As Winter approaches and the New Year will soon be upon us, now is the perfect time to review your Will and estate plan to ensure that your affairs are in order for 2025. Effective Will and estate planning can protect your assets, minimise tax liabilities, and ensure that your wishes are followed after your death. Taking action before the New Year can also help you maximise certain tax allowances and ensure peace of mind.
Here’s why it’s important and what you need to consider:
Review and update your Will – Life changes such as marriage, divorce, the birth of children, or acquiring significant assets often mean that your Will may need updating. Ensuring that it accurately reflects your current wishes is really important. Without a valid Will in place, your estate may be distributed according to UK intestacy laws, which could mean that your assets do not go to the people or causes you care about most.
Inheritance tax (IHT) planning – IHT in the UK can significantly reduce the value of the estate passed on to your beneficiaries. Currently, estates over £325,000 are subject to a 40% tax, but there are ways to reduce this. Taking advantage of tax reliefs, such as the annual gift allowance of £3,000 per year or using trusts, can reduce the taxable value of your estate. Additionally, the Residence Nil Rate Band (RNRB) offers further relief.
Lasting Power of Attorney (LPA) – While estate planning often focuses on what happens after death, it’s equally important to plan for what happens if you become unable to manage your affairs. An LPA allows you to appoint someone to make decisions on your behalf if you lose capacity due to illness or injury. There are two types of LPAs: one for property and financial affairs, and another for health and welfare.
Consider gifting before the New Year – Gifting assets during your lifetime is a useful strategy for reducing the taxable value of your estate. You can give away up to £3,000 each tax year under the annual gift exemption, which is not subject to IHT. If you haven’t yet used your gift allowance for the current tax year, now is the time to make gifts before the tax year resets.
Future planning is important to ensure that your wishes are clearly understood and noted. By seeking professional advice from PGM Solicitors can provide peace of mind for you and your loved ones. Always ensure that your Will and estate plan are comprehensive and legally sound, contact our specialist team and we will guide you through the process.
Contact us
For further advice contact our specialist team on 01792 468684 or email enquiries@pgmsolicitors.co.uk.
