Last updated on August 13th, 2019 at 12:31 pm
The advice puts solicitors in a much better position than other advisers, who are not regulated by the Law Society, to ensure that clients are fully aware of the implications of making gifts.
Some of the advice in the practice note suggests that a solicitor should:
- Receive detailed instructions of the gift i.e., why the gift is being made, what is being gifted and to whom.
- Ensure that there are not other ways of achieving the client’s wishes, e.g. making a will or a power of attorney.
- Ensure that the client is making the gift freely and hasn’t been unduly influenced by others.
- Ensure that another solicitor or adviser hasn’t already refused to help the client make the gifts.
- Ensure that the client has the capacity and fully understands the benefits and risks of making the gift.
- Establish that their client actually owns the assets that they are gifting.
- Ensure that the client fully understands the implications of the gift and how it might affect others who might expect to eventually inherit, or that it isn’t part of a family business that might not function without it, for example.
- Check whether the client’s will needs amending as a result of the gift.
- Confirm with the donor of the gift any instructions received from a third party if the client is not the actual donor.
- Consider tax implications of the gift.
There are many benefits in making gifts in your lifetime, including a reduction in inheritance tax, being relieved of the burden of upkeep on property, for example, and making life better for the people you are gifting to – such as with birthday/wedding presents, but there are risks too if you are trying to avoid paying care fees. They can also be expensive and may be unsuitable for your needs. You must, therefore, make sure that you have the best possible advice when making the gift and our estates experts, whose aim is to ensure that you end up with what is best for you personally, are in the best place to give you that advice.
Contact us now to make an appointment for a free of charge meeting in which we can discuss your needs and find the best solution for you.
Read more about lifetime gifts and inheritance tax on our web pages.