No one knows what their future holds; and in today’s world of blended families and ever-increasing care costs, it’s important to consider how you might protect your property after your death.
A simple Will stating what you want is not always enough to protect property inheritances for your family.
Most people who co-own their home with another person do so as joint owners. This means they both own the whole property. On the death of one of the joint owners, the home AUTOMATICALLY becomes the property of the survivor – they can then do what they want with it. This can, however, cause problems.
What if the survivor then re-marries? It is possible that the whole of the house will then pass to the new spouse on their death, thus disinheriting children of the first marriage. There are many recent examples of this happening where wealthy celebrities have died – the estates of both Paul Daniels and Bruce Forsyth received lots of publicity.
Another scenario is, what if the survivor has to go into a care home? As the property just has one owner, the Local Authority has the power to charge the cost of care against the value of the whole house – meaning that there would be nothing left for children to inherit.
What precautions can be taken to avoid this happening?
There is an answer to this problem. It is to change the way the home is owned whilst both owners are alive – from joint owners to Tenants in Common. This is a straightforward process that does not involve the mortgage company, even if the property is mortgaged. As Tenants in Common, each owner owns a share of the property (often a half share) and by using a Will Trust (a Life Interest Trust, also sometimes known as a Protective Property Trust), they can do whatever they wish with their share of the property on their death.
The idea of a Life Interest Trust is that you wouldn’t leave your share of your property to your partner – but you would leave them the right to live there until their death (or whatever date you specify). The survivor would not then own the whole property, just their half. This protects the 50% of the property owned by the person who has died, from possible care home fees or the new relationship scenario.
The survivor could only leave 50% of the property to their new partner. The 50% of the property belonging to the person who had died would be transferred into Trust, often for the benefit of children. The Trustees would then look after the 50% share of the person who had died, making sure the property is maintained and insured properly. If the survivor decides they would like to move out, they can do so as long as the Trustee agrees. If any monies are freed up by downsizing 50% belongs to the survivor, and they can also have access to the money belonging to the Trust fund if the Trustees agree.
There is also another simpler form of Trust that some people choose. It’s called a Right to Occupy Trust and these are commonly used where adult children live with their parents. This type of Trust gives the child still living at home the right to stay in the property after both parents die, without actually owning it. When the parents die he whole property is placed in Trust, often for all the children of the deceased – so when the Trust period ends the property can be sold, with the proceeds being shared between all the siblings.
Do be wary though, of taking any drastic action to avoid care costs. People sometimes think they can sell a house to a relative for a nominal fee, or even give it away, in order to transfer legal ownership. However, this could be seen as ‘deliberate deprivation’ and the sale could be reversed. Local authorities have the power to claim care costs from the person the assets were transferred to!
The local authority will ask about any previously owned assets, and take into account any reasons you’ve had to hand over assets or property to other people. They’ll consider timing, alongside any motive or intention, and also the fee.
As you can see, by making a few simple changes; sending a form to Land Registry (no fee applies for this) to change the ownership terms of your property and putting a Trust into your Will, you can protect your share of your property for your family.
It’s ALWAYS a good idea to arrange a pre-paid Funeral Plan, but in some circumstances it’s a REALLY good idea.
There are many circumstances that make it especially important to have a pre-paid Funeral Plan in place. For example:
• You may have children with specialist needs who would find it very difficult to cope with making your funeral arrangements.
• If you have very few or no living relatives then it will give you the peace of mind of knowing you’ll have the funeral you want. Plus, you avoid burdening your friends with your funeral costs and the second-guessing of your wishes.
• Maybe money is tight and you are concerned about your – or your spouse’s/partner’s – funeral would be paid for when one of you passes away? With both our Dignity and Safe Hands Funeral Plans you can pay for one plan and use it for the funeral of whoever passes away first. You can always take out a second plan later when you can afford it.
How Funeral Plans Can Help
We recently sold a Funeral Plan to a lady in her early forties. She owns a small business locally and is a single mum of a teenage daughter. Her own mum had sadly passed away a few months earlier, and she was very worried about how her young daughter would cope with all the arrangements, as well as the grief, if anything happened to her.
We were able to reassure her that if she arranged a pre-paid Funeral Plan then a single phone call would be the single action needed to arrange the funeral. It means that all her funeral wishes are now documented, and the funeral is paid for in full. She now has peace of mind that everything will be taken care of and her daughter will have one less thing to worry about. Hopefully it will be a very long time before the plan is needed, but that’s the best thing about having a pre-paid Funeral Plan – even if our client lives another 40 years her funeral will still be paid for in full. There’ll be no extra costs for her family, no matter how much the funeral costs will have increased by then.
A Sensitive, Friendly and Professional Approach
A R K specialises in dealing with more challenging situations. Our friendly approach and home visits are timed to suit you. Even if someone is unwell or has specialist needs then we can help them – whether this is with a Funeral Plan, a Will or a Lasting Power of Attorney.
