Tony Crocker

Tony Crocker is Director of IWC Estate Planning & Management Ltd. With over 15 years’ experience, he is knowledgeable and proficient in all matters regarding Probate, Will writing, Estate Planning and Inheritance tax avoidance. In addition, he has a wealth of experience in dealing with estate settlements and issues with the capital taxes office in the event of bereavement. As a member of the Society of Will Writers & Estate Planning Practitioners, he is widely respected within the field, having helped many people at difficult points in their lives through complex probate and tax issues. Tony Crocker

New HMRC guidance on reduced IHT rate for charitable gifts

HMRC has just published new guidance which will clarify rules on the reduced rate of inheritance tax for charitable gifts.
 
As from April 2012, if a deceased’s estate pays out at least a 10% donation to a qualifying charity, the whole estate will then be charged at 36% liability, rather than the usual 40%, if it is valued over £325,000.
 
It must be bourne in mind however, that there may well be several chargeable elements to an estate.   These elements often include assets which the person owns jointly with someone else, assets in trust and assets which they own totally or as tenants in common.
 
It is possible therefore, that even if a percentage of the estate is left to a qualifying charity, only a portion of the estate is then taxed at the lower rate, with the rest of the assets being charged at the usual, 40% rate.
 
To find out whether your will is likely to attract the full reduction in liability, you are advised to contact a professional estate planner.

French probate v English probate dispute for Matthews estate

Once more, the issue of owning foreign property has led to an overseas probate dispute, which has arisen after the death of British food millionaire, Bernard Matthews.
 
In addition to English assets, the late Mr Matthews also owned a £12m villa in the south of France. After his death, it was his long term French mistress who was originally to inherit the villa – his adopted children were not named as beneficiaries, but instead claimed their right to the property under French inheritance law, despite specific written instructions to the contrary, given by their deceased father.
 
Once they had secured the villa, the three children in question then went on to contest the £2m inheritance tax bill they received on the property, declaring that the funds should be paid from their late father’s English estate – a move which would see their tax liability discharged.
 
The High Court however, ruled that the children had no right under the English will to take this action, given that Mr Matthews had not wanted them to inherit the villa in the first place.

Dispute over millionaire’s foreign will

Having homes in more than one country can easily pave the way towards creating ambiguity and dispute after your death, if your wills are not prepared fully and accurately.
 
It is always recommended to seek expert will writing advice if you choose to live for at least part of the year outside of the UK, as the probate process can become very complicated and a contentious probate dispute can arise as a result.
 
In this instance, millionaire businessman Piero Curati lived principally in the UK and so had a will written here. However, he also had previously had one prepared in Italy, where he was born and so the question arose whether his first will had in fact been revoked by the one made in the UK.
 
This ambiguity led to a dispute between the late Mr Curati’s niece and nephew, and his sister. In the first will, the niece and nephew were set to inherit the entire assets of the will, worth just under £2m after tax. However, in the UK will, his sister was set to become sole beneficiary.
 
The argument now rests with the High Court, who will decide which country was deemed to be the deceased’s main residence and from that, who stands to inherit his estate.

Changing a trust

Once a trust has been set up, it is possible for a beneficiary to change the original terms of that trust, whether it be to minimise potential taxes or to adapt the deed to make it more suitable for updated family circumstances.
 
Usually, in order to change a trust, all the beneficiaries must give their permission, therefore changing the trust by agreement. In this instance, the process can often be relatively straightforward.
 
All beneficiaries must sign a deed of variation, declaring the changes which are to be made to the trust. The deed is then passed to HMRC so that the amendments can be formalised.
 
On rare occasions, whereby an agreement has not been reached, the court does have the power to amend a trust. In this instance, a court application must be made. It must be noted however, that courts are often reluctant to interfere with the original contents of a trust and so appropriate advice should be sought.

Bee Gee complicated probate could take five years to complete

Most of us wish we could live the life of a millionaire – no money worries, houses around the world and exotic holidays.
 
However, having a significant amount of money also brings with it its own problems, even after death.
 
A complicated estate can mean that the release of assets can be considerably delayed as a result of the probate process, as is now being seen with the estate of the late, great Bee Gee, Robin Gibb.
 
Robin left a whopping estate of £93 million, made up of several businesses and property in Oxfordshire, Miami, London and across the globe.
 
It wasn’t only his assets which posed complications however – his personal life, which saw his relationship with his housekeeper produce a child, resulted in a £5 million settlement made before his death.
 
