Private Client

The period after a loved one has died is very difficult and can be exacerbated by not knowing the requirements for handling the estate.

After navigating the immediate steps that must be taken after the death of a loved one, it is time to consider how the estate will be administered. Here, Helen Jago, a Director with Palmers who specialises in Wills and estate administration, explains how an estate can be administered both in situations where a Will is in place and when someone has died intestate (without leaving a Will):

To move forward with estate administration, it is necessary to locate the Will (if there is one) to divide the estate in line with the deceased’s wishes.

The Will usually names an Executor to handle the duty of administrating the estate. This could be a sole Executor, or multiple people may have been named to carry out the duties jointly.

At this stage, it is important to check the validity of the Will which includes ensuring that the Will is the latest version and is in writing. The Will should be signed and dated by the person who made it, as well as being witnessed by at least two adults (these witnesses should not be beneficiaries).

If there is not a Will in place, the estate can be divided by an individual who takes on the role of Administrator, who is often next of kin.

Ahead of obtaining the relevant approval to administer the estate, it is necessary to value the estate, which includes valuing all assets (including property, savings, and possessions), along with any debts that need to be paid.

Gifts given within seven years of the individual’s death should also be accounted for in the valuation process.

If an Administrator has been selected, they will need to apply for a Grant of Letters of Administration to continue with the process of administering the estate.

Executors must apply for a Grant of Probate if the value of the estate exceeds £5,000.

For help and advice on administering an estate, please get in touch with our Wills and Estate Administration team.

More and more people are being drawn into paying Inheritance Tax (IHT), as the price of property soars.

Here, Tim Steele, a Director with Palmers, who specialises in older client matters and putting in place plans to minimise Inheritance Tax, explains when the tax is payable and what you can do reduce your IHT burden:

What is IHT?

Inheritance Tax is a tax on the estate (the property, money and possessions) of someone who has died.

How much do I have to pay?

IHT is levied at 40 per cent on everything in an individual’s estate at their death above the Nil Rate Band of £325,000.

However, many taxpayers also benefit from the Residence Nil Rate Band, which adds an additional allowance of £175,000 for their main property if it is passed to direct descendants.

If you are married or in a civil partnership these allowances can be passed to a spouse or partner once the other person dies.

Are there any ways to save on IHT?

Here are some of the ways that you can cut your IHT bill with careful planning:

Gifting

There’s usually no IHT to pay on small gifts you make out of your normal income, such as Christmas or birthday presents, which are commonly referred to as ‘exempted gifts’.

There is also no IHT to pay on gifts between spouses or civil partners and you can transfer as you like during your lifetime, as long as they live in the UK permanently.

You can give away £3,000 worth of gifts each tax year without them being added to the value of your estate thanks to the ‘annual exemption’. If you have any unused annual exemption, you can carry it forward to the next year – but only for one year.

Each tax year, you can also give away additional gifts if they relate to special events such as weddings, birthdays or Christmas, or if they support the living costs of another person, such as an elderly relative or a child under 18.

You can also give as many gifts of up to £250 per person as you want during the tax year as long as you have not used another exemption on the same person.

However, other gifts count towards the value of your estate, and you could be charged IHT if you give away more than £325,000 in the seven years before your death.

Business Property Relief or Agricultural Property Relief

Certain assets receive relief from IHT, these include Business Property, Agricultural Property and Heritage Assets.

These reliefs can reduce or eliminate the value of an asset being included within an estate, but they often rely on certain conditions being met. However, not every interest in a business will qualify for these specialist reliefs so it is worth seeking specialist professional advice when managing your estate.

Charity

Anything left to charity in your Will won’t count towards the total taxable value of your estate. Known as a ‘charitable legacy’, this will also reduce the IHT rate on the rest of your estate from 40 per cent to 36 per cent, as long as you leave at least 10 per cent to charity.

Trusts

Trusts can play a role in reducing a family’s exposure to IHT so that more can be passed on to future generations, but they say they can also help look after family assets and provide for family members who are too young or vulnerable to deal with financial matters.

One of the main benefits of a trust is that, should you elect to act as the trustee, you would continue to maintain control over the assets gifted whilst your estate’s exposure to IHT is reduced as, after seven years, the gift is out of the Settlor’s estate completely.