Sometimes, a terminally ill person wants a Funeral Plan. This is obviously a very difficult situation for the person concerned and for their family. Recently, we helped a client who had been diagnosed with terminal cancer. They had been told that they only had a very short time to live. By handling the situation in a sensitive manner and visiting at times when client felt well enough to talk to us, we could get everything arranged and finalised very quickly; so the client and his family had peace of mind and one less thing to worry about.
To give our customers more choice we now offer Dignity Funeral Plans alongside our existing Safe Hands plans. They are similar prices and you can choose from a range of options. Your A R K consultant will help you select the provider and plan that best suits your needs.
We carry out appointments in the privacy of your own home, or by telephone if you prefer. We can then offer you that same peace of mind that our existing clients have.
Please visit our Funeral Plan page for more detailed information or contact us on 01438 746977 or email email@example.com to discuss your requirements. We you offer our expert advice for free – with absolutely no pressure to buy.
All business owners should consider a Lasting Power of Attorney (LPA) as the final piece of the business protection jigsaw puzzle.
Have you considered what might happen to your business if you:
• lost your mental capacity through illness or injury?
• were stranded abroad because of delay or extreme weather conditions?
Who would take over the running of the business on your behalf to:
• sign contracts?
• pay salaries and suppliers?
• write cheque?
• make the important day-to-day decisions to keep the business going?
Even if your bank account is held jointly with your spouse, it can be frozen until a Deputyship Order is produced by the Court. Business accounts can also be frozen, even where these are held jointly in the names of business partners or directors. How would your business cope with no funds? Many businesses in these circumstances fail.
If you suddenly lose mental capacity and haven’t made a Business LPA, it may become necessary to make an application to the Court of Protection for the appointment of a deputy to act on your behalf. The process can be expensive, and there’s no guarantee that the Court of Protection will choose someone who you would have chosen. It could also take more than six months before a deputy is appointed, during which time your business may be vulnerable and at risk.
The Business LPA and lack of capacity…
Most businesses have a Key Person Insurance Policy and crisis management plans in place, but the issue of lack of capacity is often overlooked. You might think the options are obvious, but there is no automatic legal right to deal with another person’s financial affairs. Don’t assume that a family member or a business colleague will gain the authority to make these decisions on your behalf – this assumption could leave your business exposed to risk.
To protect your interests, and those of your business, you should consider making a Business LPA.
Having a Business LPA in place allows someone that you trust – someone who understands your business – to take over the day-to-day affairs as soon as they are needed. Your attorney might be given the power to pay suppliers and staff, access and manage bank accounts, invest assets, handle tax matters and enter into contracts. Of course, you can limit your attorney’s power, but you need to ensure that the company can continue to operate with any limits in place.
The aim of all business owners is to make their business a success and to provide for their families and their loved ones. You work very hard, commit time and money to your business and have employees and suppliers who are depending on you. You have families who need your financial support and security.
It is natural to hope you will never need a Lasting Power of Attorney but why take the chance?
A Business LPA should be an essential element of your business continuity plan, and the cost of setting one up is a small price to pay for the continuing success of the business you have worked so hard to build. It’s a one-off cost as well (as long as you don’t change your mind about who you have appointed as your attorney).
A Business LPA is a type of ‘insurance’ that all business owners should have, and it truly is the final piece of the business protection jigsaw puzzle!
Our fee to arrange a Business LPA for you (including registration of the document with the Office of the Public Guardian – so that is ready to be used immediately should it be necessary) is £175 (no VAT to pay). It’s a tax-deductible expense for your company, and the only additional fee to pay will be £82 to cover the Office of the Public Guardian fee.
Contact A.R.K. Lasting Powers & Wills today for a chat about how easy it is for us to assist you with making this document that could be vital for your business. It can be arranged at a face to face meeting, or by phone/email if you prefer. Call us on 01438 746977 or email firstname.lastname@example.org.
The answer to this question is that, sadly, you never know when you are going to need it.
A Funeral Plan is like an insurance policy which protects you against the rising costs of funerals. Unlike most other forms of insurance, you know that one day you will definitely benefit from having the policy. Hopefully a long time in the future, however we will all need a funeral one day.
A Funeral Plan gives you peace of mind and security, and support for your family when they most need it. Your money will pay for your funeral costs – whenever the time comes. The money held in the plan is guaranteed to cover the cost of your funeral, even if that is 50 years away. It is safely invested in an independent Trust Fund, until your family needs it.
At A.R.K. Lasting Powers & Wills, we regularly highlight the cost of the average funeral. We know about how these costs have increased hugely over the years; and how they will no doubt continue to rise at a similar rate. We always advise our clients that buying a Pre-Paid Funeral Plan is the equivalent of buying your funeral at today’s prices, as in, say 30 years, the average cost of a funeral could be around £30,000!!
How Funeral Plans can help…
A.R.K. consultant, Julie, recently lost a close friend to cancer. He was only 60 years old and sadly died in January this year, just a few short months after being diagnosed with this horrible disease. His funeral was a real example of how costs can mount up. Without any following cars, the final bill for his simple cremation service came to over £4,500.
