Whitebrook Wills Blog

The average cost of a funeral or cremation has soared 80% in the past ten years to around £3,456 and the current government relief is not sufficient to cover this bill.

Rev Bryan Kerr, minister at Greyfriars Church in Lanark, is urging the UK government to help bereaved families who lack funds to pay for funerals by supporting them with money collected through taxation. Besides, approximately half of people applying for support are not successful and those who eventually have their requests approved receive just £1,225 on average, Kerr said as quoted by the Express and Star.

In his area, the cost of a burial has skyrocketed 345% in five years, the Herald reported.

The Church of Scotland minister is urging the government to use National Insurance to provide a basic allowance, which can be topped up if people want to hold a more elaborate funeral ceremony.

Funeral poverty is affecting some of the most vulnerable people in the society, forcing them to resort to payday loans to cover funeral expenses. This pushes them further and further into debt, Rev Kerr told the General Assembly of the Church of Scotland last week.

He also believes that taxes should be increased to help cover rising funeral expenses. This would benefit everyone, he said.

In order to ensure the viability of a scheme offering state insurance for funerals, local authorities need to curb their costs as well. This means that councils and organizations providing burial and cremation services should rein in their charges, according to Rev Kerr.

Gifting property to reduce inheritance tax is a popular way of ensuring that more of the money you make in your lifetime goes to your loved ones when you die, rather than to the taxman.

Gifting property to your beneficiaries whilst you're alive means that the value of your estate will be considerably reduced. If the gifts are made outright however, this does mean that you will not receive any share of the money if the property is sold, or rented out. Under the Potential Exemption Transfer rules Inheritance tax total exemption will only be granted if you do not die within seven years of making this gift.

Alternatively, the property can be part gifted, which means that you and your beneficiaries will all become part owners. In this way, the parts of the property you don't own may be exempt from IHT, but you can still receive an income.

Finally, by releasing equity on the property and gifting that to the beneficiaries, the estate loses some of its value and the property remains entirely within your ownership.

 

An unemployed woman who allegedly made no attempt to find a job because she was waiting for her mother to die is battling her brother in court over the inheritance. Christine Watts, who claims benefits, has "done nothing to get a job" since 2005 because she expected to be rescued by a share of her mother's £200,000 estate, the High Court heard.

Miss Watts says she has back problems and psychological issues which make it impossible for her to work and that made her "dependent" on her late mother, despite being an adult.

However, the 47-year-old from Eastbourne, East Sussex, was written out of the will of her mother, Valerie Watts, who changed the paperwork on her deathbed, leaving her house and all her savings to her son Gary, 44.

Miss Watts is now challenging the validity of the will, dated January 2011, arguing that it must have been forged or was not properly executed, while claiming she is entitled to "reasonable provision" from her mother's estate.

She is now locked in a legal dispute with her brother as they fight over their mother's home in Dartford in Kent, and the savings that she left behind when she died aged 71 after signing her will in hospital during her final illness.

Mr Watt believes he deserves every penny of his inheritance for the years he spent caring for his mother, but his sister is fighting to convince Judge Catherine Newman QC that she is due a fair share.

Explaining why Valerie Watts had cut his sister out of her will, Gary Watts said: "She was extremely disappointed with the conduct of my sister. She said basically she wanted to change the will.”

Miss Watts insisted that she had enjoyed a close relationship with her mother, regularly visited her during the last part of her life and spoke to her daily on the telephone. Judge Newman reserved her decision on the case until a later date.

 

The number of estates that will be liable to pay Inheritance Tax (IHT) will surge in the coming years according to recent reports.

House prices are rising at their fastest in years with think tank the Centre for Economics and Business Research recently predicting they would rise 24pc by 2018. In London, the average property would then be worth a staggering £566,000, it calculated.

But what is going nowhere is the inheritance tax threshold, currently at £325,000 per person and expected to remain at that level until 2019. Above that limit, estates are taxed at 40pc. The result? An increasing slice of families’ wealth is being shorn away by the taxman.

Currently, the number of households expected to pay IHT accounts for 5.5% of the total, but according to the calculations that share will jump to 12% by 2018, the end of the IHT nil-rate band freeze.

Four years ago, then-Shadow Chancellor George Osborne pledged to free families from the need to pay death duties by hiking the IHT threshold to £1 million, from £300,000 at that time. When making his most recent Budget statement, however, he decided to keep the nil-rate band unchanged until 2018, meaning more families have to pay Inheritance Tax.

That’s why more and more are using their Wills and Estate Planning to attempt to avoid some of this increased burden.