Good value will service?
|Tax | Inheritance Tax
Asked by junevy, submitted
22 July 2011.
I and my husband are on the point of making a second will as the first one we made 25 or so years ago is now not fit for purpose. As there is so much choice for us in the world today, I do like to do a little research before making up my mind who I would like to give my business to.
Last week we attended a seminar called Universal Asset Protection which was very informative but the one thing I forgot to ask was if they were a regulated company. As you have been extremely helpful to me in the past, I thought you may be able to help me out on my query and have any advice you can give me in my quest to get a good price deal as some solicitors are charging extortionist fees!
I have also been quoted package deals which include:-
Will including Discretionary Will Trust,
Lasting Power of Attorney - property and affairs
Lasting Power of Attorney - health and welfare
Severance of Tenancy (Tennants in Common) if applicable
Letter of Wishes
The total price is £995 plus VAT for a couple.
Would you consider this as a good price for the package?
I look forward to hearing from you and once again, Justin, many thanks for your previous responses - most helpful - better than having a bank manager in your wardrobe!
Answered by Justin on 26 July 2011
The biggest rip-off when it comes to will writing is the companies concerned appointing themselves as executor of the will and subsequently charging extortionate fees to carry out these duties when you pass away. The executor's job is to ensure the correct amount of inheritance tax, if any, is paid and that everyone named in the will gets their share of your estate – a process called ‘probate'. In my view it's better to nominate a trusted relative or friend, who can either carry the task themselves or appoint a reasonably priced professional when the time comes.
Anyway, back to the present. Based on typical solicitor prices the amount being charged doesn't look horrendous, but equally it's not cheap. Universal Asset Protection's website contains little information, but I get the impression they're a marketing company that passes on the work to other professionals. As this inavariably involves sales commisison type arrangenments it might bloat costs, but hard for me to comment as I don't know their business.
Discretionary will trusts are less useful than they once were. These used to be popular to ensure that the first partner to pass away could use their full nil rate band (e.g. passing assets to children/grandchildren while ensuring the trust kept control), but rule changes in 2007 mean that any unused nil rate band on first death can now be passed to the surviving partner. Where discretionary will trusts can potentially still be worthwhile is if you want the flexibility to include as yet unknown beneficiaries (e.g. grandchildren not yet born), you're concerned that the value of assets will rise faster than the nil rate band after the first death or you want to remove assets from the estate over concerns the surviving spouse may have to use them to fund long term care (e.g. your home might be held as 'tenants in common').
However, bear in mind that if the value of assets placed into the discretionary exceeds the nil rate band a 20% 'lifetime chargeable transfer' tax will apply, followed by a further tax of 6% every 10 years.
Assuming you would benefit from such a will then the going rate for a straightforward scenario seems to be around £300-£600 inc VAT (for a couple).
Lasting Powers of Attorney can be helpful if concerned that you might one day be unable to make sensible decisions on your finances and welfare, perhaps due to suffering from Alzheimer's. Solicitors tend to charge around £100 - £200 per power of attorney (so £400+ to write each for both you and your husband).
But there's a further cost charged by the Office of the Public Guardian (OPG), the government department responsible for lasting powers of attorney, of £120 per power of attorney registered, so £480 in this instance. I doubt your quote includes this - it's good value if it does!
Tenancy in common tends to be a good thing (it means a husband or wife can pass their share of a property to beneficiaries on their death, making use of their nil rate and getting the assets out of the survivor's estate) so I'm not sure you'd want to sever any existing arrangements, but this will obviously depend on your situation and requirements.
Letters of wishes are not legal documents, but can be used to inform executors of your assets and any special wishes, e.g. burial/creation plans and how you'd like any trusts to be managed. There's little reason not to simply write this yourself, but a solicitor would typically charge £100+.
I'd also check whether the quote includes compulsory storage costs, as these can become significant over time. If you'd prefer not to keep a will at home (there's no reason not to provided you're confident it'll be safe) there are companies offering storage services from around £15 per year.
In terms of cheaper options, I recently stumbled across a company called Beneficient Law - interesting as they're run as a not-for-profit community interest company. I've not used them (so can't vouch for the quality of their work or service), but they seem to have favourable feedback on the web and charge very sensible fees. For example, their fee for two wills is £50 and £70 for two lasting powers of attorney.
Do any readers have experience of this company or feedback on will writing prices?