X

COVID-19 (Coronavirus) – Gemini Update - January 2021

In line with current Government guidelines, we have taken the decision to reduce the numbers of staff at our Head Office in Sutton Coldfield with the majority of staff returning to working remotely.

However, to reassure you, it is business as usual and we are still available to contact by phone and email as all our systems can be accessed and operated remotely.

Indeed, it is times like these where you may need to seek additional advice from financial services professionals. Both our Wealth Managers and Estate Planning Consultants remain available to assist you and are able to offer guidance on the phone, by email or by video technology.

Please contact us FREE on 0800 255 0123 or email info@gemini-wm.com where we will do our best to assist you.

We would also like to extend our offering to your family, friends or colleagues so please do pass on our details. We are here to help!

Please scroll for more information.

A Guide to Estate Planning

Back to News & Views

A strong estate plan can help to reduce tax, protect your legacy, and ensure that more of your money passes to your loved ones. The decisions can be difficult, but once in place, your estate plan will make things easier for you and your family later in life.

Here, we look at the main features of an estate plan and how they can benefit you.

Wills

Writing a will should be a high priority within your estate plan. This will allow you to direct your representatives (or executors) as to how you would like your assets distributed on your death.

Your will could be very simple, for example, you may want your spouse to inherit everything, followed by your children.

Alternatively, you might wish to make multiple gifts, arrange charitable donations, and set up trusts.

Perhaps your family situation is complex and you have a second marriage or blended family to consider. Maybe you have relatives that you are not in contact with and wish to ensure that they do not inherit anything.

If you die intestate (without a will), you will not have any control over these decisions. Your assets will be distributed according to a strict order of priority. This will depend on the value of your assets and where you live in the UK.

The intestacy rules are particularly severe when it comes to unmarried partners. Common law marriage is not recognised in the UK and only a legal spouse or civil partner has an automatic right to inherit. Similarly, carers, stepchildren (unless legally adopted), or close friends would also be excluded, while estranged relatives could take priority.

Writing a will is a relatively simple and inexpensive process. It’s easy to put this off, but remember your will can be easily changed. An imperfect will that is regularly reviewed is better than no will at all.

Powers of Attorney

A Power of Attorney (POA) is used to appoint a trusted relative, friend or carer to make important decisions for you if you lose capacity.

The two types of POA are:

  •         Property and Financial (covering bills, investments, and property maintenance)
  •         Health and Welfare (care, medical treatment, and end of life decisions)

Your POA must be created while you still have full mental capacity. It also needs to be registered with the Office of the Public Guardian.

If you lose capacity and don’t have a POA in place, the court will need to appoint someone to make these decisions for you. This can result in delays, distress, and choices being taken out of your hands.

A POA is simple to set up and register, and can normally be created at the same time as your will.

Trusts

A trust allows you to gift assets without giving up full control. You can set up a trust during your lifetime, or to take effect on your death. You will need to appoint trustees to be responsible for managing and distributing the money. You can be a trustee yourself, although it is sensible to appoint at least one other person.

The main types of trust are:

  •         Discretionary, where the trustees have discretion over how, when, and why to distribute the trust’s assets, within the terms of the trust.
  •         Bare/Absolute, which is similar to an outright gift, although without giving the beneficiaries full control at outset. This type of trust might be used for a minor child.

You may want to set up a trust to:

  •         Reduce the value of your estate for Inheritance Tax (IHT) purposes.
  •         Set aside funds for a particular person or category of beneficiary, separate from your own assets.
  •         To ring-fence the money from the beneficiary’s own assets. This can be useful if the beneficiary gets divorced, is declared bankrupt, loses capacity, or makes poor financial decisions.
  •         Direct who should receive income from, or be allowed to use the trust assets, while holding the capital for someone else at a later date.
  •         To receive life policy benefits outside your estate.

It is worth seeking advice on the most suitable type of trust. There will be considerations around tax, risks, and charges that you will need to take into account.

Lifetime Gifts

The simplest way to create a legacy is to make gifts during your lifetime. Not only does this give you the satisfaction of seeing your loved ones benefit from the money, but it can also be tax efficient.

