Legal Practice Notes

Sources of funds Practitioners should encourage the personal representatives ( PRs) to organise funding for inheritance tax ( IHT) without delay so money is available promptly—ideally within six months from the end of the month of death, when interest starts to accrue—or, in any event, by the point the grant application is ready to be submitted. Ways to settle the IHT due on the deceased’s estate include: Assets that do not vest in the PRs, such as insurance pay-outs or pension proceeds (noting that forthcoming changes to IHT on pension scheme death benefits may affect sums due to beneficiaries and may slow access to these funds shortly after death) Assets that do not require a grant Payment from the deceased’s bank or building society account, or other qualifying investment, via the Direct Payment Scheme ( DPS) using Form IHT423, or...

This Practice Note provides step-by-step guidance for personal representatives ( PRs) on completing Form IHT35 when claiming relief on estate shares or securities sold at a loss against their value at the date of death, where that value was included in the IHT400 and inheritance tax has been paid. It should be read alongside: Claim for relief loss on sale of Shares Listed stocks and shares IHT411 The Note assumes an understanding of the background and the mechanics of submitting an IHT400 account, together with the ability of PRs to claim loss relief on a sale of shares. It is intended to assist with preparing the following document: Claim for relief loss on sale of Shares This form is also available through Lexis®Smart (subscription sensitive): Claim for relief loss on sale of Shares. The basic conditions for claiming relief under section 179 of the...

Context Jurisdiction clauses frequently appear in commercial contracts and are typically framed as either: Exclusive jurisdiction clauses (see Practice Note: Jurisdiction agreements—exclusive jurisdiction agreements) Non-exclusive jurisdiction clauses (see Practice Note: Jurisdiction agreements—non-exclusive jurisdiction agreements) Where parties have chosen an exclusive jurisdiction term, the default position is that the English court will ordinarily ‘exercise its discretion… to secure compliance with the contractual bargain’. Such provisions now appear ever more often in trust instruments. Nevertheless, several questions arise concerning: the drafting of such clauses the areas to be covered by such clauses the interpretation and effects of such clauses Two examples of jurisdiction clauses As presently encountered, trust jurisdiction provisions create a series of connected issues, including how they are drafted, what they should cover, and how they are interpreted and what they achieve. Before considering their operation, it is useful to look at a couple of...

What is the inherent jurisdiction? This is the power of the High Court to issue declarations and orders to safeguard adults who retain mental capacity to make the relevant decisions but are still vulnerable and at risk owing to the actions or inactions of others. It operates as a safety net for vulnerable individuals... Can the inherent jurisdiction ( IJ) be used? The IJ can be applied to a vulnerable adult who, even if not incapacitated by mental disorder or mental illness, is reasonably believed to be: being constrained subject to coercion or undue influence otherwise deprived of the capacity to make relevant decisions, prevented from exercising free choice, or unable to give or express genuine consent When would the IJ be used? Within safeguarding investigations under sections 42–47 of the Care Act 2014 ( CA 2014), which place a duty on Local...

Liability for own acts Personal representatives ( PRs) can incur liability for what they do or fail to do in connection with their dealings with: third parties beneficiaries under the deceased’s Will or on intestacy fellow personal representatives During the administration, a PR bears personal liability for: fulfilling all obligations arising under any contracts they make, and, when contracting, they are not allowed to confine liability to estate assets within their control any torts they themselves commit any loss caused to the estate by their breach of duty (a devastavit) In general, the same rules govern the liabilities of executors and administrators alike. Contracts As PRs are answerable on the contracts they enter and cannot restrict liability to the assets in their possession, they are personally chargeable and can be sued in a personal capacity and in their own right. Such a claim is an...

This Practice Note has been prepared in collaboration with Anthony Partridge of Ogier, Cayman Islands, and Wisdom Hon of Ogier, Hong Kong. Introduction For individuals who are not domiciled in the Cayman Islands but personally hold assets located in the Cayman Islands, they may put in place a separate Will governed by Cayman Islands law to dispose of those assets and ease the subsequent probate process. Under Cayman Islands law, the governing law for both the formal validity and the essential/material validity of a Will made by a person domiciled abroad depends on the nature of the assets concerned. For immovable property situated in the Cayman Islands, the applicable law is the lex situs, namely the law of the Cayman Islands. For movable property, including cash held in bank accounts or shares in Cayman Islands companies (such as Cayman Islands exempted companies), the applicable law is the law of the...

Application for Grant of Probate No Grant of Representation will be issued by the Registry unless, at the date of death, the deceased owned assets solely in their name, located within the Registry’s jurisdiction, and the relevant asset holder confirms that a grant is needed for those assets. Guernsey domiciled testator In Guernsey, the Probate Registry administers the probate jurisdiction locally. The Registrar manages the Registry’s day-to-day business, handling daily administration in practice......

Legal framework Although a grant of probate is not a statutory necessity in Guernsey for a deceased person’s Will, in practical terms it is commonly required to enable the administration of the deceased’s Guernsey‑situs assets. As a consequence, individuals domiciled abroad who hold Guernsey‑situs property are increasingly adopting Guernsey‑specific Wills to streamline the management of their Guernsey estate on death. Guernsey’s legal system is founded on customary law, with succession and real property rules derived from the Norman and French common law predating 1789. That heritage influences how Guernsey Wills are interpreted and how succession to Guernsey realty operates. These historical foundations continue to shape current practice and procedure today. Even so, Guernsey also seeks to acknowledge the validity of foreign Wills, aligning with shared objectives of private international law. This policy aims to ease cross‑border estate...

