We all know that we should make a will, yet figures released in 2018 by Unbiased show that a staggering 60% of UK adults (approximately 31 million people) don’t have a will. Reasons given for not making a will include “I’ll do it when I’m older”, “I don’t want to think about my death” and “I don’t need a will”.
This article explains what a will is, why it’s important to have one and the process of making a will as a contractor.
Why having a will as a contractor is important
A will is a legal document that sets out what you want to happen to your estate and who will be reasonable for the care of any dependents after your death. If you die without making a will you will be deemed as being intestate and your estate will be distributed according to the intestacy rules.
There can be confusion over whether your partner will automatically inherit your estate. The law states that if you are not married or in a civil partnership your partner has no right to inherit your estate. Only, by having a will stating that you wish for them to inherit, can your estate be passed on to them.
Another important reason to have a will is it can help reduce the Inheritance Tax that is due on the estate. Currently, Inheritance Tax is charged at 40% on the proportion of the estate that it is above the Inheritance Tax threshold (currently £325,000). With careful estate planning, you may be able to reduce the amount of Inheritance Tax that is due.
Steps involved in making a will
The following is a summarised version of the steps that is involved in making a will as a contractor:
Value your estate
A simple method is to calculate the value of your assets (including things like property, savings, life insurance, investments, pensions, jewellery, antiques etc) and minus your debts (such as mortgage, credit card balances, overdrafts, loans etc)
Decide who gets what
Be very clear on what happens to your estate. Some things to think about include; who receives what, if you want to leave money or property to charity, what happens if a beneficiary passes away before you
Choose your executors
It’s not what you think! An executor of a will is a person who is responsible for distributing your estate after your death. Depending on the complexity of your will, being an executor can be a lot of work. So, take some time to choose someone who you can trust to do it properly
Write your will
There are several ways to write a will. You could choose to do it yourself (although it can be costly if you make a mistake) or get a professional like a lawyer to write it for you. Other institutions like charities and banks sometimes offer a will writing service as well
Sign the will
For your will to be valid you must sign the will in the presence of two independent witnesses who must also sign it in your presence. If a mistake is made during this process, the will becomes invalid
Review your will regularly
It’s recommended that you review your will every three to five years as your personal circumstances may have changed in that time
As detailed above it’s relatively simple making a will, so if you haven’t made one, think about doing it soon. If you’re not sure where to start we’d be happy to recommend some experienced professionals who can help you with it. Give us a call on 01962 867550 or send us a message via our website.