Assets transferred into a trust are no longer considered as belonging to the Settlor, so they are taxed according to the rules governing the trustee.

Many people would prefer to provide for a beneficiary through a trust as opposed to passing assets to them outright. This could involve a source of income for a beneficiary for life or providing education for children but not allowing them to access funds until they are older.

If you would like more information or advice about Inheritance Tax planning, please get in touch with our expert team.

When the new ‘no-fault’ divorce rules were proposed there were fears that they would lead to a huge rise in cases.

Now, several months since their introduction, the first indications of their impact on divorces have been revealed.

According to the latest data from HM Courts & Tribunals Service, almost 13,000 applications were filed in April.

Of these, nearly a fifth were made jointly by couples, following changes in the rules that permitted joint applications for the first time.

Oddly enough, the number of applications in April after the new rules were enforced is similar to the number of divorces launched in March.

According to speculation from some family lawyers, this may be the result of couples already near agreement trying to get cases sorted and financial settlements underway before the rule change complicated matters for them.

However, when compared to previous years, there is an obvious jump in divorce applications. In February this year, 9,400 cases were filed, while in April 2021 only 8,700 applications were made.

“These figures reflect the ‘bulge’ we expected as the new law came into effect,” according to  Law Society Vice President, Lubna Shuja.

“By not having to prove a fault-based fact against their ex-partner, separating couples and their children will not have to suffer unnecessary conflict and anxiety.”

Surjit Verdi, a Director and family law expert with Palmers, said: “There is no doubt that removing the need to apportion fault will make the divorce process less confrontational.

“Few people would argue that this is a more modern and indeed mature way of dealing with the breakdown of a relationship as, in the past, pointing the finger of blame often caused more harm than the divorce itself.

“Divorcing couples are now, quite rightly, able to spend more time focusing on the future, such as the wellbeing of their children and how finances can be split.”

To find out more about our family law services, including separation and divorce, please contact us.

Latest figures from the Home Office, which have been analysed by the AA, found that last year 565,000 drivers were prosecuted for a range of motoring offences – up 22 per cent on the previous year.

The overall increase in convictions coincided with a rise in traffic during 2021, after coronavirus lockdowns caused a sharp fall in journeys during the previous year.

Given that motoring convictions are on the increase, Jeremy Sirrell, a Director with Palmers, who specialises in motoring offence law, has provided a brief overview of the most commonly prosecuted offences and explains what you need to know if you stand accused:

Careless Driving

You may be accused of driving without due care and attention (commonly known as “careless driving”) when it is alleged that the standard of your driving fell below what would be expected of a competent and careful driver. The penalty for careless driving is a fine and three to nine points on your licence or a disqualification depending on the seriousness of the offence. Our experts can advise on the evidence and put forward a defence and/or mitigation to reduce the level of any penalty imposed.

Dangerous driving and offences resulting in injury or death

If you are accused of dangerous driving or a driving offence resulting in injury or death, you may be facing Crown Court proceedings and serious penalties including imprisonment.  We can advise you on the evidence and any potential defences and/or mitigation and are able to provide you with representation to ensure the best possible outcome.

Drink or drug driving

If you are guilty of driving under the influence of drink or drugs, you will normally be disqualified from driving for at least twelve months. This is a complex area of law requiring the police to follow the correct procedures. Our experts can advise you on whether you have a potential defence or, in certain limited circumstances, reasons to attempt to persuade the court not to disqualify you.

Speeding

If you are accused of driving at high speed, you may face disqualification from driving which in turn may impact upon your livelihood. We can assist by putting forward reasons on your behalf to avoid or reduce the period of disqualification.

“Totting up” disqualifications

If you are in danger of having your licence endorsed with penalty points which bring the total number of points on your licence to twelve or more within a three-year period, you will be facing the possibility of a “totting up” disqualification, usually for a minimum period of six months. We can advise you on whether there are mitigating circumstances to avoid or reduce such a ban and put those factors to the court on your behalf.

How Palmers can help:

Jeremy qualified as a Barrister. He worked as an adviser to the magistrates and for the Crown Prosecution Service, before joining Palmers Solicitors. As such, he has a uniquely wide experience of the criminal justice system and is able to advise on all matters relating to road traffic work from the simplest and most minor to the most detailed, complex and serious matters.

