Making A WILL

 

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It is not obligatory by law to prepare a Will for yourself and it is an easy task to put off.  However, many problems can arise if you die without leaving a valid Will. By making a Will it should avoid a lot of family squabbles and stress for those you leave behind. If you do not make a Will, your estate i.e. anything you owned at the time of your death will automatically come under Spanish law.

If you have a partner and are not married or in a civil partnership, you will not be able to inherit from each other unless you have a will.

Everyone has an inheritance tax allowance, making a will can ensure you maximise your taxation allowances, tax advice should be sort in this instance.

For the will to be legally valid you must have been over the age of 18, it must have been made of your own free will and you must have been of sound mind and body at the time. It has to be done in writing and signed and dated by the person making the will and by two other witnesses to that signature. A very important point about the signature, is that neither the witness, witnesses wife or partner will be able to inherit any part of your estate


Updating your will

You should review your will every 5 years and after any major change in your life, eg:

  • getting separated, married or divorced
  • having a child
  • moving house
  • if the executor named in the will dies

Making changes to your will

You can’t amend your will after it’s been signed and witnessed. The only way you can change a will is by making an official alteration called a codicil.

You must sign a codicil and get it witnessed in the same way as witnessing a will.

There’s no limit on how many codicils you can add to a will.

 

Other things you need to consider

  • Laws affecting your will
  • Deciding who inherits
  • Inheritance Tax  
  • Appointing Legal Guardians for your children
  • Setting up Trusts for children
  • Charity Donations
  • Funeral Arrangements
  • Problems for those left behind
  • Laws of Intestacy

 

Laws affecting your Will

You can choose to do your WILL so that either the Laws from The United Kingdom/England apply or Spanish Law applies.  Most British expats will prefer to be governed by English law simply because it will be easier for you to understand. 

 

Deciding who Inherits

If you do not have a Will the government will decide who inherits your possessions, property and money.  Under English law, who inherits your estate will be decided by the Law of Intestacy (1925) and as you can imagine they are unlikely to divide your assets in the way you would choose.  Under the Law of Intestacy if you are unmarried and have no close relatives your Estate will automatically pass to the Crown (government) if there is no valid Will in place.  Under Spanish law, if you cannot pay for any taxes that are due you cannot sell the assets, so again the assets will pass to the government.

By making a Will you can decide exactly who gets which assets and how much.  This could be anything from personal belongings to pets or property.  You will also help avoid unnecessary arguments amongst family members or relatives that invariably arise when a deceased person's wishes are unclear.

 

Inheritance Tax

Inheritance tax is the tax you pay on your estate.  In simple terms this is everything that you own at the time of your death, once you have taken away anything that you owe.

Writing a Will allows you to greatly reduce the amount of inheritance tax you pay or even eliminate it altogether.  Certain things can be given to particular people and organisations without inheritance tax being charged on them.  This then allows you to provide more money for the people you want to receive it rather than paying it to the taxman.

 

Appointing legal guardians for your children

If you have children who are below the legal age to live alone, preparing a Will is especially important.  In your Will you can appoint guardians to care for your children in the event of your death.  If you fail to do so the authorities will do so on your behalf, in the way they see fit.  However, they may not choose the people you would have chosen to care for your children.  This can be distressing for the children, as well as other family members, at a particularly difficult time.  In some situations, this could mean that a partner (who you are not married to) is not granted guardianship, even though they are the natural parent.

Most people choose to appoint a family member as a guardian for their children, especially if the children are very young.  With older children who have not yet reached eighteen, friends who live close by and share a similar lifestyle to your family are often appointed as guardians.  It is recommended to appoint two guardians in your Will, who are partners and live together, as this will provide your children with a settled family environment at a very difficult time.  If circumstances change then the guardians can be omitted from the Will and new guardians can be appointed, by means of writing a codicil. Alternatively, substitute guardians in case of a sudden change of circumstances can be appointed in the Will. 

A guardian appointed in the Will would be responsible for the day-to-day care and upbringing of the child(ren).  How you would like your children to be brought up can be explained in a letter to ensure your wishes are taken into account and made clear to the guardians chosen.  

 

Setting up Trusts for children

It is a good idea to set up a trust for your children's inheritance as it allows you some control over your money once you pass away.  It is possible for you to lay down certain terms to help protect assets from youthful irresponsibility.

This is particularly useful when making long term financial provisions for disabled children. 

There are various situations in which a trust may be set up, and not all of them are related to making a Will. For the purposes of making a Will, trusts are usually set up for one of the following reasons:

  • To hold assets on behalf of a child until they reach the age of 18. Doing so allows for the property or money to be properly managed until the children are old enough legally to take possession of it. Some types of trust allow the beneficiary to receive an income from the property.
  • To reduce the Inheritance Tax liability. Putting assets into trusts can in some cases reduce or even eliminate the inheritance tax liability for that asset; it can also help to keep the value of the estate within the nil-rate band.
  • To provide for your spouse while keeping the estate intact to be passed to your children.
  • To protect the family home from being sold in order to pay for residential care.

For advice on how a trust could work in your specific circumstances, you should speak to a legal or financial professional

 

Charity donations

In your Will you can include any legacy that you wish to leave to particular organisations or charities.  This could be a specific amount of money or even a valuable item, for example a piece of jewellery.

Any charitable donations you make in your Will are free from Inheritance Tax. 

 

Funeral Arrangements

By making a Will, you can ensure that the desired recipients of your assets gain access to them far more quickly than if there is no Will in place.  This means that they can use any money you have set aside for funeral costs or inheritance you have left them to pay for the funeral arrangements, without having to use their own money.

Within your Will you can make known your wishes for your funeral, for example, whether you want to be buried or cremated, where you want the funeral to take place, and any specific music or readings you would like included. 

 

Problems for those left behind

By not preparing a Will you inevitably would cause difficulties for those you leave behind, at a time which is already distressing.

Firstly, your next of kin may be unsure as to whether or not you have prepared a Will. This means that they would probably have to spend time and money on searching for one.

Once sure that no Will had been made they would probably go through the courts in an attempt to gain the power to deal with your estate.  If a Will had been prepared this would be unnecessary as all Spanish Wills are registered, a process that is far quicker and easier to complete.

Due to the delay in gaining access to your assets, your next of kin would have to pay for funeral expenses from their own funds.  There is also the possibility that they would have to pay inheritance tax before receiving any of your assets, a problem which often leads to financial hardship and even debt.

If you have children and their mother is not alive, unless you have appointed guardians, your next of kin would need to deal with this too.  This is also dealt with through the court, which is costly and time consuming.

When your next of kin reached the point where they had access to your estate, they would have to distribute according to the Laws of Intestacy in Spain.

Contact : Chris Ross - Mobile: 661-908-980 any time for questions or queries.
 
Office : Tel. 922-735-672      E-mail: info@tenerifeinsurance.biz
Address : Calle Clara Toledo Gómez, Local A, 38639 Las Chafiras, San Miguel de Abona