Planning for the future can be a daunting task and, whether you’re making a Will, organising nursing home care, or calculating Inheritance Tax, there are some important need-to-knows. Thankfully, law firm Howells has provided some answers to those burning financial questions that can often leave you scratching your head in bemusement.
1) How much do I have to leave before I’m required to pay Inheritance Tax?
The Nil Rate Band is currently £325,000 for each individual. It is unlikely that this will be increased before 2015. Above this figure tax is payable at 40% with certain exceptions.
2) If my spouse or civil partner did not use their entire Nil Rate Band, can the balance be carried over to my estate?
For deaths after 9th October 2007, all of the unused proportion of a deceased spouse’s / civil partner’s Nil Rate Band can be transferred to the individual's surviving spouse / civil partner for use on their death.
3) Should I still make a Will even if my estate does not exceed the Nil Rate Band?
You should make a Will to ensure that your wishes are honoured and your belongings will be distributed as you want when you die. Even if your estate is less than the Nil Rate Band you could still find that not all your estate passes to your spouse / civil partner and could even pass to people you do not know or like. A Will can also help protect your estate in the event of a second marriage or a survivor requiring some form of residential or nursing care.
4) Do I need a solicitor to make a Will?
Although it is possible to make a homemade Will or seek advice form unqualified and unregulated Will Writers, it is highly advisable to take professional advice, particularly to ensure that the formalities are observed. Particular difficulties can be experienced where there are children, particularly minor children, children from previous marriages, or mental health issues where trusts might be required. Solicitors are trained and experienced in giving advice and guidance on such matters, as well as implementing solutions to difficulties which arise.
5) Can I do anything in my lifetime to take better legal care of myself?
Wills do not take affect until death, but it may be advisable to consider making a Lasting Power of Attorney so that someone you trust can look after your financial affairs in a way which you would wish in the event of you becoming incapable of managing your affairs. This can also be extended to other areas of your life, such as medical treatment.
6) If I require care do I have to pay?
It is important that you or your family are aware of your rights when someone is admitted to a care home or requires some form of care as you may be entitled to financial assistance If someone needs 24-hour nursing care because their health care needs are, amongst other things, complex or unpredictable, NHS care is free at the point of delivery, whether you’re in hospital, at home, or in some form of nursing care. If that is the case the local health board should be responsible for costs and not the individual concerned. It is even possible to raise a challenge against the NHS after someone has died if it becomes clear that they were paying for their care when they should not have been.
Where nursing care is not an issue you should still make sure that you are not paying too much and that you are receiving all the benefits to which you may be entitled. Where you have less than £22,500 in capital then the council will assist in the payment of your charges. (2011/2012). This figure is “protected capital” and cannot be used towards your fees.
7) How can I ensure preservation of assets if I am already paying nursing home fees or will likely need to in the future?
Although in this scenario it is often impossible to deprive yourself of assets, advanced planning can sometimes help. However, it is important to remember whose money it is, and it may be unwise to transfer ownership of homes or cash as it may limit your options when choosing a suitable care home.
8) What can I do about it if I am concerned about these matters?
Call Claire Davis or her team at Howells Solicitors on 01633 227960.
Howells Solicitors is one of the leading law practices in South Wales, providing a full range of legal services to both corporate and individual clients.