.
Some banks also allow small amounts of money to be withdrawn to give to bereaved relatives as long as a death certificate can be produced. Each bank is different, but in general, the amounts that were allowed to be withdrawn without probate would be between £15,000 and £20,000.
Recently, however, some high street banks and building societies have agreed to raise this limit. This will help those who are trying to wrap up their deceased relative’s estate and ease the burden at a difficult time. The Royal Bank of Scotland, for example, has raised its limit from £15,000 to £25,000. Lloyds Bank has raised its limit from £25,000 to £50,000. HSBC has removed its upper limit and has said that it will assess each case individually. Nationwide are looking at doing the same thing.
The raising – or removal – of these limits will mean that the estate can be dealt with much more quickly, and although probate will still be required for other assets, at least those left behind will be able to continue their lives without money being too much of an issue.
Inheritance tax can, at first, be an inexact science. Although it may seem as though it is something that can be calculated exactly, there are various factors that mean it is sometimes overpaid. Equally, your inheritance tax payment can be underpaid too. Why is this?
When someone dies the estate will often have to pay inheritance tax (IHT), assuming the estate is worth enough for the government to charge IHT on it. The executor will need to fill in a tax return and pay the money calculated to HMRC. Only after this will they be able to obtain probate and distribute the assets.
The difference in the figures comes when an asset – for example a property – is sold for more or less than the valuation. With properties this is very common, and they do often sell for less than the asking price. However, the tax returns and the payment will already have been made at this point, and therefore the overpayment will need to be recovered. Equally, if the property (or other asset) sold for more, an additional payment will have to be made.
If an overpayment has been made then you will need to contact the Capital Taxes Office (CTO) which is part of HMRC. Unfortunately the process of recovering money like this can take many months, even in the most straight forward of cases. This can cause a major impact on the distribution of the rest of the estate, as everyone has to wait until the money is returned.
Wills can be challenged for a variety of reasons. One such reason is that of ‘undue influence’ exercised over the person who wrote the will. If this is alleged to have happened, then the person who has made the allegation will need to prove that it did, indeed, happen. That can be a difficult thing to find evidence of, especially as the person who would have the answers is sadly the one who has died.
Alleging undue influence often happens when one sibling stands to inherit a large majority of an estate, and their siblings believe that the only reason for this is that they exerted this undue influence over their parent. It may or may not be true, of course.
But what does the term undue influence actually mean?
Firstly, it is not enough to say that mere influence was involved. It has to be seen as undue. Simply suggesting ideas to those who are considering writing their will may not be wise, but neither is it illegal or unethical. Undue influence is. An example of undue influence could be if a carer were to completely isolate their charge from their friends and family, making them entirely dependent on them – and then putting pressure on them to look favourably on them in their will. Or it could be that one child tells lies about their siblings, and keeps on at the parent until they believe the lies despite their better judgement.
If a solicitor is concerned about the reason behind any sudden changing of someone’s will, they will often ask to see the testator alone, to discuss the changes with them and ensure that no undue influence has been at work. However, without any direct proof, or any information from the testator, there is not much that the solicitor themselves can do.
In order to prove undue influence, the claimant must show that the defendant was able to exercise the influence and that they did so. They must also show that the influence was, in fact, undue and that it related directly to the will. It is extremely hard to do this, but ways to try to prove undue influence include witnesses, medical evidence that show the testator was frail either mentally or physically, social workers and carers, family members, and solicitors.
There are a lot of different solicitors out there. One of these types of solicitor is a probate solicitor, and these are the people who are experts in dealing with any kind of probate dispute – no surprises there!
Unfortunately, this is not always realised, and there was a case recently when a woman hired a firm of lawyers to help her dispute a claim that had been made by family members regarding a will. She had been left a large sum of money, and the family members deemed it to be unfair. They disputed the will, and it went to court. So of course, the woman in question was right to hire a solicitor to help her. The problem was that she had hired a firm of conveyancing solicitors (those who help with the buying and selling of property), instead of probate solicitors. This caused a big problem for everyone involved.
