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Saturday, 5 September 2015

Don't get caught out like Rik Mayall!

If you haven’t made a Will yet, read the situation about the comedian Rik Mayall who died of a heart attack in 2014.   Rik Mayall did not make a Will so his estate passes under the intestacy rules prior to the 2014 Powers and Trustees Act. 

This article emphasies the fact that everyone should make a Will, especially single people, considering the new IHT rules which will be coming into force over the next five to six years.

"Rik Mayall's family face huge tax bill - because he failed to make a will to deal with his £1.2million estate

The comedian, who died suddenly at 56 last year, failed to leave a valid will

Could mean complications for wife, Barbara, and their three adult children

His £1.2million estate could be liable for tax of tens of thousands of pounds

Comedian Rik Mayall failed to leave a valid will to deal with his £1.2 million estate, which experts say could leave his family with a large inheritance tax bill.

Mayall, who played scheming Tory MP Alan B’Stard in ITV series The New Statesman, and a host of other comedy characters, died suddenly aged 56 last June.

But probate records reveal he had no will – even though he suffered serious head injuries and nearly died in a quad-bike accident in 1998 – which could mean complications for his wife of 29 years, Barbara, and their three adult children.

His estate could be liable for tax of tens of thousands of pounds which would not have been payable if he had left everything to his wife.

Lawyers have always advised that people should have a valid will to avoid tax pitfalls.

His personal estate would be divided according to Government intestacy rules, which take into account marital status, children or surviving relatives.

Andrew Kidd, a specialist probate solicitor and partner in London law firm Clintons, said that Mayall’s children would be automatically entitled to a share of his net estate of £1,192,701 after funeral and legal expenses, meaning they could inherit an amount liable for inheritance tax.

But Mr Kidd said the amount of any tax payable would depend on the value of Mayall’s chattels or personal belongings which would go to his wife under intestacy rules.

Mr Kidd said that the rules for a married father like Mayall meant his wife would be due to receive £250,000 plus all his ‘chattels’, which would include any personally owned cars, furniture, ornaments, books and jewellery.

 By law, Mayall’s children would then automatically get half the remaining value of the estate, creating a potential tax bill if the amount is more than the inheritance tax limit of £325,000.

 Mayall’s widow would have received a life interest in the remaining half – meaning she could not touch or transfer that money but could claim interest on it.

Mr Kidd added that Mayall’s family could seek to avoid the tax by drawing up a deed of variation to split up his estate, reducing any sum left to the children so it was below the tax threshold.

Please ask Dartford Legal Services about a Will or Trust which may help to avoid liability to IHT.  

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