Written by Claire Cox, Head of Inheritance Disputes, Hedges Law

Almost 1 million people in the UK are currently living with dementia. Most of us will know someone that has been affected by it, but a diagnosis can still come as a huge shock and be very worrying for an individual and their families. However, the law is there to protect you before and after a diagnosis, so it’s important to get advice about your future whatever the circumstances. 

You’re never too young to start planning

Before you have ever even thought about dementia is the best time to start planning for your future. You are never too young to get started. Around half of UK adults do not have a Will, and far less have an LPA (Lasting Power of Attorney) in place.

These important documents offer the best protection for you and your family. Anybody can create an LPA and everyone should have one. By preparing an LPA you will be the one who decides what happens and who can make decisions for you if you are no longer able to in the future. This person may need to make decisions about your property, finances and most importantly about your health and welfare, so you really want to decide who this person is yourself.

Dementia is often associated with older people, but more than 70,000 people in the UK living with dementia are under the age of 65. An LPA would offer protection in this scenario – and it’s worth noting that it would also protect you if you were to have an accident whilst driving, or on holiday – which could happen at any age. 

Sitting down and deciding what you want to happen in the future will provide you with certainty and security. Be proactive, be brave and take hold of your future by getting these documents sorted.

If you’ve been diagnosed with dementia

Recent research from the Alzheimer’s Society shows that 9 in 10 people living with dementia said getting a diagnosis had benefited them, so if you are concerned about someone, getting an early diagnosis is likely to help them.

A common misconception is that all doors close once a person is diagnosed and they are then unable to make decisions, make or update their Will, or put an LPA in place. But in reality, the law says that nobody can be considered to have lost their capacity for every decision, so it’s really important to engage with professionals, because the likelihood is, there will be things that can still be done to protect you or a loved one. Dementia has a huge range, and someone may still have the capacity to make a Will or an LPA and be capable of running their own affairs after a diagnosis. 

Assessing capacity is something that will need to be completed by a professional. Lawyers will often work with a capacity assessor, such as a GP or geriatric specialist to carry out those assessments and determine what decisions that person is still able to make for themselves. Your lawyer can then help to put all the protections in place based on this assessment. Don’t let a diagnosis be a barrier to making decisions about the future. The sooner you talk to an expert then the more they can help to get things in place.

It is often thought that following a dementia diagnosis, it is impossible to make or update a Will. This is in fact, incorrect, and a person can still be judged by a capacity assessor as having the capacity to make these decisions. When reviewing an existing Will, make sure it is still doing what you want it to do – are you still happy with the executors you have appointed and the beneficiaries you have named? Don’t forget, circumstances change and it is always a good idea to think about those you have named in your Will and if you need to alter anything to make sure your wishes are still able to be followed.

If the worst does happen and it is assessed by a professional that someone lacks capacity to make an LPA or a Will, it is more difficult but there are still things that can be done. At this point, someone can apply to be the person’s Deputy, often a family member if they are willing. A Deputy is appointed by the Court of Protection to look after a person’s affairs and this is usually limited to property and finances, not health and welfare.  

A Deputy has ongoing obligations to the Court and the costs of an application far exceed the costs of an LPA. It can take up to a year for a Deputy to be appointed. During this time the person’s assets will be frozen. Preparing an LPA in advance would avoid this, so this is always the best option if possible. In certain circumstances, if someone lacks capacity to make a Will, it is possible for one to be made on their behalf by the court. This is called a Statutory Will, but they are not common so you will need the help of a professional.

Why it’s important to prove capacity when writing a Will

As I’ve mentioned, you can still prepare a Will if you have been diagnosed with dementia but it’s important to ensure that capacity has been properly documented at the time of writing the Will, to protect the estate as far as possible from challenges after your death.

In practice, if there are any concerns in relation to capacity then a solicitor will usually recommend that a medical report is obtained from a capacity assessor. If this is not done, then the Will is more susceptible to challenge, and it would be a matter of fact for the Court to decide as to whether the deceased had capacity at the time.

