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Free will review

With the advent of the residence nil rate band (RNRB) in April this year, Graysons is offering to review your will for free – to make sure that it is tax efficient and meets your requirements.

Last updated on June 20th, 2018 at 12:23 pm

Residence nil rate band

The RNRB means that, where a property is involved, you can leave an extra £100,000 to your children (including step-children), or other direct descendants (grandchildren), inheritance tax-free, on top of your existing nil rate band (NRB) of £325,000.  The RNRB will increase by £25,000 a year until 2020 when it will reach £175,000; meaning you will be able to leave half a million pounds to your family.  A good time for a free will review? We think so.

If you are married, and your spouse dies, you could inherit his/her nil rate band, meaning you will be able to leave up to £1 million to your children and/or decedents tax-free, as, since 2008 the unused part of the NRB passes to the surviving spouse.

Nil rate band discretionary trusts

However, if you have made use of a nil rate band discretionary trust (NRBDT) within your will, having not changed your will and you die, the RNRB will be lost, so your children, grandchildren etc. will not benefit from it.  This is because, up until 2008, when the surviving spouse inherited his/her spouse’s NRB (currently £325,000), many people set up nil rate band discretionary trusts.  This meant that the amount of money up to the NRB was paid into a trust upon death, protecting it from inheritance tax.

Of course, you may wish to maintain your NRBDT, if you have one.  For example, if you want to protect your estate from a divorce settlement, or from care fees, but more than likely you will want to alter your will so that you can take advantage of the residence nil rate band when it comes into force and thus reduce inheritance tax.

Thankfully there is a different type of will trust known as an ‘immediate post-death interest’ (IPDI), often referred to as a ‘life interest trust’, which can offer asset protection from things such as nursing home fees, and still qualify for the additional RNRB.

Contact us for a free will review

Contact us now for a free will review.  We can advise on the best position for your own circumstances and amend your will or write a new one.

You can find out more about making your will on our web pages.

You have landed on this page as Watson Esam has merged with Graysons

You can read more about the merger here. Graysons will be pleased to help with your enquiry. Please visit our web pages or contact us directly on 0114 358 9009

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