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Glossary

Terms in italics are defined elsewhere within the Glossary.

Absolute – in the context of gifts in your Will, without condition or restriction.

Ademption – where you sell, or dispose of, the subject matter of a specific legacy during your lifetime.

Administrator – a person appointed to deal with your estate should you die intestate or without naming a valid executor.

Advance decision, advance directive – an indication of your wish to refuse all or some forms of medical treatment if you lose mental capacity in the future. More about advance decisions

Advancement – a payment or a distribution to a beneficiary of a part of his/her share of capital before the time fixed for his/her receiving an absolute interest in possession.

Aggregation – the adding together of all property (with certain exceptions) which passes, or is deemed to pass, on your death in order to determine the rate of Inheritance Tax.

Appropriation – the application of property, eg for or towards the satisfaction of a legacy or annuity.

Assent – the transfer of property to a beneficiary or trustee by the executors.

Assets – everything that you own. This can include property, land, shares and cash.

Attestation clause – the statement in a Will before the signatures verifying that both the Testator and witnesses are present at the signing.

Attorney – the person you entrust with the management of your affairs under a Lasting Power of Attorney or an Enduring Power of Attorney.

Beneficiary, beneficiaries – the people or charities who will receive something in your Will.

Bequest – a gift of money, or an item of personal property, which is left in your Will.

Bloodline planning – a generic term applied to estate planning strategies which are designed to maximise the legacies you leave to your children and grandchildren, protecting them from the consequences of divorce (yours or theirs), re-marriage (yours or theirs), bankruptcy or liability for care fees.

Bona vacantia – ownerless property that passes to the Crown, or the Duchy of Cornwall or Lancaster.

Capacity – being of sound mind and of the requisite age to make a Will or a Lasting Power of Attorney.

Class gifts – a gift made to a class of people by reference to their relationship to you. Persons included in a class must be ascertainable. Particular care should be used when making class gifts to relatives, dependants, friends, colleagues and unincorporated bodies such as sports or social clubs.

Codicil – a testamentary document which alters or amends your Will.

Commorientes – where two people die together in circumstances where it is impossible to tell who died first. The usual presumption is that the elder died first unless the Will includes a survivorship clause.

Contingent legacy – a legacy that transfers no interest at all unless a specified but uncertain event happens.

Court of Protection (CoP) – the specialist Court for issues relating to people who lack capacity to make specific decisions.

Deed of Variation – a document, which must be executed within two years of your death, which varies the distribution of your estate from that set out in your Will or specified on intestacy. Normally executed to take account of post death variations in circumstances or to mitigate Inheritance Tax.

Demonstrative legacy – a pecuniary legacy paid out of a specific fund.

Deputy – an individual appointed by the Court of Protection with ongoing legal authority as prescribed by the CoP to make decisions on behalf of a person who lacks mental capacity and has not signed an Enduring or Lasting Power of Attorney.

Devise – a gift of real property or land in your Will.

Disclaimer – rejection of a gift in your Will by a beneficiary.

Discretionary trust – a trust whose fund is distributed among two or more beneficiaries at the discretion of the trustees who may decide to whom, when, and how much (if any) to distribute. May be accompanied by a letter or memorandum of wishes which may give guidance to, but not bind, the trustees.

Donatio mortis causa – a gift you may make if you are about to die, on the understanding that if you do not, the gift is void.

Domicile – the legal system under which your Will is to be interpreted and administered. For most people their residence and domicile are the same as the country in which they live. However if you or your parents were born outside England and Wales, or you intend to live permanently outside England and Wales you should consider taking legal advice.

Donor – the person making the Lasting (or Enduring) Power of Attorney.

Enduring Power of Attorney (EPA) – a document signed by a person (the donor) before they lose their mental capacity which appoints someone (the attorney) to deal with their financial affairs should they lose their mental capacity. Once you have lost your mental capacity, your attorney can only take over once the EPA has been registered with the OPG. EPAs were replaced by Lasting Powers of Attorney on 1 October 2007, but may still be registered and used.