The importance of regularly reviewing your Will (and LPAs) as relationships evolve and alongside major life events, cannot be understated. That way, if a loss of capacity occurs suddenly, due to dementia or otherwise, then your Will will be up to date at the time, and more likely to reflect your current wishes, helping to reduce the risk of family fallouts after your death.

If a challenge to a Will’s validity does arise, it is not unusual to see costs running into five figure sums. Similarly, if there is an intestacy which does not provide for a partner, because a Will was never prepared, the costs can be significant. Taking legal advice as early as possible is paramount and can save your loved ones a huge amount of time and money in the long run, simply by planning ahead wherever possible. 

Claire Cox is Head of Inheritance Disputes at Oxfordshire-based law firm, Hedges Law.

An experienced disputes lawyer, Claire studied law at Cardiff University and qualified as a solicitor in 2009. Claire specialises in inheritance disputes and contentious probate, include claims against estates, such as disputes between Executors or Trustees, estate administration issues, breach of trust, and claims around will validity, and has completed the ACTAPS qualification for lawyers specialising in contentious trust and probate work.

One day, we’re all going to die. It’s an unavoidable fact of life, and something that many of us would prefer not to think too hard about. However, the truth is that preparing for death can make things easier for both yourself and those who love you. By getting your affairs in order, you can save them from added stress, while also making sure your wishes are heard. 

If this is something you are currently thinking about, firstly, we hope you’re doing okay. Our therapy booking service is always there if you are going through a difficult time and need someone to talk to. We want to try and make end of life planning that little bit simpler for you or your loved one, which is why we’ve created this ‘getting your affairs in order’ checklist of practical tasks. 

A lot of these steps you can take on your own, but don’t be afraid to ask for help if you need it. This may actually be wise, as it will mean someone knows exactly what preparations you’ve made. The list might look long and daunting, but many of these things you’ll already have lying around somewhere. It’s just a case of finding them, getting them together, and sharing them with the right people.  

1. Write your last will and testament

The first practical thing many of us think about when preparing for a death is the will. This sets out what will happen to your estate and belongings when you die, who will carry out your wishes and, if you have children, who will look after them. You can write a simple will on your own or find templates on Google that you can fill in. Make sure, when you choose an executor, it is someone you trust to act fairly and do exactly as you ask. We then recommend contacting a solicitor to read over your will, provide any feedback, and ensure the final document is legally binding. This is something we at Untangle may be able to help you with, so do reach out if you’re looking for the right solicitor for you.  

 

2. Communicate your funeral wishes

If you know there is a certain song you want played or ritual carried out at your funeral, tell the person or people who would be responsible for planning the day. Maybe you want everyone to wear a certain colour, or there’s a reading you’d like them to listen to. Whatever your funeral wishes are, write them down and pass them on to someone you trust. This isn’t just for your own peace of mind; it’s helpful for your loved ones too. They won’t have to guess or wonder (or argue over!) what you might have wanted when the time comes. Dying Matters and the National Association of Funeral Directors have created a ‘My Funeral Wishes’ leaflet, which you can print out and fill in if you need some help with ideas.

 

3. Document all of your passwords

So much of our lives is stored on phones and computers these days, which means that, chances are, your loved ones will need access to your devices at some point. Note down all of your passwords – including any for online banking, bill paying, emails, etc. – or better yet, use a password managing service to store them all in one place. 1Password keeps them all together, and lets you share with friends and family in a few taps. It’s completely safe (with plenty of security measures in place), but makes it easy to give people the access they need. 

 

4. Share locations for important paperwork

Two of the most important documents you can share with your loved ones are your life insurance policy and your pension details – but these can often be overlooked while people focus on the will. So, make sure you gather them up and place them in one location in your home, then tell your loved ones where they can find all the paperwork they need. Other documents and financial details to add in are: 

Place them all in a clearly labelled folder to make things even simpler for the person looking for them.

 

5. Make a list of who needs to be told

Those closest to you will probably know who to contact after you’ve passed away, but if you have some old friends you think they might forget, make sure to write their names and numbers down. This can go in the same folder as your important documents – just make sure someone knows it’s there. 