Lifetime gifts are treated as follows:

  •          You can give away up to £3,000 per year, which is immediately outside your estate. This can be carried forward by up to one tax year as long as the current year’s allowance is fully used.
  •          There are also exemptions for Christmas, birthday, and wedding gifts.
  •          Other gifts may also be immediately exempt, providing they are made from surplus income and form a regular pattern.
  •         Larger gifts remain within your estate for seven years. If the value is over £325,000, the Inheritance Tax payable by the recipient of the gift on your death will reduce by 20% per year from the end of year three onwards.
  •         Any gifts into trust may be immediately chargeable. The rate of tax is 20% of the value over £325,000 (or less if you have made previous chargeable gifts in the last 7 years). If you die within seven years, a further 20% is payable, although this reduces between years three and seven.

It's worth considering gifts on an annual basis, as this can reduce your estate, pass more money onto your beneficiaries and ensure that you dont leave yourself short in later life

The Financial Conduct Authority does not regulate Wills, Trusts, Tax and Estate Planning

 

I

Book your FREE, no obligation discussion today. Schedule Appointment

Sign Up to our mailing list - Receive regular news, tips and financial commentary from the Gemini Team.

Latest News

  • Sustainability is an important measure of a company’s credibility, whether the industry is food production, travel, or fashion. It has become increasingly relevant to the investment process, as companies aim to operate more ethically, and consumer appetite for sustainable investing has risen. [...]

  • Just over a month since the Budget, what does it mean for you? We have highlighted the key points to note, following Chancellor Rishi Sunak's announcement [...]

  • Getting divorced is one of the most stressful life events you can experience. You need to consider living arrangements, splitting of assets, custody of children – and that’s before thinking about the emotional toll it can take. [...]

  • A strong estate plan can help to reduce tax, protect your legacy, and ensure that more of your money passes to your loved ones. The decisions can be difficult, but once in place, your estate plan will make things easier for you and your family later in life. [...]

  • In financial planning, we often have to prompt our clients to think about worst-case scenarios. This is not always a pleasant exercise, as no one likes to think about their own mortality or the loss of a partner. [...]

  • Delivering the Budget in Parliament on 3 March 2021, Chancellor of the Exchequer Rishi Sunak said, ‘This Budget meets the moment with a three-part plan to protect the jobs and livelihoods of the British people. [...]

  • While no one likes to think about death or ill-health, a few simple decisions now can help you keep control of your assets and reduce stress for you and your loved ones later in life. [...]

  • The concept of buying low and selling high is well known. Achieving this consistently will inevitably result in profit. The ‘secret’ is knowing when to buy and sell. An investor may believe that a particular company is likely to do well following an event in the news. The consensus is that the share price will increase and that the investment will perform well if bought at the right time. [...]

  • Tax planning does not stop at retirement. When you have spent a lifetime working, it’s only natural to want to make the most of your hard-earned money. [...]

  • Financial planning can be complex, and the best solution for one person often doesn’t work as well for someone else. It’s easy to become focused on investment returns, when really, this forms only part of the picture. [...]

  • The UK has been out of the EU since 31st January 2020, however it took almost a further year to reach agreement over a deal. While this has been a source of relief, there are some areas still to be finalised, and no guarantee that the terms agreed now will continue indefinitely. [...]

  • After the (more or less) steady market growth over the past five years, the recent volatility has come as a shock to many investors. The economy is cyclical, and downturns are a feature of investing. We have to assume they will occur, just as we understand that they are usually followed by a recovery, during which any losses are more than recouped. It’s impossible to predict the timings, but over a lifetime of investing, it’s reasonable to assume that short periods of volatility will be ironed out. [...]

Gemini Wealth Management Ltd is Authorised and regulated by The Financial Conduct Authority Registered in England & Wales No. 5919877 Registered Office: Gemini House, 71 Park Road, Sutton Coldfield, West Midlands B73 6BT The Financial Conduct Authority does not regulate tax and trust advice, will writing and some forms of buy to let mortgages. The guidance and/or advice contained in this website is subject to regulatory regime and is therefore restricted to those based in the UK.

Website by Mellow Marsh Software
© Gemini Wealth Management Ltd
Privacy Notice | Cookie Policy