The firm was not licenced to work on probate or litigation situations, but lawyers went ahead anyway. Unfortunately for the woman who hired them, the firm went into liquidation soon afterwards, so although they should have paid the fee (£87,000) back to the estate, they cannot, and it falls to the person who hired them to do so. This money should have been kept in a safe account, but it was moved to the general account of the conveyancing firm and lost when the business closed.
This equates to around £550 an hour.
A lasting power of attorney is a tool that you can use to give someone authority to make decisions for you if, at any time in the future, you lack the mental capacity to do so for yourself. The lasting power of attorney can be used for both financial and medical or care decisions.
In financial situations, the lasting power of attorney can be used for buying and selling property, mortgage payments, investments, ensuring bills are paid, and arranging any repairs that need to be made to properties. When it comes to healthcare, it can cover everything from where someone should be cared for (at home with a carer, in a home, or in a hospice, for example), what kind of care should be provided, and even end of life decisions including continued care.
If you choose to name someone as your lasting power of attorney it must be someone you trust, and with whom you can have meetings to work out what should or should not happen in specific circumstances. In financial situations, whoever is your power of attorney must keep detailed accounts of anything that is spent.
In order to set up a lasting power of attorney, however, you must be in good mental health. This is not something that can be done if your mental capacity is already failing. Equally, you must not have made the lasting power of attorney under duress. It will need to be signed by someone in a professional capacity such as a solicitor, doctor, or social worker. Once this is done, the LPA must be registered with the Office of the Public Guardian before it can come into effect.
The living will has now been replaced by the more secure lasting power of attorney – however, living wills written before 2007 are still valid.
The phrase ‘living will’ rolls off the tongue with ease, and it seems as though script writers enjoy adding it to their murder mystery or FBI investigation programmes with impunity. But although we’re all heard the phrase, and although we might think we know what it means (in terms of the story on TV that we’re watching), there could certainly be nuances that we’re missing.
A living will can also be called a health care directive, advance directive, or physician’s directive. It is similar to a standard will since it is used to write down one’s wishes should something happen – should a specific set of circumstances occur. However, whereas in the case of a standard will that specific set of circumstances is the testator’s death, with a living will it is quite different. As the name suggests, with a living will it is not death that will move the items within it to be carried out, but instead a life that is drastically altered to the one that you were living. If, for example, you were to be involved in an accident that left you alive but in a permanent vegetative state, or a terminal illness that resulted in an end of life coma, the living will could come in to affect.
Not everyone needs or wants to write a living will, but for some the idea of being kept alive solely through machines is a terrifying one, and not something they want to happen to them. A living will will ensure that they are not forced to ‘live’ in such a way. As medical advances continue, death is being pushed further away from many people which, in most cases, is an excellent thing, but when it comes to a case in which death would have been preferable (for the person involved), then the living will can help allow that death to happen.
Through your living will you can instruct medical professionals (at the same time informing your family) that you wish for no ‘heroic measures’ to be taken to keep you alive, and neither do you want any medical intervention including life support machines. The living will can be incredibly specific, allowing you to mention exactly what techniques and medications you would not allow – and the ones you would.
The living will is a way that someone can make their wishes heard when they are unable to speak for themselves. For some, however, the idea of creating such a document sounds like a dangerous thing – what would happen if you were involved in an accident and were unconscious and the living will was invoked even if you could have been saved and gone on to live a perfectly normal life? There is no need to worry about that – the living will is only used when the patient is in a permanent state of unconsciousness. This would need to be certified by medical professionals. Simply being unconscious after an accident would not trigger the living will, and you would be treated as anyone else would in the hospital.
A living will is not something you need to write instead of a standard will; you can have both. However, there is little point in having a living will if no one knows about it – if no one knows it exists, how can anyone action it? So if you do choose to write one, make sure you tell your family about it. Tell your friends. Tell you GP. Tell a solicitor. Make sure that it can be found should anything happen. And make sure that it is drawn up by a professional so that there are no quibbles or questions asked about it. There must be no doubt about what the patient’s wishes are, even if the family does not agree with them.