If there had been a Safe Hands Funeral Plan in place it would have cost £3,355 for the equivalent funeral (even with one car following the hearse it would have only have been £3,595). Hindsight is a wonderful thing – and Julie’s friend did not expect to die at 60; so he didn’t have a Funeral Plan in place. If he had purchased a plan, his family would have saved money, stress and the need to make most of the arrangements. (These have been made automatically by the Funeral Director, following the instructions contained in the Funeral Plan.)
Peace of mind re your funeral cost and wishes…
Funeral costs will only continue to increase. Please do consider arranging a Funeral Plan sooner rather than later. You and your loved ones will have complete peace of mind, knowing that the costs are covered and will know what your wishes are.
Contact A.R.K. now on 01438 746977 to discuss your requirements or to arrange a no-obligation home visit. Alternatively you are welcome to email us: email@example.com. There is absolutely no pressure to buy, and you can even pay interest free over a 2 year period (a small handling charge will apply if you wish to pay over a longer period of time). There are no hidden costs and we will explain exactly what is covered in each of the different types of plan.
“What if”? That’s a phrase we use a lot when taking Will instructions or discussing Lasting Powers of Attorney with clients
We all hope those ‘What ifs’ will never happen to us; but for one poor lady who probably hadn’t even dreamt of this particular ‘what if’, the reality of the situation was pure torture!
This is Heather Bateman’s story in her own words – we defy you to read it and then not appreciate the need to make a Lasting Power of Attorney while you are young and well! It’s quite a long story but we make no apologies for that, as the words paint the picture regarding the difficulties she faced. You should also note that this happened 15 years ago, so all the costs mentioned will have increased significantly. The
system has changed too – in those days an Enduring Power of Attorney would have avoided all the problems, but Enduring Powers were replaced by Lasting Powers of Attorney on 1 st October 2007.
This story was featured on The One Show:
Heather Bateman had to run the family finances after an accident left her husband in a coma; and thanks to the Court of Protection, three years of pain and misery followed.
“I shake as a large white envelope slips through the letterbox. My trembling fingers pull at the flap. I’m a grown woman with a family. I have done nothing wrong, yet these letters make me feel like a criminal or a helpless child. The letters are from the Court of Protection.
Never heard of it? Lucky you. I hadn’t heard of it either until the moment when my whole life fell apart.
The nightmare begins In September 2003 my husband Michael walked across a quiet country road towards me and was hit by a car. He fell to the ground and never stood up or spoke a word again. In hospital he collapsed into a coma. The three-year nightmare began.
As well as experiencing the horror of seeing the energetic man I had loved for more than 30 years rendered immobile and lifeless, I had to deal with the everyday aspects of having a large family of two children, four stepchildren and six step-grandchildren. And I had to deal with the Court of Protection.
Michael and I were two independent working people. We had been married for 28 years. We had written our Wills, both our names were on the deeds of the house we shared in London and the Norfolk cottage we had renovated over the years.
We had separate bank accounts and most of the bills were paid from Michael’s account. Now, to continue living in the way we always had done, I needed to access the money in his account.
Filling out forms Michael had been moved to the Intensive Care Unit at Addenbrooke’s Hospital in Cambridge. “You need to get the right forms,” the man at the Citizen’s Advice Bureau at the hospital told me. “Where do I get the forms?” I asked. “From a solicitor” he replied. “There are plenty of solicitors in Cambridge.”
I was in shock. I had witnessed the accident. I had seen the car knock Michael to the ground and I had held his hand and talked to him on the horrendous journey to the hospital. For as long as possible, I put off getting the forms. The solicitor’s office I chose was Dickensian. The clerk, almost as ancient as the decor, handed me some forms and said, “Fill these in and get your husband to sign here.”
I burst into tears, the first I had shed since the accident. And, once I started crying, I couldn’t stop. The clerk looked at me uncomprehendingly. “He can’t sign,” I sobbed. “He’s in a coma.”
“Then you need the Court of Protection,” he said. I heard those words for the first time, words that represent an institution everyone should know about.
Anger and grief The Court of Protection brought me almost as much anger, grief and frustration into my life as the accident itself. Over the years that followed Michael’s accident, I had to learn to accept a new reality, to settle into a different way of life. This I did gradually, lovingly, in my own way, feeling my energy and life-force change and keeping the family together.
But parallel to this I had to come to terms with the Court of Protection, an alien, intrusive, time-consuming and costly institution, which was completely out of tune with what we were going through. For almost three years it ruled my waking moments and my many sleepless nights.
We are advised to take out this insurance and that insurance but hardly anybody tells us to take out Enduring Power of Attorney*, which enables a person to appoint another to manage their financial affairs when they may be unable to act for themselves. Yet, in a case like ours, this is the only way to avoid the Court of Protection, also known as the Public Guardianship Office.
What is the Court of Protection? There are 55,000 clients registered with the Court of Protection, all so mentally incapacitated they are considered unable to act on their own behalf with regard to their finances. Because they have not granted Power of Attorney to anyone else, their affairs are placed under the jurisdiction of the court.