 

6. Consider your social media accounts

There’s no denying that social media has become a big part of our lives, so you may want to have an end of life plan in place for your Instagram, Facebook and Twitter accounts. Perhaps you just want them removed entirely, or maybe you want someone to create a post for you. Whatever the case, this is another thing to share with those closest to you. In your Facebook settings, you can even choose a ‘legacy contact’ to look after your account after you pass away or request that your account is removed once someone confirms your death.  

 

7. Make sure your car isn’t parked on the road

Your car insurance policy becomes invalid as soon as you have passed away, so if your car is parked on a road, nobody will be legally able to move it. Start making sure it’s parked up properly so it can’t become a problem later on. 

 

8. Ensure the executor has enough money

It will be up to the executor of your will to gather money from your estate and pay off any debts and home bills that come through. However, they can only get money out of the estate when the grant of probate has been issued, which means they may need some funds up front to cover essential costs. Try to come to an arrangement that will ensure they have enough money to pay off those bills, as even the most straightforward estates can take months to process. Alternatively, the executor may be able to get help from a solicitor, who can contact creditors on their behalf and advise on how and when payment will be made. 

 

9. Arrange a home for your pet(s)

If you live with just your pet(s), you’ll want them to go to a loving home; somewhere you know they’ll be taken care of and given all the care and attention they deserve. Think carefully about who you would want to look after them after you have gone. Someone they already have a relationship with would be perfect, as they’re likely to settle in much quicker. You could also register for the RSPCA’s Home for Life, and they will arrange a home for your pet on your behalf. There’s paperwork involved here so, again, make sure your pet’s plan is kept with all your other documents. 

 

10. Check if there’s anything you want to get rid of

As well as things you’ll want to gather, there might be things you want to get rid of, too. That slightly embarrassing teenage journal comes to mind! This is just a friendly reminder to go through your belongings and check there’s nothing that makes you cringe too hard. (But don’t worry too much; the people who love you won’t judge those old ‘Dear Diary’ entries.)

You will need:

Things to note:

The application fee is £273 if the value of the estate is £5,000 or over. There is no application fee if the estate is under £5,000.

Extra copies of the grant of probate or letter of administration cost £1.50 each. It is worth getting a few copies – we would recommend one for each account you still have to close, so you are able to send them to different organisations at the same time. This should help you to complete the process faster.

How to apply for probate:

How to apply for letter of administration:

What’s next?

Last updated: 16/06/22

What is Inheritance Tax?

Inheritance Tax is a tax you have to pay upon inheriting the estate of someone who has died, including all of their property, possessions and money. It needs to be paid by the executor. Inheritance Tax must be paid or partially paid before probate or letter of administration can be granted, although there are some exceptions. Inheritance tax is sometimes referred to as Capital Gains tax.

What is the threshold for paying Inheritance Tax?

You will need to pay Inheritance Tax if the estate is valued at over £325,000. Usually, anything over this threshold is taxed at a rate of 40%. However, there are many exceptions to this.

For more information: gov.uk

There are many other possible assets that might need to be added to the value of the estate to comply with estate law. These include interests in trusts (which might have arisen on the earlier death of a spouse), transfers of value within the last 7 years, or gifts made at any time where the person who has died retained some kind of benefit in the asset given away,  An example of this might be putting a house in the name of children, but continuing to live there or visit on holiday.

Typically, no Inheritance Tax is due if:

You are obliged to file a report with HMRC even if there is no tax to pay. You can do this here: gov.uk

If you don’t need to pay Inheritance Tax, skip to Step 3: Applying for Probate or Letter of Administration

Where do you get the money to pay?

Banks or building societies may release money out of your loved one’s account before probate or letter of administration has been issued if it is being used to pay Inheritance Tax directly to HMRC. If you are paying Inheritance Tax on property, HMRC may accept staggered payments spread over a period of time. If you pay the Inheritance Tax out of your own money, you can get a refund from the estate once probate has been granted.

How to pay:

  1. Value your loved one’s estate (Step 1)
  2. Decide whether it is likely that you will need to pay any Inheritance Tax based on the information in Step 2
  3. Report the estimated value of the estate to HMRC (even if you will not need to pay Inheritance Tax)
  4. If you think you need to pay Inheritance Tax, apply for a reference number. This needs to happen at least three weeks before you make a payment.

