Latimer Hinks Director Elizabeth Armstrong said: “We all go into a New Year with the best of intentions, but often our resolutions fall by the wayside because we don’t keep up a diet or fitness regime. Making a financial resolution is different. Taking just a little bit of time in 2016 to plan for the future could have a beneficial impact for years to come.
The firm is urging people to:
- Make a will. Two-thirds of people in the UK don’t have a will. For those people who die without leaving a valid will, their property will be shared out according to the rules of intestacy. That means if you have children, your spouse will get the first £250,000 with any personal possessions plus half of any residue. If you haven’t written a will, it could lead to family arguments and bitterness following your death. When artist Pablo Picasso died without a will at the age of 91, for example, it took six years of legal battles until his heirs finally benefitted from his estate.
- Update your will. If you have already made a will, don’t forget that it needs to change when your circumstances do. Actor Heath Ledger, who died after taking a drug overdose, had made a will but failed to update it to include his daughter Matilda following her birth.
- Succession planning. It’s vital to think about and put in place mechanisms to make sure your wishes are carried out once you die or, if earlier, decide, or need, to step back from your business.
- Tax planning. Get advice to minimise your inheritance tax and capital gains tax liabilities. After all, you want to leave as much of your hard-earned money and assets to your nearest and dearest, rather than the taxman.
- Buy or sell at the right time. If you’re thinking about making a property investment, make sure you get your timing right to cut costs. An extra 3% in stamp duty will be payable on the purchase of second properties from April 2016.
- Power of attorney. Who makes the decisions for you when you can’t decide for yourself? While no one wants to think about the worst happening, giving someone you trust the legal right to act for you through a Lasting Power of Attorney will give you peace of mind that your wishes will be carried out if the worst happens.
- Get the right advice. If 2016 is going to be the year you start your own business, or expand an existing one, seek advice to make sure you have the structures in place to give yourself the best chance of success, whether you are a sole trader, partnership or limited company.
- Give a cash gift. You can minimise how much your loved ones will have to pay in tax on your estate upon your death by handing them cash gifts now. You can give gifts of up to £3,000 every tax year, as well as handing out large cash sums if your children or grandchildren are getting married, without any inheritance tax being paid.
- Think about your digital legacy. While most of us have some sort of social media account, how many of us have considered what will happen to our Twitter or Facebook pages when we’re no longer around. Drafting an addendum to your will can give you the opportunity to set out your wishes, including any final messages you wish to be uploaded when the time comes.
- Sign the Latimer Hinks petition. Latimer Hinks is campaigning to change inheritance tax rules so they are the same for those without children as those with descendants. New legislation means by 2020/21, couples will be able to leave homes worth up to £1m to children without paying Inheritance Tax. Those without children, grandchildren or stepchildren will not benefit from the same allowances. Latimer Hinks is urging the Chancellor make these tax rules equal for everyone https://petition.parliament.uk/petitions/105736