The court appoints a Receiver to act on the client’s behalf in the everyday running of his or her affairs, and the receiver is answerable to the Court.
I had to apply to become Michael’s Receiver, that is, I had to apply to the court to act on his behalf in carrying out the everyday financial matters of the life we had always lived.
To become his Receiver, I had to fill in complicated forms, detailing every aspect of our lives. I also had to give notice to my children and stepchildren of my application. A Receiver can be a close family member or – where there is no suitable relative – a stranger or an organisation, such as a solicitors’ office. But in its treatment of Receivers, the court does not distinguish between a close family member or a virtual stranger.
Who is the court protecting and from whom? As the weeks and months went by it became clear that the Court of Protection’s primary role was to protect my husband from me.
I was doing all I could to look after Michael and to keep our lives in some kind of order. The Court was doing everything possible to place itself like a wedge between him and me, in order to protect itself from any accusations of wrongdoing should he ever “wake up”.
To perform this unwanted task, the unwieldy organisation stepped into my life and took away my adult independence. The tone of the letters and the restrictions on how much and in what way our money could be spent undermined my freedom and self-respect. And if I did not do everything I was told to do, I could lose the right to be the Receiver. An unknown person could step in and take over our accounts and the running of our lives.
What does the Court of Protection do? Here are just a few examples of how the Court acted under the guise of “protecting” my husband: On the day the letter arrived confirming I had been appointed as Michael’s Official Receiver another letter arrived demanding instant payment of £460; it threw me into a state of shock.
Later, I was told this bill should have arrived a month later. However, this was just the first of many fees to be paid to the Court. They include a commencement fee (£240) and an appointment fee (£315), an administration fee (ranging from £190 to £240), an account fee (£100), various transaction fees (ranging from £60 to £540) and a winding-up fee (£290).
To deal with the forms and additional accounts, I needed the help of an accountant, whose fees also had to be paid. Over the course of two and a half years, more than £3,000 was used up on the Court of Protection.
As Michael’s Receiver I now had access to our accounts. But I was dismayed by the restrictions on my spending. I could write as many cheques as necessary up to £500. But if I needed to access more than that at any one time, I had to get permission from the Court – even to pay our daughter’s university fees and accommodation.
Similarly, when I needed building work done, I had to submit two estimates and justify my choice of builder; I then had to wait several weeks for the Court to give permission and release the funds.
Distressing experience The nerve-racking experience was exacerbated by the fact that each time I phoned the Court, I spoke to a different clerk. I had to explain my distressing situation anew and then wait at least two weeks for a reply. I visited Michael daily.
The court also sent a representative to visit him. I found it humiliating. I was dealing with doctors, nurses and carerson a daily basis, yet I could not help feeling that I was the one being checked up on.
But the most distressing incident concerned a strip of land in front of our Norfolk cottage. Before the accident, the local council had approached us to build a public footpath on it. The work was carried out while Michael was in a coma. But when it came to finalising the deeds and paying the agreed compensation, my role as Receiver was apparently insufficient. I was informed that the only way forward was to make someone else a trustee to the deeds of the cottage. The costs were almost equal to Michael’s share of the compensation.
I was furious. If it weren’t for the footpath, we would not have been in Norfolk that day and Michael would not have been hit by a car and would not now be in a coma. We had gone there to discuss the council’s plans.
Overwhelmed and intimidated by the Court, furious and exhausted, I eventually asked the council to keep the compensation money until Michael either died or recovered.
The Court of Protection, no doubt, has a part to play in the life of someone with no close family or friends, who is at the mercy of strangers. But in our case it was an interfering, terrifying body using legal forms and archaic language to protect itself at huge cost to us.
After almost three years, Michael died. When I eventually received probate, I cried with grief. A few months later, when I finally closed the Receiver’s account, and my independence and self-respect returned, I cried with joy. At last I was free.
Yet all this could have been avoided – if only I’d known how”.
Take a minute to let the horror of Heather’s story sink in … Do you get it now? … ‘We are advised to take out this insurance and that insurance but hardly anybody tells us to take out Enduring Power of Attorney’ *
Well at A.R.K. Lasting Powers Wills we do tell you, and we are telling you now! Call us on 01438 746977 or email firstname.lastname@example.org to book an appointment to arrange a Lasting Power of Attorney to protect your loved ones from that dreaded ‘What if.’
All it will ‘cost’ you is £175 (plus an £82 court fee if you decide to register it for immediate use) and around 45 minutes of your time!
*Enduring Powers of Attorney were replaced by Lasting Powers on 1 st October 2007
From the moment a baby is conceived our natural instinct as a parent is to protect that tiny little foetus – and that protective feeling lasts forever.
Think of all the ways we protect our children; the loving, caring, teaching and nurturing we do from the moment they are born until they officially become adults at 18 (and far beyond that)! The feeling of wanting to look after our children never fades. They may become independent, responsible adults who no longer need our day to day support and care, but we would still do anything for them!