Feeling a bit stuck?

Sometimes getting a professional to take over helps moves things along. We offer a range of solicitors who can help take away the pressure of dealing with estate law and wills.

Next Step: Applying for Probate or Letter of Administration

Managing wills and probate can be complicated, so here is a guide to the steps you will need to take – whether you are working with a solicitor or doing it yourself.

If your loved one had a will: You’ll need to apply for a grant of probate

The probate process: how long does probate take, and who can do it?

Obtaining a grant of probate allows you to access your loved one’s assets and distribute them in accordance with their will. The executor of the will should apply for probate within a few months of your loved one’s death, as it may be necessary to access and close certain accounts that your loved one held. The probate process can vary in length, but on average, administration takes 6-9 months.

You don’t need it if:

You are likely to need probate if any of these apply to you:

To find out the thresholds for probate, contact the account provider(s). If you do need to apply for grant of probate, follow the steps in our guide below:

Step 1 – Estimating the value of the estate

Step 2 – Do I need to pay Inheritance Tax?

Step 3 – Applying for probate and next steps

If your loved one didn’t have a will: You’ll need to apply for a letter of administration

What is letter of administration and who can do it?

Obtaining a letter of administration allows you to access your loved one’s assets and distribute them in accordance with their will. The executor of the will should apply for probate within a few months of your loved one’s death, as it may be necessary to access and close certain accounts that your loved one held.
In this situation, the person who deals with the estate is usually the deceased’s next-of-kin, such as a spouse or child. You should apply for a letter of administration within the first few months of your loved one’s death if you need to access or handle their accounts.

You don’t need it if:

You are likely to need a letter of administration if any of these apply to you:

To find out the thresholds for removing assets from your loved one’s accounts, contact the account provider(s). If you do need to apply for a letter of administration, follow the steps in our guide below:

Step 1 – Estimating the value of the estate

Step 2 – Do I need to pay Inheritance Tax?

Step 3 – Applying for a letter of administration and next steps

To meet others who share a similar experience of loss, as well as step-by-step guides to navigating the practical admin that comes after a loss, join the Untangle app.

One of the first administrative tasks is to notify the banks and building societies where your loved one held accounts. Most banks and building societies have a designated bereavement support customer service team, and they should explain the next steps to you once you’ve made the initial contact. The Death Notification Service covers most of the common banks and building societies in the UK – this is a useful tool to avoid having to contact multiple organisations.

Who can do this?

In most cases, the banks and building societies will need to speak to the executor of a will, or the next-of-kin/administrator if your loved one died without leaving a will.

When to do this?

This is one of the first tasks you’ll need to complete. Once you have a death certificate, contact the bank or building society so they can temporarily freeze any payment in or out of the account. Joint bank accounts can continue to be used as normal. Any funds in the account can be used to pay for the funeral and probate fees or Inheritance Tax, if applicable.

Introduction to the Death Notification Service

We recommend using the Death Notification Service to start the process of notifying financial organisations. This service allows you to inform several banks and building societies of your loved one’s death at the same time. You just have to fill out one form and it will notify all the providers for you.

The organisations that are covered include:

With new organisations being added regularly.

Using the Death Notification Service (DNS)

Step 1 – Gather the following details about your loved one:

Helpful, but not mandatory, details include: 

Step 2 – Visit the Death Notification Service website

Head to the DNS Website: Death Notification Service

Scroll down to the bottom of the page and click the yellow button that says ‘Submit Death Notification’ to begin. We recommend you create an account afterwards so you can add other accounts that you might have forgotten about at a later date.

Step 3 – Next steps

Within 10 working days, you should receive instructions of what to do next from each of the individual financial organisations. For example, you may need to provide a copy of the death certificate.

Contacting companies directly to notify them of a death

The following organisations are not covered by the Death Notification Service. We have included links to the customer support team on their websites, so you can find the information to contact them yourself:

When notifying a bank or building society, make sure you have the following information to hand: 

 

Last updated: 16/06/22

To meet others who share a similar experience of loss, as well as step-by-step guides to navigating the practical admin that comes after a loss, join the Untangle app.