This is a very important aspect of financial planning, yet clients are often reluctant to address it for reasons that are easy to understand. Writing a Will should be very straightforward and need not be expensive.

This should be a very simple and straightforward planning exercise as it really only deals with how an estate should be distributed on death. Those clients that do not plan, run the risk that some or all of their estate on their death will be paid to relatives they might have chosen not to receive it.

At the same time as ensuring that funds are received by the right people on death, estate planning also provides the opportunity to distribute assets tax efficiently.

Inheritance tax (IHT), the tax levied on all our estates on death is charged at 40% on any value in excess of the IHT nil rate band of currently £325,000. It is therefore a straightforward calculation to establish the tax that will be due on death. Married couples or those in a Civil Partnership are able to utilise their partner’s nil rate band as well thereby sheltering the first £650,000 from tax.

It is important also to check that any life assurance policies have been established efficiently as failure to do so could result in 40% of the policy sum assured being lost to IHT.