Nobody wants their family to argue over their estate after their death. Unfortunately, every year, we see an increasing number of beneficiaries challenging the executor in estates, where they feel there has been an unacceptable distribution. These disputes are happening, more so where the deceased made a Will. There are instances of some family members turning their back on other family members due to a dispute over their inheritance. Besides being sad, any dispute over an inheritance can be expensive and time-consuming. 

For these reasons, you must let your beneficiaries know what they will inherit.

Explain how you arrived at your decisions in your Will

When you discuss your Will with your family and others, explaining the approach you took when drawing up your Will is essential. This is especially important when you have decided on an uneven distribution of your estate amongst family members. There may be one child who is not as prosperous as others, so you’ve decided to leave them more in the estate.

Making decisions on who should receive what share in your estate when you live in a blended family and have children from an earlier relationship can be particularly challenging.

Rather than depend on the law of intestacy, where you don’t make a Will, the best course of action is to create one. When you don’t make a Will, your estate will be distributed according to the law of intestacy, and it may result in those you love not receiving what you thought they would.

When you make a Will, you can direct how your estate should be shared after your death. Also, thinking about how you would like your estate distributed focuses on who should receive a share in your estate.

If your estate is at a level that may be subject to Inheritance Tax (IHT), making a Will allows you to mitigate against IHT.

When you think about how you wish to distribute your estate, it prepares you to discuss your Will with your family.

Setting the expectations for your beneficiaries

Preparing and signing your Will before speaking with family members is essential. By doing so, there is less chance that you will be influenced by anything they might say when you talk with them.

Arrange to speak with your beneficiaries individually or in groups and explain how you’ve decided to deal with your estate.

Suppose you have a substantial estate and have decided to spend large amounts of money. In that case, it is essential to set the expectation of your beneficiaries that the estate they will inherit might not be as large as they think. Some beneficiaries might depend on their inheritance to help them buy a house or pay off their mortgage. They might be shocked to discover their share of the estate is insufficient to enable them to do this!

Explaining your intentions limits your beneficiary's scope to complain about how much they’ll receive.

Living in a blended family can be tricky to deal with, especially when there are natural and stepchildren involved. You need to work out how to approach this, especially if your stepchildren are not to receive a share of your estate.

If you have a child who is disabled or has special needs and wish to make an uneven distribution of your estate favouring that child, it is essential to explain your reasons to your other children.

Explaining the distribution in terms of percentage shares

You do not need to go into the specific numbers when you explain how you wish your estate to be distributed. Rather than mentioning specific numbers, you can tell your beneficiaries that you will leave them specific items of a percentage of your estate. If you approach it this way, you are not tied down to particular figures you need to leave to certain beneficiaries.

You need to consider Inheritance Tax implications

When considering who should share in your estate, you must be conscious that HMRC may also be entitled to share in your estate through Inheritance Tax.

Before you make your Will, list your property, assets, investments, and debts. By doing so, you will be able to work out the net value of your estate. Based on that figure, the Inheritance Tax will be calculated.

Once you’ve considered any IHT exemptions, you might be able to reduce or eliminate Inheritance Tax. You may decide on some lifetime distributions that would, effectively accelerate the shares your beneficiaries receive from you during your lifetime, for instance, by way of gifts.

Carry out this exercise also allows you to explain to your beneficiaries why your estate may be reduced from the level they had expected it to be.

Discussing your Will with your beneficiaries helps avoid post-death disputes

When you discuss the distribution of your estate with your beneficiaries, it is likely to save disputes after your death. Your beneficiaries should hear it from you rather than trying to piece together your reasons after you’ve passed away.

When you speak to your beneficiaries about sharing in your estate, it allows you to set expectations.

If you explain the reasons for what is included in your Will, whilst some of your beneficiaries might not like those reasons, it reduces the scope of disputes and arguments after your death.

Experienced Wills and Estates Solicitors, North Berwick and Dunbar, East Lothian

Our solicitors have years of experience advising clients on preparing their Wills and dealing with their estates in North Berwick and Dunbar, throughout East Lothian and across Scotland. We will discuss all aspects of your estate distribution and whether there are IHT issues.

If you would like to make your Will or update an existing Will, please get in touch with us.