Millions of Brits Have No Will

By

Almost two-thirds of the British population do not have a will – and even expats do not understand the complex inheritance laws that may mean their estates are still subject to UK rules even if they live overseas.

Unlike tax residence, inheritance tax (IHT) depends on domicile – which put simply means where income tax is paid depends on where you live, but inheritance tax often depends on where you were born.

The law is more complicated than that – and expats should take advice on how their tax status affects their investments and pensions.

Many expats have to write two wills – one for Britain and the other for the country where they live.

Even though many expat investments, like QROPS and QNUPS pensions, are exempt from UK IHT, they may be subject to tax in the country where they live.

Providing for loved ones

Around 10% of adults believe their estate will pass automatically on their death to their partner or loved ones. This is incorrect and the estate of someone dying without a will is subject to intestacy laws that divide the proceeds among relatives in set proportions, according to a survey by IFA group unbiased.com.

“Too many people are simply unaware of the control that having a will gives you and its importance in ensuring your loved ones receive what you intended them to,” said CEO Karen Barrett

“People should be thinking early on about how best to protect their belongings and assets to ensure they go to those they intended them for when they pass away.

“People spend their lives providing for their loved ones, yet lack of action in planning their affairs for after they have gone could lead to a hefty inheritance tax bill, not to mention additional stress for the family and potential delay in distributing assets.”

Pets, children and charities benefit

The findings showed 42% of UK adults have not thought about the impact of IHT on the estate they wish to leave behind when they pass away.

When people start thinking about their estate, children and grandchildren are the top beneficiaries, but charities and pets benefit as well.

With tuition fees rising, 13% said they would like to fund their child or grandchild through university, and 22% would like to boost savings for their children or grandchildren.

Almost a third of those without a will (30%) stated that they plan to make one when they ‘get older’, while 11% said it never occurred to them and 21% felt that they didn’t have anything of value to leave behind.

Leave a Comment