Some of the things we do to protect our children are very grown up things – most of us make sure we have insurance in place so that if something was to happen to us while our children are young, there would be money there to pay for their upbringing. Where we can, we save money for their future; to help with buying their first car, their university fees, their wedding or their first home. If we can afford it, we might choose to pay for private healthcare insurance for them. We do our absolute best to make sure that whatever happens, our children would be ok.
There are other very grown up things that we should all do to help protect our children:
We should make a Will (appointing guardians to look after them if we can’t while they are young) and to make sure they inherit what we want them to inherit.
We should seek financial advice as we get older to try to avoid our children’s inheritance being lost to pay Inheritance Tax after we are gone.
We should make Lasting Powers of Attorney to make sure that if something happened to us which meant that we weren’t well enough to look after our own money, they would be able to step in and help us easily without a long expensive court process.
We should consider making a Funeral Plan as we get a bit older (perhaps 50+) – this is sensible for 3 reasons:
1. To save your family money! The average funeral today costs around £4,000 but funeral costs are increasing rapidly. In the last decade they have risen by 70%, so that average price funeral could cost around £30,000 in 30 years if costs continue to rise at the same rate. If you buy a Funeral Plan today (plans range from £2,275 to £3,900) you will potentially save your family many thousands of pounds.
2. So that your family will be in no doubt about what you want at your funeral – they will have less difficult decisions to make when they are trying to cope with the grief of losing you.
3. So that the money to pay for your funeral will be immediately available. One call to the Funeral Plan company and everything will be taken care of – the Funeral Director will be contacted, and everything will be dealt with in accordance with your wishes. The money will be paid direct to the Funeral Director so there will be no need for your family to find the money to pay for everything.
So basically; by making a Funeral Plan you would be protecting your children’s inheritance (saving money so that it ultimately goes to your children, rather than to a Funeral Director to pay for an expensive funeral). You would be protecting them from the stress and upset of second guessing what you would have wanted at your funeral and finally you would protect them from the hassle of having to work out how to pay for your funeral while they are trying to come to terms with the fact that they have lost you.
A.R.K. Lasting Powers & Wills is a family business based in Stevenage; various members of the family are involved in the business in one way or another – and all those people are Stevenage people with extended family and many friends in the town. We have a passion for helping other families protect each other – be that other Stevenage families or families in all our neighbouring towns and villages.
We do this by meeting our clients (usually in their own homes so they feel as comfortable as possible discussing sensitive matters), listening carefully to people’s concerns, offering advice and recording people’s wishes. We offer jargon-free explanations and information and we give our clients time to decide what they want. What we DON’T do is pressurise anyone to do anything they are not comfortable with.
It was on a family holiday recently, that we discussed our aim to help other families to be organised, prepared for the worst – hoping that some of those horrible situations won’t occur, but wanting people to be prepared in case they do. We realised that we could link up with other professionals who provide the services we aren’t able to offer ourselves. So, if you are an A.R.K. client and during our conversation about your Will, we discover that you need some advice about your pensions, or life cover, or investments or health insurance we will be able to recommend people we trust to assist you with those matters. So that the whole spectrum of services needed to protect your family can be covered. Again, there is absolutely no pressure for our clients to use the companies we recommend, but we are pleased to be able to provide options and information to enable them to make informed choices. We also have links with the amazing charity Home Start (Stevenage) who offer a range of support to families who are struggling with the demands and challenges of being a parent. More information about their services can be found at: www. home-startherts.org.uk
The point of this blog was to explore all the ways that we may protect members of our families. There are probably many other ways that we haven’t thought of, but hopefully we have made you stop and think; to take stock and consider actions you could take that might make everything easier for your loved ones, to protect them as best you can – no matter what life throws at you and your family!
Some of the A.R.K. team went to Safe Hands head office a couple of weeks ago for some refresher training. We have summarised some interesting facts about why a Safe Hands pre-paid Funeral Plan is a good idea!
The average UK simple funeral and cremation currently costs between £3,500 to £4,500 depending on where you live. This can often be a lot more. Our Pre-Paid plans start at £2,275 and go up to £3,900.
In the last 10 years the cost of a simple funeral has increased by 70%
Based on the current increases, by 2029 an average funeral will cost £10,000 and if the current trend continues in 30 years the cost of a simple funeral could exceed £30,000!
Funeral costs vary in different parts of the country, but a plan costs the same wherever you live. For those of us in the expensive outer London area this is a major plus point.
You can specify exactly what you would like to happen at your funeral and your family will not have to second-guess your wishes.
You can specify a particular Funeral Director if you wish, if you don’t do this a local Funeral Director will be appointed by Safe Hands when the time comes.
Funerals of all different faiths are catered for.
Funeral Directors will often persuade families to upgrade by using terms such as ‘something a bit nicer for your loved one’ so buying a plan specifying your wishes can stop your family being upsold to at the toughest of times.
THE ASPECT MOST PEOPLE ARE CONCERNED ABOUT BEFORE BUYING A PLAN:
How safe will the money be? How do I know my funeral will definitely be paid for?
Safe Hands invests the money for plans in a completely independent Trust Fund. Therefore, in the unlikely event something happens to Safe Hands the customer’s money is completely safe.
