Estate Preservation

Inheritance Tax Planning Wills

As property values in Scotland soar to unprecedented levels, many of us will fall into the inheritance tax bracket - very often without realising it.

Avoiding inheritance tax with a 'discretionary will trust' is one posible solution - it is perfectly legal and leaves you in control of your assets and income while you are alive. Just as important is the fact that it leaves you or your spouse in control of assets and income when one of you dies.

So if you don't want to leave up to 40% of the value of your house and savings to the HMRC, this should be the cornerstone of your personal financial strategy. For most married couples, this tax mitigation strategy is usually the most cost effective, and it can even be used for avoiding inheritance tax on the family home.

If you want to ensure that your hard-earned cash goes where you want it to, and not to the taxman, contact Warde Graham for advice. Proper planning can greatly reduce, or even wipe out completely any such tax liability.

Care Cost Protection

One-in-three women and one-in-five men are likely to need long term care at some stage of their lives - most likely old age. The average cost of a stay in a residential home can be as much as £20,000 a year and much of the cost must be funded from your own pocket.

Many people who grew up believing the state would provide for them in old age are likely to be disappointed. Local authorities will only fund the cost of accommodation for those judged to have assets worth less than £20,000. If your assets are worth between £12,250 and £20,000 you will be expected to contribute, and if your assets are worth more than £20,000 you will have to pay the full cost.

The definition of assets includes both your savings and income. It may also include your home, unless your partner lives in the property, or a relative who is either disabled or aged over sixty. However, only your assets are counted - or your share of any jointly-held assets - not those of your spouse.

The value of your home is ignored for the first twelve weeks of any stay in a home, but each year some 40,000 family homes are sold to cover the cost of long-term care. A local authority cannot force you to sell your house but it may be able to put a 'charge' on the property, which allows it to reclaim any care costs when your home is finally sold. It is illegal to deliberately transfer your home to relatives or to trusts if the primary motivation in doing so is to avoid paying long term care fees.

However, if home-owning couples act early enough to prepare a special type of property protection trust, they can quite legitimately leave their share of the property in a trust whilst ensuring the surviving partner has the right to remain living in the house. In this way, part of the home is kept out of the local authorities' reach and is therefore protected for the benefit of the family.

Wills*

Having a will professionally prepared is one of the most important tasks we ever have to do to protect our families. And yet, so many of us put it off - "until tomorrow". Sadly, tomorrow often never arrives and loved ones are left to pick up the pieces, and at a time when they also have to cope with feelings of loss, shock and grief.

Don't put off making a will any longer. Since we come to see you in the comfort, privacy and convenience of your own home, it couldn't be easier.

Even if you already have a will, you must check whether it is the right one for you. Circumstances change and it is essential that you keep your will updated in line with your needs. If you're not sure of your situation, we can carry out a free, no obligation review of your existing will, on the basis that it's better to be safe than sorry.

*Will writing is not regulated by the Financial Services Authority

Power of Attorney

In the unfortunate event that you become incapable of handling your own affairs, perhaps due to a stroke, dementia or Alzheimer’s, who would you trust to look after things on your behalf? If your family hasn't been granted a power of attorney, they may have to go to court to ask for permission to act for you.

You can prevent the possibility of this problem arising simply by putting a power of attorney in place, and it can be done very easily. We can help you to set up a 'lasting power of attorney', so that you can appoint people you know and trust to manage your affairs, even if you become mentally incapable of managing them yourself.

Without a lasting power of attorney in place, joint assets may be frozen whilst your family applies to the court of protection for receivership, which can be a very upsetting, lengthy and costly process.