Case study A was married to B. After B’s death, A got remarried to C. On A’s death, the executors wish to preserve A’s NRB for the executors of C’s estate to claim on C’s death. Transferable nil rate band (TNRB) Each person’s estate is exempt from inheritance tax (IHT) up to a certain threshold, known as the nil-rate band (NRB). The NRB is £325,000 for the tax year 2016/17, and it will be frozen at this level until 5 April 2021. If a person (A) dies after 9 October 2007, it is possible for the unused percentage of the NRB from A’s late spouse or civil partner (B) to be transferred to A’s estate. This called the transferable nil rate band (TNRB). The TNRB can increase the NRB available to the surviving spouse’s estate by up to 100%. Additionally, if a lifetime

Section 1 of the Wills Act 1963 (WA 1963) sets out the general rule as to formal validity of a Will and in general terms provides that a Will is treated as properly executed if it was made in accordance with the internal law of the country where the Will was executed, or where the testator was domiciled or habitually resident, or of which they were a national at the time the Will was executed, or at their death. For example, a Will executed in accordance with the laws of Scotland by an individual domiciled or habitually resident in Scotland or with Scottish nationality

Under section 19 of the Financial Services and Markets Act 2000 a person cannot carry out a regulated activity, or purport to do so, in the UK unless they are either an authorised person (ie authorised by the Prudential Regulation Authority and/or the Financial Conduct Authority (FCA)), or an exempt person (eg by being an appointed representative). For an overview of the regulated activities regime in the UK, see Practice Note: What are regulated activities? Activities are regulated if they are of a ‘specified kind’ (ie specified by the Financial Services and Markets Act 2000 (Regulated Activities) Order 2001 (RAO 2001), SI 2001/544) which is carried on by way of business. For more information about what it means to carry on a regulated activity by way of business in the UK, see Practice Notes: What does 'by way of business'

Where an individual gifted a property to their children several years ago but continued to live in it, creating a gift with reservation of benefit (GWR), the details of the property and gift will need to be recorded on Schedule IHT403 for inheritance tax (IHT) purposes following their death. Under section 102 of the Finance Act 1986, property subject to a GWR is treated as part of the donor's estate immediately before their death and is therefore liable to IHT. While HMRC may request the value as at

What potential action would the deceased have had against the appointee? What action might the personal representatives have now? Financial abuse of the elderly by carers or members of their own family sadly seems to be on the increase. The causes of action vary depending on the type of financial abuse which has occurred, and also on whether the vulnerable person had capacity to manage their affairs or not. You may find useful the following Practice Notes useful in relation to this section of your query: • Financial abuse—detection and prevention • Fraud tracing and other remedies What

This Q&A assumes that the member’s rights under the RAC all consist of existing and not future property rights. Retirement Annuity Contracts (RAC) were first introduced by the Finance Act 1956 as defined contribution arrangements for individual members. They were subsequently governed by section 226 of the Income and Corporation Taxes Act 1970, and were sometimes known as 'section 226 Policies'. Following the introduction of personal pension schemes on 1 July 1988, it is no longer possible to establish new RACs, but RACs established prior to that date can continue in operation and contributions can still be

An individual acting for a company under a power of attorney, delegating that power to another A general power of attorney is a basic document that gives the attorney the power to deal with the donor’s financial affairs. It can be as wide reaching or as limited as the donor wishes. Powers of attorney are a form of agency but they differ from conventional commercial agencies in that they confirm to a third party that the attorney has power and the extent of that power, rather than governing the relationship between

A general power of attorney governed by Powers of Attorney Act 1971 is the most commonly used appointment for commercial transactions. This power of attorney can be used to authorise the attorney to do anything that the individual donor can lawfully do. However, it does not authorise an attorney to do anything that is personal to the donor's special status (eg if the donor is a priest or a solicitor),

A grant of letters of administration is required where the deceased died intestate. The order of priority of entitlement follows the entitlement to an intestate’s estate and is set out in the Non-Contentious Probate Rules 1987 (NCPR 1987), SI 1987/2024, r 22(1). We refer you to the following Q&A which, in the first part of the answer, considers a similar scenario to your question: The deceased died intestate with assets of less than £10,000 and liabilities of around £15,000 (ie an insolvent estate). The deceased's wife is entitled to the estate under the intestacy rules but does not have

We have assumed from the question that the deceased was unmarried and is survived by their sole minor child who is entitled to the whole estate on intestacy. The position may be different if the child’s surviving parent also has an entitlement to the deceased’s estate (i.e. as surviving spouse or civil partner). It is not clear why the firm is holding money on client account and the extent to which these funds fall within the deceased’s estate. These factors may have a bearing on how the firm is able to deal with the funds following the deceased’s death. The office of administrator

A guarantee is an agreement by way of contract where the guarantor agrees to perform the obligations of another. Guarantees are commonly seen in contracts and in leases, to the effect that if the principal does not comply with their obligations (for example to pay a loan, or in this scenario to comply with the lessee covenants under the lease of the third party), the guarantor will be liable. As a result, should the tenant default, the landlord is entitled to look to the guarantor (often to take on the lease, but otherwise to

In answering this Q&A, we have assumed that the lasting power of attorney (LPA) has been signed as a donor and that the donor was unmarried when they made the LPA but have subsequently changed their name on marriage. In that case, you will first need to confirm that the LPA is in the prescribed form and has been validly executed. The Practice Note: Creating a valid LPA outlines the requirements for a valid LPA. Assuming that the LPA is in the correct form and has been validly executed, it is then necessary to consider whether there is another reason it may fail at the point of registration, namely due to the donor’s name change. For further information on the registration of LPAs and common objections to their registration, see Practice Notes: LPAs—registration procedure and LPAs—registration objections. For further commentary on LPAs, see Commentary: Factual