 All this means that his lawyers are now battling to piece together what needs to be done as part of the probate process, in order to reach a point whereby relevant taxes can be paid and the millionaire’s assets can be distributed to his beneficiaries – a process which, it has been estimated, could take up to five years.

UK right to die case halted again

We’ve all followed the sad case of Tony Nicklinson who, whilst he was alive, suffered from locked-in syndrome and fought to the very end to be allowed the right to die.
 
Unfortunately, Tony’s plea ultimately fell on deaf ears and he died from pneumonia shortly after he learned that his case had not been successful.
 
His family fight on however, supporting Tony’s cause – to allow others with locked-in syndrome, to be given the choice of life or dignified death.
 
This latest round of legal wrangling has seen the High Court refuse to allow Mr Nicklinson’s case to be heard by the Court of Appeal – a bitter blow for his wife and family.
 
Lord Justice Toulson offered sympathy for Mrs Nicklinson but felt that the case was not a matter for the court, but for parliament.
 
In response, the Nicklinson family have vowed to fight on, via the Courts of Appeal.

Probate and banks – a varied service

 

It seems that there is no standard provision of service among banks, for those who are looking to settle their deceased loved one’s financial affairs.
 
A newspaper reported a case whereby a lady had bank accounts with Halifax, Barclays and Nationwide.
 
After the lady’s death, her executor arrived at Halifax with the necessary documentation, including ID, her will, her death certificate and an invoice for the funeral costs. As this was a relatively small estate, staff quickly and sensitively processed the necessary information, closed the accounts and provided the executor with a balancing cheque.
 
It was a different story however, at the latter two banks who between them, had to pass the request to a different department, then asked for probate to be produced and a completed authority and personal indemnity form to be sent to them by post, adding considerable delay to what should have been a relatively straightforward procedure.
 
Carrying out your role as executor can sometimes be more complicated and take a greater length of time then absolutely necessary. In these instances, seeking the help of a knowledgeable and experienced probate practitioner can be helpful.  At IWC we will also give you an accurate cost for probate before we undertake any work.

Pension from property scheme falls at the first hurdle

It seems that Nick Clegg’s idea of allowing parents or grandparents to use tax-free cash lump sums from their pension funds as a guarantee for their children’s or grandchildren’s mortgage, is beset with problems.
 
Presently, many young adults are not able to get a foot on the property ladder due to requests by mortgage lenders for large deposits, forcing them to spend vast sums of money monthly on rent payments.
 
Mr Clegg’s proposal was that grandparents or parents would be able to offer their tax free lump sum as a guarantee, in cases where deposits could not be paid.
 
However, legal professionals have argued that this lump sum cannot at present be allocated to specific mortgage lenders and that parents or grandparents cannot be forced by mortgage companies to offer the money as an alternative to a deposit.
 
The government then, has been criticised yet again for not thinking this strategy through properly, before announcing it to the British public.

Why it’s important to discuss your inheritance

How do you as an adult approach the sensitive topic of inheritance with your elderly parents? Do you make light of it or do you simply avoid the subject at all costs?
 
In a recent survey by Investec, around 74% of adults said that they had never discussed the subject, worried that they would be perceived as being money grabbing or simply reluctant to acknowledge their parents’ immortality.
 
Having this discussion whilst they’re alive however, can make all the difference when it comes to understanding the terms of their wills and ensuring that probate is processed as quickly and smoothly as possible.
 
As well as potentially avoiding family squabbles during a time when everyone should be united in their grief, being aware of the details of the inheritance and estate as a whole could in fact unearth information which could help towards reducing inheritance tax liability when it falls due.
 
By having a sensitive yet open discussion with your parents, you could discover that their wills are out of date and need to be updated to reflect a change in family or financial circumstances. If their possessions are currently valued over £325,000 singly or £650,000 jointly and they have no estate plan in place, it may be time to visit a professional estate planner, who can advise on ways to minimise inheritance tax, which will otherwise claim around 40% of proceeds.

Banks sign up to probate protocol

How many times have you heard of banks and building societies dragging their heels during the probate process?
 
This problem has been addressed in recent weeks, with several regulatory bodies including the Society of Trust and Estate Practitioners (STEP), supporting a new protocol, which will go some way towards regulating communication between banks and estate practitioners during the vulnerable probate period, allowing practitioners to have more power over when and how a bank or building society should release assets held by the deceased.
 
Major financial institutions including Barclays, the Royal Bank of Scotland, HSBC, LloydsTSB, Halifax and NatWest have all signed the new protocol.
 
This move should mean that with smaller, less complex estates especially, executors and beneficiaries should see estates being wound up and assets released faster.

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