Pitman’s Trustees Ltd an industry regulated Trust Fund Management Company administers the Trust Fund. The Trust Fund monies are invested by UBS in low and medium risk investments and spread over a large range of investments; which keeps the risk of investments safe.
The fund is audited annually (most recently in October 2017) and even if everyone who has a plan died today, there would be enough money to pay for all those funerals plus there would be a £9million excess.
The Trust has Public Indemnity cover and is under the umbrella of the Financial Services Agency, although it’s not subject to the compensation rules as it is not a bank or building society.
Other information regarding Funeral Plans:
You can pay by instalments, which are interest free for up to 2 years. For periods of more than 2 years a 4% annual handling charge is made.
You can purchase a funeral plan with just a £250 deposit, and then pay low monthly instalments for periods up to 10 years. A small price to pay for the total peace of mind it will bring for you and your family.
There are several different levels of plan that can be tailored to meet you needs. These will be fully explained to you by one of our friendly consultants; prices start from just £2,275.
There is a 21-day cancellation policy during which you can get a full refund if you change your mind.
There is absolutely no pressure to buy! Our consultants will visit you at home to discuss the plans available in as much or as little detail as you wish.
We have no involvement with any call centres or comparison websites.
Pre-Paid Funeral Plans are greatly increasing in popularity and for example in The Netherlands over 70% of the population now have a Pre-Paid Funeral Plan.
Believe it or not, you are actually allowed to make some gifts without your heirs having to pay any tax at all. Understanding where these boundaries lie however, is generally an area many of us can find confusing. With this in mind, I’ve pulled together a breakdown that whilst comprehensive should be easily digestible!
The law –
You are allowed to make tax free gifts as follows:
Gifts to ‘exempt beneficiaries’:
You can give as much money as you like to certain people and organisations without paying Inheritance Tax (this applies whether you give money whilst living or after you death, via your will). Exempt beneficiaries include:
Your husband, wife or civil partner, provided they live permanently in the UK
Charities registered in the UK – to check which charities qualify, visit the HMRC website
Some national organisations like universities, museums and the National Trust
NOTE that gifts to unmarried partners or unregistered civil partners are not exempt from Inheritance Tax.
Your Annual Exemption:
You are allowed to give away a total of £3,000 each year, without any tax implications after your death. Bear in mind that this is the total annual amount that you can give away, NOT a total amount you can give to each beneficiary, each year.
It is also worth noting that your Annual Exemption can be carried forward for one year if it has not been used. In other words, if you did not make any gifts of money during last year, you can give away a total of £6,000 this year. Equally, if you gave away £1,500 last year, you’ll be able to give away a total of £4,500 this year.
The Annual Exemption cannot be carried forward by more than one year.
Giving small cash gifts:
In addition to the exemptions above, you can give away small gifts – not more than £250 – to as many people as you like in one tax year. However, some points to remember include:
You can’t make a gift of more than £250, and claim exemption on the first £250 (larger gifts are treated differently)
You can’t combine the small gifts exemption with another exemption when giving money to one person. In other words, you can’t give one person £3,250 and claim exemption based on a combination of the small gifts and ‘Annual’ exemption.
Provided that you give or promise to give a cash gift on, or shortly before, the ceremony you can make quite large cash gifts as wedding or civil partnership presents, without being liable for Inheritance Tax. The limits on such gifts depend on your relationship with the recipient:
If you are a parent you can give up to £5,000 tax free
Grandparents can give up to £2,500
Anyone else can give up to £1,000
Remember, however, that if the wedding or civil partnership is called off and you still give the gift, it will NOT be exempt from Inheritance Tax.
Regular gifts or payments:
Any gifts that are part of your normal expenditure are exempt – provided they are made from your net, ie. after tax income (not your savings); and that you have enough money left over to maintain your lifestyle. These exempt payments include:
Maintenance for your husband, wife, civil partner
Maintenance for your ex-husband, ex-wife or former civil partner
Maintenance for relatives who depend on you
Maintenance for your children, adopted children or step-children, as long as they are under 18 or in full-time education
Monthly or regular payments to anyone
Regular gifts for Christmas, birthdays or wedding/civil partnership anniversaries
Premiums on life insurance policies
What if I want to make other/larger gifts? – The ‘Seven Year’ rule
Any gifts you make that do not fall under the scope of those mentioned above will be treated as your asset in decreasing percentages for some time after you have made that gift.
Gifts made 3 to 7 years before your death are taxed on a sliding scale known as ‘taper relief’.
We’d all rather our loved ones benefitted from the full inheritance we want to leave them, let’s not line the taxman’s pockets with more than we have to. Contact A.R.K on 01438 746977 or email email@example.com for more information.
There are few things in life that are likely to be more traumatic than dealing with the death of a loved one. It is, however, an unfortunate and painful reality that we will probably all have to face at some point.
Thankfully there are safeguards we can put in place to ensure that when faced with these situations, we can allow ourselves to deal with the emotional turmoil such events bring, knowing that the practicalities of dealing with finance, insurance companies and assets have all been taken care of in advance.
