High profile cases highlight national wills issue
Only Fools and Horses star, Roger Lloyd-Pack, died intestate leaving an estate worth £1.4 million, highlighting the problems that can arise from not creating a will.
The issue of not creating a valid will is a common occurrence within the wills and probate industry, and one that has previously been reported by Today’s Wills and Probate. The recent high profile example of Roger Lloyd-Pack passing away intestate has highlighted an already prominent issue for the population. Indeed, current statistics show that two thirds of those in the UK die intestate.
Although intestacy rules exist in order to protect individuals who die without a will, they can only cover a limited number of situations. A consequence of this is that without a will, a share of the estate could then be passed on to the individual’s children, potentially triggering much greater inheritance tax (IHT) repercussions.
In the case of Lloyd-Pack, the impact of not creating a will has meant that the distribution of his estate has been governed by the stricter intestacy rules. Consequently, his estate will be subject to more tax, coupled with the fact that he was unable to have a direct say on how his possessions would allocated subsequent to his death.
Following the rules of intestacy, Lloyd-Pack’s estate will be shared between his widow and four children. However, the family will still face larger IHT that could have been avoided through careful wills planning. Currently, if an estate is over the £325,000 threshold then 40% IHT will be due. Since after legal and funeral costs, it is likely that his children will be entitled to an amount over this figure, a larger tax bill is probable.
Andrew Kidd of Clintons law firm in London has shared his views on this particular case. His evaluation on the limited facts available is that a large IHT bill will be likely. The probate specialist has also stated that in order to calculate the overall tax owed, Lloyd-Pack’s belongings would have to be valued in order to establish the whole estate’s worth.
High profile cases such as this are not uncommon. Rik Mayall is another example of a British actor who has passed away recently without possessing a valid will, meaning that his preference could not be established over the next steps of his high-value estate.
The low percentage of the population currently possessing a will arguably demonstrates a need for improved financial and tax education in order to increase awareness surrounding the importance of the legal document. Many solicitor firms already market wills to their clients, however some have argued that more should be done on a national level to ensure people retain as much control over their estate as possible after they pass away.
In your experience, could more be done to encourage clients to create wills? Is more awareness needed for the general public regarding planning for wills and IHT?
Let us know your thoughts in the comment section below.