En ventre sa mere – a French expression for ‘a child in the womb’. The expression is used in Wills where the you wish to include a child that has been conceived, but not yet born, as a beneficiary.

Estate – everything which belongs to you at the time of your death.

Execution – the formal signing and witnessing procedure, by you and two independent witnesses, which renders a Will valid.

Executor(s) / executrix (executrices) – the male / female individual(s) appointed by you and named in your Will to administer the estate in accordance with the Will. More about executors

Gift with a reservation of benefit – where you give away an asset in your lifetime but still receive a benefit – for example, giving the family home to your children but continuing to live in it. This may have particular Inheritance Tax consequences.

Grant of Representation – a document issued by the Probate Registry giving a specified person authority to deal with your estate after you have died.

Guardian – the person appointed in a Will to look after and bring up your children, if there is no one else with parental responsibility for those children. More about guardians

Health and Welfare Lasting Power of Attorney – a Lasting Power of Attorney covering decisions about both health and personal welfare, such as where to live, day-to-day care or having medical treatment.

HMRC – Her Majesty’s Revenue and Customs.

Immediately chargeable transfer – a lifetime gift you make into a discretionary trust upon which Inheritance Tax of 20% is immediately charged and on which the remaining 20% Inheritance Tax will be payable should you die within seven years of the transfer.

Incorporation – making a separate, possibly unexecuted, document left with your Will form part of the Will. In order for a document to be validly incorporated, the Will must refer to it expressly, with certainty and state that it was in existence when the Will was executed, and it must dispose of some or all of your estate.

Inter vivos – if you create a trust during your lifetime other than in your Will, the trust is said to be an inter vivos trust.

Intestate – adjective: without a valid Will; noun: an individual who dies without making a valid Will.

Intestacy – the act of dying without having made a valid Will.

Issue – your children, grandchildren, great-grandchildren and so on.

Joint and several liability – where two or more persons enter into an obligation, each is liable individually and they are all liable jointly. For example, one or more can be sued as individuals and they can also be sued jointly.

Joint tenancy – the ownership of land by more than one person; on the death of one joint owner the land passes to the survivor(s). When only one survives he/she takes the land and can then dispose of it by Will.

Jurisdiction – the district or limits within which the judgments or orders of a court can be enforced or executed.

Lapsed gift – a gift in a Will which has failed (because the donee has predeceased the testator, dissolved, or cannot be identified).

Lasting Power of Attorney (LPA) – a document you create before you lose mental capacity which appoints an attorney to deal with your affairs should you lose mental capacity. LPAs must be registered with the OPG before they can be used and this can be done at any time. A property and finance LPA, once registered, can be used before mental capacity is lost, but a health and welfare LPA, once registered, may only be used once mental capacity has been lost. More about Lasting Powers of Attorney

Legacy – a gift of your personal property by your Will.

Letters of Administration – the Grant of Representation issued by the Probate Registry if you die intestate. Issued to your next of kin.

Life Interest – a beneficiary‘s entitlement under a trust to the income produced by the trust fund during the beneficiary’s lifetime.

Life tenant – beneficiary under a trust creating a life interest.

Living Will – see Advance Directive.

Minor – an individual under the age of 18 years (in England and Wales).

Mirror Wills – a pair of Wills in almost identical terms. Many spouses/partners have mirror Wills in which they leave their estate to the same ultimate beneficiaries named in both Wills who would benefit on the death of the surviving spouse/partner. The survivor can however still change the terms of his/her Will.

Nearest relative – under the Mental Health Act 2005, the order of precedence is: Husband or Wife; Son or Daughter; Father or Mother; Brother or Sister; Grandparent; Grandchild; Uncle or Aunt; Nephew or Niece.

Next of kin – although there is no legal definition (see nearest relative), this is generally understood by healthcare professionals to refer to a husband, wife or close blood relative who should be contacted in case of emergency.

Nil rate band (NRB) – the amount that HMRC allows you to pass on to those other than your spouse/registered civil partner without Inheritance Tax being payable upon it.