There are many considerations when it comes to Wills and Probate, and the process of the tying up of a loved ones’ affairs. You may be aware of some of the more well-known elements; such as the Will itself and what it means to be a Beneficiary. However, for many, knowing what it means to be ‘Intestate’ and understanding the legal requirements of the ‘Trust Minutes’ is an unknown entity. With this in mind, I’ve compiled a list of terms and their definitions, to remove the potential cloak of confusion surrounding an area we all need to have a clearer understanding of.
The legal document allowing you to leave your ‘estate’ the way you would like to leave it. A Will must be in writing, it must be signed and dated in the presence of two witnesses, who must then sign to confirm they are witnessing it.
The total value of your assets when you die, after deducting any debts and funeral expenses.
If you die ‘intestate’ you die without leaving a Will. Your estate will then be distributed to your family in accordance with the laws of intestacy. Only if you have no family at all will your estate pass to the government.
The person or people appointed to look after your estate. Responsibilities include:
Arranging the funeral
Notifying any relevant companies/organisations regarding death
Calculating the value of an estate to establish whether Inheritance Tax is due to be paid.
Establishing whether a ‘Grant of Probate’ is needed and if so applying to the court for this document.
Calling in assets and paying any debts
Distributing the estate in accordance with a Will or the laws of intestacy.
Running any Trusts that are created (if separate Trustees are not appointed)
Power of Attorney
The document you will need to sign, in front of a witness, to give a solicitor or other professional authority to act as executors on your behalf.
A person appointed to run any Trusts that are created following a death. Often this is the same person/people who are appointed as executors, but sometimes separate Trustees are appointed.
The value of assets placed in Trust for children or others following a death.
These are required by law. All Trustees are obliged to meet at least annually and to minute that meeting to ensure that the Trust is being run correctly.
The person or people appointed to look after any child under the age of 18 when parents are not able to look after the child themselves.
Someone who benefits from a Will i.e. inherits something in a Will.
The ‘gift’ you are left in a Will.
This is often the general term used to describe the process of administering an estate after someone has died.
Grant of Probate/Representation
This is the document that is often needed to call in assets (obtain funds from banks etc that are holding money belonging to the deceased’s estate), or to sell property. An application to court has to be made and a fee is payable. Individuals applying will have to attend court or a solicitor’s office personally to swear oath, whereas professional executors do not have to do this.
Letters of Administration
The Scottish equivalent of a Grant of Probate.
Any item of value owned by the deceased.
Any debts the deceased had at the time of their death, plus costs which occur whilst the estate is being finalised e.g. funeral costs/professional fees and disbursements.
This is the net estate available to be distributed to beneficiaries after all liabilities have been paid and specific gifts have been made.
Deed of Variation
A legal document which allows a beneficiary to vary the terms of someone’s Will up to two years after they have died. This is useful where a beneficiary does not want to inherit something as it may have an impact on Inheritance Tax that would be due on their death. They can vary a Will so that their inheritance will pass straight to their child/children.
Right to occupy/Life interest
If a Will specifies that you have been given a ‘right to occupy’ or a ‘Life Interest’ in a property it means that you will be allowed to live in the property for a defined period, but you will not actually own the share of the property that was owned by the deceased. This share will be held in Trust.
Inheritance Tax (IHT)
The tax that can be payable on death (and on some gifts made prior to this). There is an annual exemption each year (currently £325,000) and if the estate is valued above this level Inheritance Tax will be payable at 40% on the excess. In the case of a married couple the allowance which is unused by the first person to die can be transferred to the surviving spouse, meaning that, based on current rates, up to £650,000 can be treated as being exempt from Inheritance Tax.
Residence Nil Rate Band
A new Inheritance Tax ‘allowance’ that was introduced in April 2017. If you
have a property that you are ultimately leaving to children you can currently
leave an additional £100,000 without IHT being due. For a couple this can be
transferred to a spouse, meaning that the couples’ allowance is increased
from £650,000 to £850,000 in the 2017-18 tax year. By 6th April 2020 a
couple leaving a property to children or step-children will be able to leave up
to £1 million without IHT being due on their combined estates.
Distribution (final or interim)
This the act of making a payment to a beneficiary, and also the term used
to describe the payment. A distribution can be ‘interim’ if funds are paid to a
beneficiary prior to the estate being wound up, or it can be ‘final’ if all
calculations have been completed and the estate is being finalised.
Many of us spend years debating the drafting of our Wills and never actually get around to writing them. This can be because people are uncomfortable having discussions with their loved ones on the seemingly cold and callous topic of how the estate will be split, who will be entitled to what, how and when. At A.R.K. we understand how difficult this process can be, and are here to help you every step of the way with expert, jargon-free advice; ensuring you and your family are protected from the worst.
If you feel the time is right for you to put pen to paper, and ensure that your loved ones aren’t left with anything other than peace of mind for the future, call us today on 01438 746977 or email firstname.lastname@example.org.
At A.R.K. Lasting Powers & Wills, we meet people from all over Stevenage and north Herts. As you’d expect, we talk about their circumstances when working with them to write their Wills.
