Money judgment - Assignment Example

Unless you make a will, your favourite persons may fall in problem when you will be no more in the world because the laws of intestacy suggests that your estate will not automat-you to realize easily what's the result of not making a will. Before making a will you need to be sure of the total sum of the property you have and you would like to distribute. Furthermore, you also have to know the fact among whom persons you can distribute the property by making a will. I think it's better for you to make a reciprocal will so that you and Jennifer can mirror each other in that case when one of you will die the property will go to the survivor and then to your children.

There are certain elements what make a will legal. -"You should never attach anything to your Will by way of a paper clip, pin or otherwise or in any way leave any mark on it. Such marks can cause great difficulty when it comes to prove your Will in the probate registry. -You should have an idea about the tax liability on your death as many married people are quite unaware of the potential tax bill they leave to their family on the death of the second partner" (Life Insurance.com.uk., n.d.). In spite of achieving cherished effect it contains mentionable draw back from inheritance tax system, because the liability goes to inheritance tax that's why in the time of next death of the survivor, this tax will go to your join property.

It has been decided in the tax year of 2006/2007 inheritance tax is not necessary to pay between the spouse. "Transfer between spouses is generally free of inheritance tax. If an individual simply leaves all their estate to their surviving spouse then the nil-rate band is effectively wasted" (Deloitte, 2007). When (Mr. Hoames) you will die having made no chargeable transfers when your survivors will not be benefited by this nil-rate band. If you leave your enter estate to Mrs Jennifer and she will set 312000 of nil rate band against her inheritance tax estate.

However, this tax liability may go to the others (such as your relatives) if the total value of the property exceeds 285,00 (2006-2007). And excess value above the nil rate band up to 312000 (2008-2009) is liable to inheritance tax at 40%. This figure is called "nil rate band" HM revenue and customs: rates and allowances (HMRC (HM Revenue & Customs). (n.d.). "Alternatively, it may be possible to pass on some of the assets on first death but enable your spouse to still have financial security after your death by using your will trust" (Money Minder, 2005).

You can use the nil rate band by making an effective will and in this way you can save 114,000 and control your own inheritance tax planning. I hope, you