The Probate Bureau Ltd has become one of the first firms to sign up to a new scheme with hard-hitting measures to clamp down on poor practices in the Will writing sector.

The scheme which is officially launched today comes hot on the heels of the recent Ministry of Justice’s decision not to formally regulate the provision of Will writing services, preferring instead self-regulatory schemes which could provide adequate protection and redress for people making their Will. It has been given the Government’s official backing by Consumer Minister Jo Swinson, who said it will boost consumer confidence and encourage economic growth.

The scheme covers a wide range of sectors, not just Will Writing, and is designed to give consumers greater confidence in the firms that they use who display the new TSI Approved Codes logo. Consumers will be able to look for the TSI Approved Code logo, or search a dedicated database at www.tradingstandards.gov.uk, for a firm in their area which complies with an approved code.

TSI Chief Executive Leon Livermore said “The Government recognises the importance of the new scheme, because any Will writing firm who says that they comply with the code of practice, but doesn’t, or falsely claims that they do comply will be committing a criminal offence for which they could face fines or imprisonment.”

Baroness Crawley of Edgbaston, who is the chair of the independent board that will evaluate the codes of practice which will be part of the scheme said: “Industry is well placed to understand the demands and expectations of their customers, but those consumers need the added confidence that industry codes have been verified as fit for purpose by an independent body.”

The Institute of Professional Willwriters Code of Practice contains hard-hitting measures to clamp down on poor practices in the Will writing sector which have typically been a problem for customers, such as; low levels of skills of advisers; poor quality of work; loss of money paid in advance; high pressure sales including failure to honour ‘cooling off’ cancellation rights and opaque options to complain and obtain redress when things do go wrong.

The Probate Bureau director David West said ‘For many years firms, as a condition of our membership of the IPW  we have been operating to high standards and we’re delighted to be early adopters of the new standard. It’s great news that consumers in the Hertfordshire and Essex area will now easily be able to spot a trusted Will writing service simply by looking out for new TSI Approved Codes logo, or by visiting the Trading Standards Institute website’.

Gillian Guy, Chief Executive of Citizens Advice said, “We deal with over a million consumer problems each year and know how difficult it is for people to find a seller they can trust, the Approved Codes Scheme will help to combat this”

In general,  a person is able to leave an estate worth £325,000 before paying Inheritance Tax.  This is known as the ‘Nil Rate Band’.

If an estate is in excess of £325,000, tax is charged at 40% on the excess. For example, an estate valued at £525,000 would be liable to pay £80,000 in tax!

However, since October 2007, the Nil Rate Band can be transferred between spouses or civil partners. As a result, a married couple could have an allowance of £650,000 on the second death.

If you are dealing with an estate where you believe Inheritance Tax may be payable, or wish to save tax on your own estate, then please contact us for advice on 0800 028 2837.

When discussing estate planning with clients, in particular making their Wills, people often decide to put off making any decisions and say that they know they need to get round to it but they’ll deal with it later. A few of them will come back and address their Wills a few months later, but a large number never do. It is for this reason that the percentage of people dying intestate (without a legally binding Will) in the UK is currently between 60-70%!

Below are two thought-provoking case studies which highlight why it is so important to actually get round to making (and signing!) your Will.

1. Many people think that you only have to think about making a Will as you get older.They would be well advised to consider the case of 35 year old John Lockwood* who died unexpectedly in a car crash. He did not leave a Will. As he was not married and had no children, his entire estate was to be divided between his parents in accordance with the Rules of Intestacy.

John’s father had divorced his mother when he was very young and had since played no part in his upbringing. However, it was John’s mother’s responsibility to trace his father and when they did find him, he accepted his full entitlement of 1/2 the estate.

John’s mother and siblings had to sell his house and all his belongings and then hand over half of the proceeds to his father, who had not even seen him for 20 years.

Had John made a Will, he could have chosen to leave everything to his mother or brother, rather than to his estranged father.