Often, the subject of Lasting Power of Attorney is discussed, (in some situations, it’s more important than a Will). There are many misconceptions about Lasting Powers of Attorney, (LPAs). These lead people to think that they are ‘covered’ should they or their loved ones become ill and lose mental capacity when actually… they’re not. Sadly, many people only realise the facts about the need for Lasting Powers of Attorney when it’s too late.
So – this is our opportunity to set the record straight!
3 Misconceptions About Needing An LPA
“I don’t think I need a Lasting Power of Attorney – because…”
…I’m too youngto think about doing that – our answer is that you never know when an accident or stroke could leave you too ill to look after your own finances. LPAs are not just a good idea when you are older and worried that you may end up suffering from Alzheimer’s or Dementia. There are many other conditions/events that can mean that mental capacity is lost. Make life easier for your family, should something unexpected happen, by making an LPA. You can appoint people you trust to help you if you suddenly became ill.
…I’m married and all my accounts are joint with my spouse – our answer is that this would make no difference at all! When somebody loses mental capacity, the medical professionals inform the Court of Protection and they immediately freeze ALL accounts belonging to the person who is ill. This includes joint accounts, which means that the person who is well won’t even be able to access their own money. It takes a special application (and the payment of a fee) before the Court of Protection will unfreeze joint accounts. All this trauma could be avoided if an LPA is in place when someone becomes ill. Also, anything that needs to happen with property that is jointly owned needs the signature of both owners. This could cause a lot of problems, but with an LPA in place there would be no problem at all as an attorney can sign as if they were the person who is ill.
…My son/daughter has access to all my accounts, they are even a cardholder – our answer to this one is that whilst this can work on an informal basis when you are well, the arrangement would not be allowed to continue if mental capacity were lost. The Court of Protection would be informed that you had lost mental capacity and all your accounts would be frozen. No-one would have access to your money until the court decides who is the right person to take over the running of your finances. So, money needed for your care or to pay your bills would be unavailable to your family until the court process is complete. This can take many months, and the cost of the application would be a lot more than the cost of making an LPA while you are well!
So, these are common ‘reasons’ we hear regularly about why it isn’t necessary for someone to make an LPA. Anyone who believes it isn’t necessary is being short sighted – you never know what’s around the corner. You might not want to pay the fee for making an LPA now in the hope that nothing happens, or that you will have warning that you are becoming ill and that you can do it then. But what if there is no warning? Your family will be really upset because you have had a serious accident, or a bad stroke. Coupled with that they will have the extremely difficult job of applying to court so that they can access your money to continue paying bills, or to buy the things you need for your care, or even to actually pay for your care.
Equally, if it is Alzheimer’s or Dementia that means mental capacity is lost, unless you act quickly when you become ill it could soon become too late to make an LPA.
What happens if I don’t set up an LPA?
Without an LPA nobody is allowed to help you without permission from the Court of Protection (CoP). They must apply to the court to be appointed as a ‘Deputy’ so they can manage your affairs.
A Deputy can regain control (with luck) inside six months. And please be aware that it is extremely unlikely that a Common Law Partner will be appointed as a Deputy (however, you CAN appoint a Common Law Partner to be an attorney on your LPA).
It is also important to note that the CoP charges a fee for appointing a Deputy, which is far more than the cost of making an LPA at the outset. The court also charges for overseeing the actions of the Deputy and will expect regular accounts and updates. Ultimately, the CoP is responsible for ensuring that the Deputy is acting in your best interests. With an LPA, the attorneys are allowed to get on with the role without being monitored as you said you would trust them to do that.
All of this hassle and upset can be avoided for your family if you make an LPA while you are well, to act almost as an insurance policy.
Why use A.R.K. Lasting Powers & Wills to arrange an LPA for you?
We will make the process simple and stress-free. You will only need to spend about 30 – 45 minutes giving us the details of the attorneys you’d like to appoint. We’ll provide one-to-one advice and support throughout the process; we’ll collect signatures from any relevant person who is present at the initial appointment, and then arrange for attorneys who are not present to sign where needed (this can often be done by post). And we’re fully qualified and authorised to sign the LPA to confirm that the person making it has the mental capacity to do so.
Our fees are vastly less than a solicitor may charge, but you will receive exactly the same document once the process is completed. The fee for the first LPA anyone makes with us is £150*
There is another type of LPA which covers health and welfare matters and gives people you trust the right to make decisions regarding your daily care if you’re too ill to do so, and allows you to specify your feelings regarding life sustaining treatment. We can give you information regarding this type of LPA as well, and if you think that it makes sense for you to have both documents the fee payable to A.R.K. will only be £250*
What do I do next?
Call A.R.K. on 01438 746977 or 07926 339934 or contact us to discuss making an LPA, or to arrange a daytime or evening appointment. We generally prefer to see people in the comfort of their own homes, but daytime office appointments can be arranged if you would prefer.
* If you decide to register your LPA immediately, the Office of the Public Guardian charges a fee of up to £82 for each LPA you are registering.