Later Life Planning and Wealth Management
Statutory Wills and Gift Applications for those without Mental Capacity
A Will is an incredibly important document as it is a means by which someone can choose how they wish to arrange their affairs on death. Where a person lacks capacity, only the Court of Protection has the ability to effect a will. This type of document is referred to as a ‘Statutory Will.’
An application for a statutory will can be expensive and is likely to take a number of months, although, much quicker, emergency applications can be made in certain circumstances. The Court’s aim is to arrive at a document that it feels the ‘patient’ would have executed, had they the capacity to do so.
Unsurprisingly, any application must be supported by suitable, relevant evidence, (including medical). Other parties may support or oppose all or parts of the application, such as other family members. In addition, it is likely that the Court will appoint the Official Solicitor to represent the patient’s interests. The Court must be suitably convinced not only of the need for a will, but also on its appropriateness. Any application must always be in the patient’s best interests.
Attorneys and Deputies are not permitted to make gifts on behalf of an incapacitated person, unless they are of a seasonal nature and reasonable in relation to the size of the person’s estate. This is typically taken to mean birthday gifts or similar. Despite what many people believe, this does not extend to making annual gifts of £3,000 to reduce a person’s taxable estate.
Sometimes though, it is appropriate to make a gift, including to mitigate an inheritance tax liability. In such a case, the permission of the Court of Protection is required.
As with Statutory Wills, any application must be demonstrably in the patient’s best interests, taking into account that it is likely to take a number of months and will be an expensive process. That said, emergency applications can be made. An example would be a ‘death-bed gift’ to reduce the size of an estate sufficiently to take advantage of the Inheritance Tax Residence Nil Rate Band Relief, which is no longer available if the estate is too large.
If you have questions about making applications for a statutory will or for leave to make a gift, contact Richard Bates, who will be able to give full advice and assist any application on 01273 284012 or email firstname.lastname@example.org