2. Another client of ours, Henry Sommers*, appointed us to extract the Grant of Probate in his mother’s estate. She had left around £20,000 as well as a house, which all passed under her Will to Henry.

After we had completed the probate application for Henry, we asked him whether he wished to arrange an appointment to make his own Will, in light of the substantial inheritance he had received. Whilst he recognised that this would be necessary at some point, he advised us that he first wished to tie up his mother’s estate and that he then planned to propose to his partner of 10 years, Barbara.

Three months later, we received a call from Barbara in floods of tears to tell us that Henry had died suddenly at 52. At the time he died, he had not made a Will, nor had he married Barbara.

This left his long-term partner in a terrible situation, she had no entitlement to his estate and faced homelessness as she was living in Henry’s late mother’s house. We had to advise her that it was his closest relatives, cousins in Australia, that would be responsible for applying for probate as well as being entitled to the estate.

The only chance Barbara had of recovering anything from the estate was to make a claim, once probate had been granted, as a dependent of the deceased.

*All names have been changed to protect the identities of those involved

Not many people will have ever pondered the country of their domicile. Indeed, the vast majority of people living in the UK would doubtless assume that they are UK domiciled by virtue of the fact they live here.

This is not the case, and the implications of falsely assuming that you are UK domiciled can be immense. Not only does a ‘non-dom’ status potentially affect your Income Tax and Capital Gains Tax position, but it also dictates the Inheritance Tax treatment of your estate upon death. Therefore, before beginning any estate planning, domicile should always be established.

In 2010, statistics showed that 11.3% of the UK population is foreign born. Therefore, at least 1 in 10 people could be considered non-domiciled.

So what are the factors that determine domicile?

1. Everyone will automatically be born with a ‘domicile of origin’ which would generally be determined by considering the domicile of your father at the time when you were born. As such, anyone whose parents were born abroad or living abroad at the time of their birth could be considered a non-dom.
2. Once an individual reaches adulthood, it is possible to obtain an alternative ‘domicile of choice’ if for example they are living in a different country to that of their birth.
3. When assessing whether the ‘domicile of origin’ or the ‘domicile of choice’ takes precedence, various factors need to be considered such as the strength of links to each country and how long the individual has been resident in the respective countries.
4. Prior to 1974, women automatically assumed the domicile of their husbands when they married. It may come as a surprise, but this means that any woman who married a non-dom before then could be considered a non-dom herself for this reason.

If you are in any doubt about your status, then it is advisable to speak to an expert, particularly if you fall into any of the categories mentioned above. Please call us on 0800 028 2837 or complete our online enquiry form providing brief details of your circumstances.

It is surprising that one of the groups of people least likely to have an up to date Will are the parents of young children. In fact (according to a recent survey) a staggering 79% of those with children living at home do not have a Will at all!

Aside from the standard complications that can be cause by dying intestate, the absence of a Will when minor children are involved causes further problems as no guardians have been appointed to care for the children. Who then becomes responsible for their welfare?

One might assume that the surviving parent simply acquires responsibility for the child. However, things are not as simple as this. The reason being that the surviving parent would need to have ‘parental responsibility’ over the child for this to happen. This child’s mother would almost always have parental responsibility, but the fathers may or may not. We will not go into detail as to how this is determined but suffice to say that it depends on various factors including whether they are married to the mother and if they are named on the birth certificate.

Many people think that if they were to die, then grandparents, aunts or uncles could just step in and look after any children they leave. This is not the case. If no guardians have been appointed then the children would be placed into the care of social services, pending a decision on who receives permanent guardianship.

Currently, approximately 4 out of every 5 parents are running the risk of assuming that at least one parent will be alive at the time that their youngest child reaches the age of 18. No one likes to think about the possibility that this might not happen, but is it a harsh reality. In fact, every 22 minutes a child in the UK loses a parent.

One of the most responsible things a parent can do for their children is to write a Will appointing guardians to look after them. This is the only way of achieving peace of mind that, should you not be around, your children would be well looked after by people you trust.