sky

Guide to Making Bequests in a Will

All articles

Share it

1305249928

If you die without making a Will in the UK, your estate is shared out according to certain rules, called the intestacy rules. Under the intestacy rules, there is an order in which your loved one’s will inherit, which includes only married or civil partners and some other groups of relatives. As a last resort your whole estate will pass to the Crown.

If you wish to make provision for individuals and organisations, then it is essential that you have a Will prepared which can include bequests. In this guide, you will find out about the most common types of bequests and the right way to make a bequest in your Will.

What are bequests?

Writing a Will serves a number of purposes, one of the most important is to identify who you wish to leave your assets to after you die. The meaning of bequest is the act of giving away assets in your Will to individuals and/or organisation.

Bequests you can make in a Will can include giving away personal property. For example: jewellery, cars, money, ornaments to whoever you wish.

Bequest vs. inheritance

People often use the terms bequest and inheritance interchangeably. However, a bequest is an act of leaving something to another person and/or organisation through a Will. Inheritance describes the property received by someone from a person who has died, say following the death of a spouse or relative.

Types of bequests in a Will

There are several different types of bequests you can make in your Will. The most common are as follows:

Specific bequest

A specific bequest is the giving away of a specific item to someone and/or organisation named in your Will.

This might include for example an item of jewellery for your daughter or your collection of records for your sister.

Pecuniary bequest

A pecuniary bequest is the giving away of a specific amount of money to someone and/or organisation named in your Will. For example, you may wish to leave £500 to your friend or £500 to your chosen charity.

Conditional bequest

When making a specific or pecuniary bequest, a condition could be attached to receiving it. For example, you might choose to leave your car and £1,000.00 to your grandson if he survives you and reaches the age of 21. On attaining the age of 21, he then receives the car and £1,000.

Charitable bequest

A charitable bequest is the act of giving away in your Will to a Charity. For example, you could leave a specific or pecuniary bequest in your Will or even leave some or all of your residuary estate to charity.

Any provision made in your Will for a charity means such bequest will benefit from charity exemption.

Are bequests taxable in the UK?

It is not usual for anyone to pay income tax on bequests at the time they inherit them.

Residuary estate

The residuary estate is what remains of the estate of the person who has passed away after the payment of any debts, funeral and testamentary expenses and bequests have been made as referred to in the Will. For example, you may choose to leave the residue of your estate to be divided between certain individuals and/or organisations in equal shares or in percentages. Alternatively, you may wish to leave your entire residuary estate to one person or organisation.

How to make a bequest in your Will

When you’re making a Will, there are certain things you need to consider if you want to include any bequests. First, you’ll need to make a list of all your assets. Then you’ll need to decide who you want to include in your Will and what you wish to leave them. You will also have to decide whether the bequest is conditional. Finally, you will have to decide what happens to the bequest in case your chosen beneficiary passes away before you so that you can make provisions for a substitute beneficiary.

Bequest language example

If you’re wondering how to word a bequest, here is an example:

I give to my nephew Jack Smith of (insert address) free of all taxes and death duties the sum of £1,000.00 (One Thousand Pounds) subject to him surviving me and reaching 21 years of age and if this gift fails by substitution, I give this bequest to my friend Julie Wright of (insert address) absolutely.

When can bequests be deemed invalid?

There are situations in which a bequest can become invalid or fail.

Some examples can include:

  • A specific bequest you made to someone and/or organisation no longer belongs to you
  • If the intended recipient/beneficiary dies before the person who made the Will dies and there is no substitutional recipient/beneficiary names in the Will
  • If the intended recipient/beneficiary dies before a condition is satisfied after the death of the person who made the Will and there is no substitutional recipient/beneficiary named in the Will
  • Where the recipient/beneficiary disclaims the bequest
  • Accounts in joint names or property owned as joint tenants being bequeathed to a recipient/beneficiary who is not the other joint account holder or other joint tenant

In some cases, there can be exceptions to the bequest failing.

Why consider a Living Will?

A Last Will and Testament is critical if you want to ensure your assets are distributed to certain individuals and/or organisations after you pass away. However, you should also consider the preparation and registration of Lasting Powers of Attorney. There are two types of Lasting Powers of Attorney (LPA):

  • Propert and Financial Affairs
  • Health and Welfare

These LPAs allow you to give someone you trust the legal power to make decisions on your behalf whilst you are alive.

The decisions that someone can make on your behalf with a Property and Financial LPA can include decision relating to:

  • Dealing with investments
  • Buying and selling property
  • Bank, building society and other financial accounts
  • Paying your bills
  • Dealing with your pension and benefits

You can ask someone to act on your behalf when you do have mental capacity and when you do not have mental capacity to make decisions for yourself with this LPA.

The decisions that someone can make on your behalf with a Health and Welfare LPA can include decision relating to:

  • The type of care and medical treatment you receive
  • Your daily routine
  • Where you live
  • How you dress

You can only ask someone to act on your behalf when you do not have mental capacity to make decisions for yourself with this LPA.

There are several reasons why you should consider having LPAs prepared:

  • It gives you peace of mind that you have chosen people you trust to make decisions for you on your behalf
  • It helps to prevent major arguments between family members
  • It gives you control over medical treatment

Want to know more about how to make a bequest in a Will? See the most frequently asked questions about Wills.