Nil rate band discretionary trust – a trust which gives your trustees discretion over when, and to whom, they distribute the nil rate band portion of your estate. A common form of Inheritance Tax mitigation for unmarried couples.

Office of the Public Guardian (OPG) – a department of the Ministry of Justice which deals with the affairs of the mentally incapable in conjunction with the Court of Protection.

Parental responsibility – all the rights, duties, powers, responsibilities and authority which by law a parent has in relation to the child and his/her property.

Partial intestacy – where a valid Will has been executed by you which does not dispose of the whole of your estate. Avoidable by proper Will drafting and estate planning.

Patient of the Court – an individual who, by virtue of his/her mental incapacity, is incapable of managing his/her own affairs.

Pecuniary legacy – a gift of money in your Will of a specific amount.

Personal chattels – all your household furniture and personal effects, except goods used for business purposes, money, bank balances or securities for money.

Personal representatives – a generic term for Administrators and Trustees.

Per stirpes – literally “by the root”; a gift to a child or other issue which lapses for any reason will pass down to the issue of that beneficiary. A statutory presumption, unless the Will states otherwise.

Pilot Trust – a trust created during your lifetime to receive assets on your death, useful for Inheritance Tax planning.

Probate – The process, after your death, by which your affairs are settled and your Will is validated. Your Executor obtains a Grant of Probate before they can distribute your estate according to your instructions.

Property and Finance Lasting Power of Attorney – a Lasting Power of Attorney, covering decisions about your property and financial affairs, including paying your bills, collecting your benefits, selling your house or managing your investments.

Protective Property Trust – A stipulation that, upon your death, your share of the property is put in trust allowing your spouse or partner to continue to live in the property for their lifetime. On their death the property would be given to your children or other beneficiaries.

Potentially exempt transfer (PET) – a lifetime gift which would be subject to Inheritance Tax if you do not live for seven years after the date of the transfer.

Public Trustee – an officer appointed by the Lord Chancellor to act as a custodian trustee.

Reading over clause – an attestation clause, required if your signature is shaky, erratic or feeble, which enables the witnesses to your Will to confirm that you understood and approved the contents of that Will.

Realty – freehold land, immovable property.

Remainderman – the person who takes the capital of an estate on the death of the life tenant.

Residuary estate, residue – the balance of your estate after all debts, taxes and specific gifts have been paid.

Reversionary interest – any right to the ownership of property at a future date.

Revoke, revocation – cancelling a Will.

Settlement – an arrangement by which property is held in trust, generally for several beneficiaries in succession, some of them unborn at the time of making the settlement.

Settlor – the individual making a settlement.

Severance of joint tenancy – the conversion of an equitable joint tenancy in land into a tenancy in common.

Survivorship – where a jointly held asset passes automatically to the surviving joint owner/s on death.

Survivorship clause – a Will clause which states that, in order for someone to inherit or act as executor, they must survive the testator for a stated time period.

Taper relief – when a potentially exempt transfer (PET) is made, the amount of Inheritance Tax which would be charged upon it should you die reduces, once three years has elapsed, by 20% per year until the gift is free of Inheritance Tax if the donor survives seven years after the date of the gift.

Tenancy in common – a way for more than one owner to hold property in distinct shares. Each tenant in common owns his/her own share and may dispose of it freely in his/her Will or during his/her lifetime.

Testamentary – legally disposing of personal property on death.

Testamentary expenses – the expenses incurred in obtaining probate or letters of administration, paying Inheritance Tax and debts, and realising assets.

Testate – dying leaving a valid Will.

Trust – a legal arrangement where a person (the Trustee) holds an asset for the benefit of another (the Beneficiary). Read more about trusts

Trust corporation – the Public Trustee or a corporation appointed by the court to act as a custodian trustee.

Trustee – the legal owner of trust property who holds it for the beneficiary.

Vested interest – having a current interest in an estate at the time of death of the testator/intestate.

Will – any valid written declaration of your intentions as to property, which you can dispose of after your death, which you require to be performed after your death.

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