Where there's a will, there's a way

In a bid to encourage people to make a will, a month-long charity-sponsored initiative is offering free wills to the over-55s, writes CAROLINE MADDEN

ASSET VALUES have fallen sharply since the credit crunch struck. But even if your net worth has shrunk, it is as important as ever to ensure your loved ones are properly provided for after you’re gone by making a will.

Wills normally rank right up there with pension planning and tax returns when it comes to nasty financial tasks that tend to languish indefinitely on people’s to-do lists. However, thanks to Free Wills Month Ireland, procrastinators now have a strong incentive to put their affairs in order.

This charity-sponsored initiative offers members of the public aged 55 and over the opportunity to have their will written – or updated – free of charge by participating solicitors’ firms. The solicitors are based in Dublin, Cork, Galway, Waterford and Wexford and contact details are available on www.freewillsireland.com.

In the case of couples making “mirror” wills – ie two separate but identical wills – only one person must have reached 55 to avail of the service.

Time is ticking, however. Anyone who wishes to take up the offer must contact one of the participating solicitors by next Thursday, April 30th, to make an appointment.

The appointment itself can take place after April 30th.

Free Wills Month is sponsored by seven charities: Age Action Ireland; the Children’s Medical Research Foundation; the Irish Heart Foundation; the Irish Hospice Foundation; the MS Society Ireland; Oxfam Ireland; and the Royal National Lifeboat Institution (RNLI).

The thinking behind the initiative is that participants may choose to leave a gift for their charity of choice when writing their will, although there is no pressure to do so.

But why bother making a will in the first place? Is it really necessary? That depends on your situation. For footloose, carefree single people with few assets to their name, it’s hardly a priority. But once an individual acquires assets, gets married or has children, it’s time to put their affairs in order.

The Free Legal Advice Centres (Flac) says a will is a way of safeguarding the future of those you care for.

“When you die, your affairs must be wound up. There are likely to be outstanding bills to be paid, as well as property which needs to be distributed,” it advises. “Making a will simplifies all of this and allows you to decide who gets what, with minimum delay and hassle.”

If, on the other hand, you die intestate, ie before making a will, the law dictates how your property is distributed.

Under the laws of intestacy, a deceased person’s spouse receives two-thirds of their estate, and their children inherit the remainder. If they do not have children, the surviving spouse inherits the whole estate.

While this may seem reasonable to some, others might prefer to have a say in how their assets are distributed after their death. By making a will, an individual can specify how their estate should be divided up and who should inherit which assets.

However, Dublin-based solicitor Mary Bradley, who is participating in the free wills initiative, advises people to consider their obligations to spouses and children. Even if an individual specifies otherwise in their will, their spouse has a legal right to half of their estate if there are no children, and one-third if they have children.

Under succession law, parents also have an obligation to provide for their children. For example, if all the children in a family received a good education except for one, that child may be entitled to make a claim for additional provision.

“It would depend on whether they took advantage of opportunities offered or not . . . but that would be a classic situation,” Bradley says.

Another issue that people are not always aware of is that marriage revokes a will, unless it was made with the marriage in mind.

Bradley says that, in recent years, many young people bought houses while unmarried and may have made a will at that point. If they subsequently marry, they may not realise that they should make a new will at this point. It is particularly important for people who have a young family to ensure they have an up-to-date will in place to protect their children’s interests.

Bradley says that, if both parents die intestate, the children inherit the estate, but the nearest relative will probably become responsible for administering the estate rather than somebody appointed to do so in a will.

“Your nearest relative may not be the person you’re closest to, or even the person you would choose to look after the children’s money,” she says.

Writing a will becomes considerably more complex if, as sometimes happens, an individual wants to ensure a particular person has no claim on their estate.

“Sometimes people are adamant that there is someone they do not want to inherit [from them] at all,” Bradley says.

This person is normally the spouse of one of their children. The idea, she says, is that they do not want that person to end up benefiting in the event of marital breakdown.

Foreign property can be a minefield in terms of ensuring that it is distributed in accordance with the owner’s wishes after their death, as succession law varies from one jurisdiction to the next.

In general, the best course of action is to get another will drawn up by a local lawyer in the country where the property is situated, rather than try to incorporate the overseas property into an Irish will.

In the emergency Budget earlier this month, the rate of capital acquisitions tax which applies to gifts and inheritance was increased to 25 per cent and the relevant exemption thresholds were reduced by 20 per cent.

However, Bradley says people are “less and less” worried about inheritance tax as property values fall.

“At the same time,” she adds, “you can still have quite modest houses that would be taxable in cases where you’re leaving property to brothers and sisters if you don’t have any children.”

However, by making a will, Bradley says it is possible to spread the distribution of property “around the family” to minimise potential inheritance tax liabilities.