There are normally 3 general types of basic gift in a Will, specific gifts, pecuniary gifts and residuary gifts. These have various sub-categories but we advise you seek proper advice on these as they are more complicated than there is space to explain here.
Unless the Will states otherwise, any gift passes free of tax. This means any tax must be paid by the estate and comes out of the residue before this is distributed.
A gift can create an absolute interest (it is yours to do whatever you wish with), a life interest or interest in possession (it is yours for only as long as you are alive) or an interest on trust (you are entitled to the benefit, but someone else, known as the trustee, decides how you should have this). Where the gift is to a class of people, then it can vest immediately, be deferred to a later date or be contingent (e.g. be for children of a certain person who reach the age of 18).
You can leave money or other gifts to whoever you like. However, if immediately before your death you have left a spouse or civil partner, or have been co-habiting with someone for at least two years, or at your death you were paying maintenance to a former wife or a child and you have not made reasonable financial provision for them in your Will, then under the Inheritance (Provision for Family & Dependants) Act 1975, any of these can apply to the Court for a share of your estate. What constitutes “reasonable” is for the courts to decide and will be different in each circumstance. We are specialists in this area and can advise you according to your circumstances.
For Wills made prior to 1970 any gift to children is deemed to only include legitimate children unless the Will states otherwise. For Wills made from 1970 onwards gifts to children include both legitimate and illegitimate children. An adopted child is regarded as a legitimate child.
Sometimes a person who has been gifted in a Will may also have passed away. This generally means the gift is not able to be given, in legal terms this is called “failing”, as generally you have to survive the person who made the Will for the inheritance to be received. Where any gift in the Will fails for whatever reason, it can either pass elsewhere if rules or the Will provide for it, or it will fall into the residue and distributed as the Will prescribes.
It is vitally important to ensure the wording for Wills is as specific as possible, as it could be interpreted differently in the future.
Let’s look at a simple example: someone states they wish to leave their car to their eldest child. This seems simple enough, but what if the eldest child has passed away before the parent, leaving another child to become the oldest – what should happen then? Also, what if the car had been changed since the Will was made, would it still mean the new car should be given to the eldest child? In most circumstances these questions can be answered easily by the Executors and/or the beneficiaries. However, if there are disagreements or perhaps certain members of the family don’t get on or are estranged, it can lead to problems. These problems can quickly escalate and could result in increased legal fees which will generally need to be paid from the estate, meaning the beneficiaries will receive less.
It’s a much better idea to spend a smaller amount of money now and ask a solicitor to help draft your Will or at least check it for you. We offer both of these services and can ensure your Will is worded correctly and that your wishes will be interpreted as you want.