Inheritance Tax: Can you use the same Will laws Prince Philip utilised? Rules explained | Personal Finance | Finance
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Will procedures for the Royal Family have conventionally remained stable for over a century now as following the death of a senior member of the Royal Family, the courts are asked to seal their Wills away from public view. This means unlike most wills granted probate, they will not be open to public inspection and there will be a private process in 90 years to decide if they can be unsealed. The High Court recently announced the Will of Prince Philip will remain secret for 90 years to protect the “dignity and standing” of Queen Elizabeth II and following this, James Cook, a partner at Collyer Bristow, broke down if non-royalty also have the same option.
Mr Cook explained why the need for such measures is so paramount to the Royal Family.
“Since the early 20th century, it is convention that the Will of a deceased senior member of the Royal Family should be sealed up and kept private,” he said.
“The same applies to the value of the estate which would otherwise be included on the grant of probate. Irrespective of the longstanding convention, it cannot be disputed that the contents of a senior Royal’s Will could be highly sensitive. If the contents of a senior Royal’s Will was in the public domain, then this could impinge on the dignity of the Royal in question and result in the harassment and intrusion into the private lives of the named beneficiaries, which would be wholly disproportionate to any potential wider public interest benefit.
“That said, it is possible to prepare a Will which discloses limited sensitive information on the basis that the testator of the Will leaves all or part of their estate to trustees to hold in accordance with a detailed letter of wishes. Although not legally binding on the deceased’s trustees, a letter of wishes is a confidential document only for the eyes of the trustees and serves as an additional layer of privacy.”
Mr Cook went on to examine if the same options can be applied for regular families: “When an individual dies and it is necessary to obtain a grant of probate, the deceased’s Will becomes available to the public to view. This is nearly always the case, most certainly for the general public. Nevertheless, in exceptional circumstances (i.e. where the disclosure of a Will is contrary to public interest or national security) it is possible to seek an order from the court for the Will to remain private and ‘sealed up’.
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“To this effect, since the early 20th century it is convention that the Will of a deceased senior member of the Royal Family should be sealed up. The same applies to the value of the estate which would otherwise be included on the grant of probate. It would be difficult to dispute that the contents of a senior Royal’s Will could be highly sensitive. If the contents of a senior Royal’s Will were in the public domain, then this could impinge on the dignity of the Royal in question and result in the harassment and intrusion into the private lives of the named beneficiaries, which would be wholly disproportionate to any potential wider public interest benefit.
“Seeking an order for a Will to be sealed up is unlikely to be an option unless you are a senior member of the Royal family and thus it is common, where there may be a requirement for confidentiality to prepare a Will which discloses limited information on the basis that the testator of the Will leaves all or part of their estate to trustees to hold in accordance with a detailed letter of wishes. Although not legally binding on the deceased’s trustees, a letter of wishes is a confidential document only for the eyes of the trustees and serves as an additional layer of privacy.”
Going forward, many families may want to look into their options in regards to shielding or hiding Will details, as recent analysis shows inheritance disputes are on the rise. Unfortunately, the impact of coronavirus may also be making the issue worse.
JMW Solicitors, the contentious probate law firm, revealed in early September there has been a sharp increase in enquiries relating to inheritance disputes and the contesting of Wills. On top of this, JMW Solicitors noted fewer families are leaving their estates to children.
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JMW Solicitors detailed that, in comparison with the previous six months, enquiries had risen by 111 percent between October 2020 and April 2021. The company explained although an increase in unexpected deaths due to the COVID-19 pandemic had “undoubtedly” contributed to intestacy rates, experts warned inheritance disputes were already on the rise in England and Wales.
Analysis from JMW Solicitors showed one in four adults would now contest a Will if they didn’t feel it was correctly distributed and a “common misconception around inheritance law” across England and Wales is another contributing factor to the rise in contentious probate cases.
