Understanding Will Terminology – Will Jargon Explained
When it comes to sorting out a Will, there’s a lot of jargon to make sense of. Our Wills glossary helps you understand Will terminology.
Administration: The administration of an estate is the finalisation of someone’s financial affairs after their death. Also known as the winding up of an estate, it involves selling assets, paying all bills, preparing estate accounts and distributing the estate to the Beneficiaries.
Administrator: An Administrator is a person appointed to deal with the winding up of an estate when the deceased did not leave a Will.
Assets: Assets are any items of value owned by the deceased, such as cash, savings, investments and property.
Attestation: This is the signing and witnessing of a Will, which must be done in strict compliance with legal rules in order for the document to be valid.
Beneficiary: Someone who will receive something from the deceased’s estate after their death, either because they have been named in the Will or because they are entitled to inherit under the Rules of Intestacy (see below).
Bequest: A gift left to someone in a Will.
Chattels: Personal possessions other than land, money or securities. This includes the contents of the home, such as furniture, art, garden items and jewellery, as well as other possessions, such as vehicles and pets.
Codicil: An addition to a Will making minor changes. Significant changes should always be dealt with by creating a new Will wherever possible.
Crown: If someone dies without making a Will and no one is entitled to inherit under the Rules of Intestacy (see below), their estate will pass to the Crown. In reality, the government’s Treasury Solicitor will take charge of the assets and deal with the estate administration.
Deed of Variation: A Will can be changed after someone’s death by way of a Deed of Variation. Anyone who would be affected by this change needs to consent to the deed being made. There are sometimes financial advantages in executing a Deed of Variation, for example, to legitimately reduce the amount of Inheritance Tax that might be payable in respect of the deceased’s estate or a Beneficiary’s estate.
Estate: Everything owned by the deceased at the date of their death. The net estate refers to what is owned minus any debts and liabilities that must be paid.
Executor: An Executor is appointed in a Will to administer the estate. You can have one or more Executors and appoint a substitute to ensure your estate is not left without an Executor.
Grant of Letters of Administration: This legal document gives an Administrator authority to manage an estate where the deceased did not leave a Will.
Grant of Probate: The legal document giving authority to an Executor to deal with the winding up of an estate in accordance with the deceased’s Will. Obtaining a Grant of Probate may not be necessary where an estate is small, and the deceased did not leave any property.
Guardian: Guardians are appointed in a Will to look after minor children or children who cannot manage their own affairs. Without this provision in a Will, the court will decide whom your children will live with.
Inheritance Tax: This is a tax payable after death and calculated with reference to the value of the net estate. The rate is usually 40%, payable on the part of the estate that exceeds £325,000, although there are some allowances available. Inheritance Tax is a complex subject, and help from a legal expert can often mean you can legitimately reduce your estate’s Inheritance Tax liability.
Intestate: If someone dies without making a Will, they are said to have died Intestate. Their estate will pass under the Rules of Intestacy (see below).
Issue: This refers to children, grandchildren, great-grandchildren, etc.
Legacy: A legacy is a specified gift left to someone in a Will. Legacies are paid out first before the residue is distributed.
Life interest: This is the use of an asset for the period of someone’s life. For example, they could be left a life interest in a property so they can live there for as long as they want.
Nil Rate Band: The Nil Rate Band is the part of a net estate on which no Inheritance Tax is payable. Currently, the Nil Rate Band is the first £325,000 of the net estate.
Personal representative: This refers to the person legally authorised to deal with the administration of an estate, either an Administrator, where there is no Will or an Executor.
Probate: This is often used as a general term to refer to the winding up of an estate. It can also refer to the actual legal document usually needed to deal with an estate administration, the Grant of Probate.
Probate Registry: The Probate Registry is the office responsible for issuing Grants of Probate and Grants of Letters of Administration.
Residuary gift: This is a gift of the residue of the estate or a share in the residue of the estate.
Residue: The residue refers to the part of the estate that remains when all debts have been paid, including Inheritance Tax and funeral expenses, and all specific gifts have been made.
Rules of Intestacy: These rules govern who will inherit the estate of someone who has not left a Will. Only a spouse or civil partner and other close relatives can inherit under the Rules.
Specific gift: This type of gift is a specific item or set sum of money left to someone in a Will, for example, a particular piece of jewellery or £5,000. Specific gifts are paid out in priority to the residue of the estate.
Testator: This refers to the person who made the Will.
Trust: Some or all of your assets can be left in Trust for your Beneficiaries. This means that a Trustee will look after the assets and provide their benefit to the Beneficiaries in accordance with the Testator’s wishes. For example, a Trust could be used to look after assets for minor children until they are old enough to inherit.
Trustees: Trustees can be appointed in a Will to administer a Trust.
Witness: A Will must be witnessed by two witnesses, who will also need to sign the Will. They should not be Beneficiaries under the terms of the Will or related or married to Beneficiaries, or the gift to them will fail.
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Understanding Will terminology is a big help when writing your Will. If you would like some expert advice, please feel free to get in touch.
Our lawyers have extensive experience in drafting Wills that pass on assets to Beneficiaries in the most tax-efficient way possible. Speak to one of our specialist Wills and Probate lawyers by calling 0117 952 0698 or contact us online, and we will be pleased to help.