Jeremy has also produced a series of short five-minute Tik Tok videos on a range of motoring law topics including the challenges of driverless cars, drink drive limits, a campaign to stop crashes being termed ‘accidents’ and the rise of e-scooters.

You can follow Jeremy Sirrell’s entertaining and informative Tik Tok series here.

For further information about our motoring offences legal support, please get in touch with us.

A beauty therapist, who was sacked just two weeks after announcing she was pregnant, has won her claim for unfair dismissal.

The woman, who worked at a health spa, has won more than £14,000 as part of the Employment Tribunal settlement.

At the time of the dismissal, Homefield Grange Retreat said they could not afford to keep Ms Agata Plewa because of a downturn in business, but it was discovered the company took on a new employee at around the same time Ms Plewa was made redundant.

This was despite Ms Plewa being described by her employers as ‘an absolute pleasure to work with and a true professional.’

The tribunal ruled that Ms Plewa had been sacked because of her pregnancy, and has now been awarded £14,257 in compensation.

In communication with her employers, Ms Plewa, who started the company in February 2017 as an aesthetic beauty therapist, was told she was an ‘exceptionally good’ employee.

The tribunal heard that the claimant announced she was pregnant on 3 July 2018, who then had a very strange email from her employers on 7 July effectively asking Ms Plewa what she wanted to do and by 14 July without any warning, she was made redundant.

The original judgement found Ms Plewa was treated less favourably because of her pregnancy by being dismissed and that dismissal was automatically unfair due to her pregnancy under the Employment Rights Act 1996.

Recent research by the Equality and Human Rights Commission has suggested that around 54,000 new mothers may be forced out of their jobs in Britain each year.

The findings were based on a survey of over 3,200 women, in which 11 per cent reported having been dismissed, made compulsorily redundant where others in their workplace were not, or treated so poorly they felt they had to leave their jobs.

If replicated across the population as a whole, this could mean as many as 54,000 women losing their jobs each year.

Samantha Randall, an Associate Solicitor with Palmers, who specialises in employment law matters said: “The Equality Act 2010 protects women against direct discrimination and victimisation because of the protected characteristic of pregnancy and maternity.

“This means that although you can be made redundant during pregnancy, you cannot be made redundant because you are pregnant. It’s an important distinction and if you suspect that your employer is treating you differently or unfairly based on either your pregnancy or maternity-related issues, it is important to seek specialist legal advice to understand your rights and possible legal redress.”

For help and advice on related employment matters, please get in touch with our expert employment law team.

A growing number of over 70s could be at risk of large Inheritance Tax bills due to their lack of marital status.

It comes as research has shown that the number of over 70s choosing to live with their partner rather than marry or enter a civil partnership has surged by 288 per cent over the last 20 years.

Over the years cohabitation has increased in popularity, which is now having an impact on couples being hit with large Inheritance Tax bills and being forced to sell their home.

There has reportedly been an increase in the number of unmarried couples over 65 seeking professional advice, whose homes are subject to Inheritance Tax when one partner dies.

Helen Jago, a Director and expert in Inheritance Tax and Older Client matters, said: “With unmarried partners there is no spouse or civil partnership exemption so inheritance tax could be payable on the home they live in when one party dies either owning all or part of a property”.

“As well as mourning the loss of a loved one, the surviving partner may even have to sell the family home to fund the inheritance tax, leading to further stress at a difficult time”.

What action can cohabiting couples take?

To reduce this problem, cohabiting couples could ensure the home is in common ownership when they purchase it to ensure peace of mind for the future.

It is also a good idea to get professional advice for succession planning so surviving loved ones are not left with added stress and insecurity.  If there is likely to be inheritance to pay this can be factored into the succession plans.

Inheritance Tax is something we don’t want to think about, but it is important that you understand your liabilities when the time comes. Couples should talk about their situation, so they understand potential future Inheritance Tax liabilities.

When do you have to pay IHT?

Currently, the threshold to pay Inheritance Tax is £325,000. Therefore, it will not be due if the value of the estate amounts to less than £325,000.

The standard rate for Inheritance Tax is 40 per cent, but this is only applied to the amount above the £325,000 threshold.

Additional Residence Nil Rate Bands are available when leaving property to your children.  It is important to note however, that this additional tax-free amount is not available when leaving your property to your unmarried partner.

For advice on Inheritance Tax and related issues, please get in touch with us.