Alison Parry, partner and head of will and trust disputes at JMW, commented: “Say you have got an estate that’s worth £200,000. When you have got two or three people arguing over that pot of money and each person has their own lawyers, very quickly you could see half of that pot disappear in legal costs before you have got anything off the ground.”
Joe Cobb, a partner at JMW Solicitors, also examined how traditional inheritance traditions are facing resistance and this too could create conflict.
“Traditionally, children are the chief beneficiaries when a parent dies — however we are increasingly seeing clients who do not wish to leave the whole of their estate to children for various reasons,” he said.
“Some wish to encourage their children to make their own way in life, while others prefer instead to pursue charitable or philanthropic aims, or to protect the estate for future generations beyond their children. Historically, moral obligation has played an important role — parents have felt that they must provide for their children and that view is also supported by law.”
Mr Cobb warned in some circumstances, children can bring claims against an estate if they have been totally excluded. To illustrate how prevalent this could become, JMW Solicitors shared that it had already seen a “staggering” 260 percent year-on-year rise in contested probate cases.
Wills created during the pandemic are already facing difficulties in terms of validity. This could prove costly down the line as Debra Burton, a Partner at Lime Solicitors, broke down how these issues will impact IHT bills.
“So called ‘Covid Wills’ have led to an increase in Will challenges,” she said.
“We are seeing more will validity challenges based on the will not being properly witnessed. The rules on how to make a Will are complicated for lay people to understand, particularly around witnessing. Lockdown made the problem worse as it could prove very difficult to find one witness, never mind two. There are also still a lot of myths around Wills, particularly online e.g. Wills can be signed electronically (they can’t – it still needs a wet signature) or only one witness is now needed.
“Disgruntled beneficiaries are now focussing more on how the Will was witnessed and testing the evidence of the witnesses where previously they may not have bothered if it looked fine on its face. Challenging a will based on lack of proper witnessing can be an easier claim to bring (therefore cheaper) than a claim based on lack of testamentary capacity, for example. There is no need for expert evidence or judicial discretion if the witness evidence is clear. Either the Will was witnessed properly – so it’s valid or it wasn’t – so it fails. It’s very black and white.
“Allegations of undue influence are also on the rise. Traditionally the courts have been very reluctant to overturn a Will based on undue influence unless there is very clear and convincing evidence to support the allegation – which is almost never available. However, lockdown gave an unprecedented opportunity for vulnerable people to be forced into making a Will that they didn’t really want. Testators were literally locked away with certain family members and kept apart from others. Lawyers await the first undue influence Covid cases to make their way through the court system to see if the court is prepared to now accept that such controlling and coercive behaviour does go on.
“Will challenges can also lead to problems with inheritance tax. If a Will is successfully challenged due to a witnessing mistake, then it may unravel the testator’s careful estate planning which was designed to save inheritance tax. Alternatively, a Will executed in suspicious circumstances or even one just made in haste as a result of the pandemic could end up overruling an earlier tax efficient Will or having unintended tax consequences. This could result in a double whammy to the estate – large legal costs and an unexpected inheritance tax bill.”
According to Money Helper, the public financial advisory service, four key steps should be followed in the creation of a Will:
- Step one – make a list of who you want to benefit from your estate
- Step two – write down your assets and roughly what they’re worth
- Step three – think about how you want to split your money and property when making your will
- Step four – check if you’ll have to pay Inheritance Tax
Money Helper noted where an estate is quite simple, Wills can probably be done by the estate holder themselves. However, where a situation is more complex, it is “sensible to take advice from a solicitor.”
Impartial guidance on Wills can also be sought from Citizens Advice, which notes for a Will to be valid it must be:
- Made by a person who is 18 years old or over and
- Made voluntarily and without pressure from any other person and
- Made by a person who is of sound mind. This means the person must be fully aware of the nature of the document being written or signed and aware of the property and the identity of the people who may inherit and
- In writing and signed by the person making the will in the presence of two witnesses and
- Signed by the two witnesses, in the presence of the person making the will, after it has been signed.
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