View more on these topics

Court of Appeal decision boosts case for trusts

Appeal-Court-High-Court-Building--700x450.jpg

A controversial Court of Appeal decision to overturn a will boosts the case for using trusts in estate planning, tax advisers say.

This week the Court of Appeal awarded £163,000 to Heather Ilott, the daughter of Melita Jackson who left her £486,000 net estate to three charities.

The daughter was estranged from her mother but judges ruled the mother-of-five’s income was “not reasonable” because she was on benefits and had no pension.

Despite a letter written by the deceased explaining the decision on beneficiaries, the court overruled the will.

The legislation cited in the case – the Inheritance (Provision for family and dependent) Act 1975 – only applies to the estate of a deceased and not to a trust.

Old Mutual Wealth financial planning expert Rachael Griffin says the case should be a “concern to all those who have made provision in their wills, favouring a beneficiary over another”.

She adds: “It highlights the benefits of making provision for handing down your estate during your lifetime through the use of trusts.”

Tax advice firm T&G director Mark Green says: “Clearly lifetime planning and use of trusts is a good starting point – they are much more difficult to overturn. The best thing to do with a will is leave detailed explanation but in this case it clearly wasn’t enough.

“There are no hard and fast rules but the more rationale you give the better. Interestingly, if you give a small provision in the will, it makes it harder for people to argue they should have a bigger share.”

Recommended

Pension-pot-700.jpg

Drawdown boost pushes LV= sales up 20%

Growing demand for drawdown has helped push LV=’s life and pension sales up 20 per cent in the first six months of the year. Sales of retirement products, including drawdown, annuities and flexible bonds, are up 15 per cent from £625m to £720m, the firm’s six-month trading statement shows. Sales of flexible bonds, an investment-linked […]

UK-Currency-Money-Notes-20-GBP-700x450.jpg
1

UK bank eyes entry into the mortgage market

Secure Trust Bank is considering an entry into the UK mortgage market. The Solihull-based lender says it has hired a team to explore the idea of entering the market. In its interim results, published last week, it said: “We remain open to the possibility of competing in the UK mortgage market and have hired a […]

Money-Cash-Coins-GBP-Pounds-UK-700x450.jpg

PFS Chelverton Equity fund tops Sanlam ‘White List’

The £364.2m PFS Chelverton Equity fund has taken the top position in the latest Sanlam White List. The wealth manager’s private investments income study ranks the 14 best performing UK equity income funds. The PFS fund, which is co-managed by David Horner and David Taylor and focuses on mid and smaller-cap companies, has outperfomed the wider market in […]

Retirement - thumbnail

Pension freedoms: stop the scams

At the beginning of 2015, we highlighted that the new pension freedoms that come fully online on 6 April also represent a very attractive opportunity for the criminal fraternity to scam savers out of some, or all, of their accumulated retirement savings.

Newsletter

News and expert analysis straight to your inbox

Sign up

Comments

There are 4 comments at the moment, we would love to hear your opinion too.

  1. A very strange ruling – judges making law. And by doing so stirring up things so that lawyers benefit from more disputes. However unpleasant mother may be, had she lived on the daughter would not have benefitted and I struggle to see how judges should overturn that wish whatever ones feelings are about it.

  2. tend to agree with you Sam Caunt. In this case it seemed pretty damned clear the mother did not want her daughter to benefit in any way.

  3. This is such a crucial and contraversial decision by the Court of Appeal I expect it will go to the Supreme Court. That will be interesting.

Leave a comment