ARCHIVED: This archived Practice note provides links to relevant News Analyses on Brexit featured on Private Client and found in the Brexit collection. Date, News Analysis and a brief description are set out below. 26 January 2021 — Private Client— Brexit considerations Private Client analysis: On 24 December 2020, one week before the Brexit transition ended at 11pm on 31 December 2020 ( IP completion day), Prime Minister Boris Johnson confirmed the UK and EU had reached a deal. Angharad Lynn, senior associate at VWV, assesses the effect of the Trade and Cooperation Agreement ( TCA) on private client law in the UK. 22 January 2021 — Pensions after Brexit and the UK- EU trade deal Pensions analysis: Rosalind Conner and Danyal Enver, managing partner and associate respectively at Arc Pensions Law, examine the consequences for pensions after Brexit in the wake of the...

HMRC's online Trust Registration Service ( TRS) HMRC’s online Trust Registration Service ( TRS) was created to give effect to the Money Laundering, Terrorist Financing and Transfer of Funds ( Information on the Payer) Regulations 2017 ( MLR 2017), SI 2017/692, while advancing HMRC’s digital agenda and wider tax transparency. Subsequent enhancements were made in response to additional obligations from the fifth EU anti-money laundering directive, Directive ( EU) 2018/843 (5MLD), implemented via the Money Laundering and Terrorist Financing ( Amendment) ( EU Exit) Regulations 2020 ( MLR 2020), SI 2020/991. Although estates were not initially within MLR 2017, SI 2017/692, HMRC launched the online ERS alongside the TRS to capture complex estates’ income tax and capital gains tax ( CGT) reporting. In practice, the TRS and ERS arrived within the same online platform, though it remains convenient to describe them...

FORTHCOMING CHANGE : The Trusts and Succession ( Scotland) Act 2024 obtained Royal Assent on 30 January 2024, signalling the first major review of Scottish trusts law in over a century, since the foundational Trusts ( Scotland) Act 1921. The trusts-related provisions will only take effect once Scottish Ministers bring forward the necessary secondary legislation, whereas certain measures on succession commenced on 30 April 2024. Key updates aimed at modernising the framework are summarised in News Analysis: Trusts and Succession ( Scotland) Bill passed. Practice Notes covering Scottish trusts and succession will be updated further to reflect this new legislation... Appointment as trustee in Will or deed In practice, trustees are appointed (or nominated) in the relevant deed of trust. For Will trusts (or mortis causa settlements), the trust deed is, or is derived from, the deceased’s Will. An appointment only takes effect once the nominee...

Introduction and background Certain advisers who deliver tax advice and deal with HMRC for clients will have to enrol with HMRC in future and comply with baseline standards set by the department. HMRC has signalled that roll-out will feature a transition window of no less than three months. In the Autumn Budget 2024, on 30 October 2024, the government stated it would require registration of tax advisers acting with HMRC on clients’ behalf from April 2026, and it released a summary of replies to a consultation first issued in March 2024. Those replies clearly backed compulsory registration. In Budget 2025, the government said that, in light of the consultation feedback, it would not regulate tax advisers and would collaborate with the profession to lift standards in the tax advice market. In July 2025, HM Revenue & Customs ( HMRC) issued draft...

Introduction This guide sets out the steps a solicitor preparing a Will should weigh when dealing with a testator who intends to omit a family member or dependant where a challenge may arise. It reviews the background to the testator’s choice, which ought to be recorded on the file in as much detail as possible to explain the reasoning behind it. It also addresses the statement a solicitor should draft within the Will, or refer to in the Will, giving a clear signal that this potential beneficiary was considered and intentionally left out. Estates are being litigated more often, and even a modest estate can represent a life changing sum for many. While it may not be entirely feasible to prevent a claim, certain measures can lessen claims and the related risks. Relevant...

Introduction The behaviour of the party who seeks financial provision has long been a relevant consideration over many years. Section 1(6) of the Inheritance ( Family Provision) Act 1938 ( I( FP) A 1938), as amended, instructed the court to take into account and carefully weigh “the conduct of the applicant in relation to the deceased and otherwise”. Although section 3(1)(g) of the Inheritance ( Provision for Family and Dependants) Act 1975 ( I( PFD) A 1975) does not expressly cite conduct towards the deceased, on its face, it has, in practice, most often been, in reality, the claimant’s behaviour towards the deceased that has influenced the court in deciding both whether the disposition of the deceased’s estate failed to make reasonable provision and, if so, in what way and to what extent it should use its discretion. Because conduct by any...

In family enterprises, succession is a complex, multi-faceted journey, not a one-off moment. The enduring challenge is to balance the interests of the owners, the business itself, and the wider family and its interests. It requires input from advisers with diverse technical specialisms and backgrounds; to help them collaborate effectively in the family firm's best interests, it is useful to view succession as moving through a series of distinct, successive stages over time. If any stage is overlooked or poorly handled, the transition may stall or prove unsuccessful. The phases are preparation, disengagement, exploration, choice and implementation, and the tasks within each are set out below. Preparation In readiness for transferring the family business: the family must acknowledge and accept that change is unavoidable they should invest in learning from what other families have done and gather information and insights on the latest...

Family office The phrase ‘family office’ spans a wide array of circumstances, so there is no universally agreed definition. The Family Firm Institute, however, characterises a family office as: ‘ A separate entity apart from the operating business (and sometimes created with the assets realised after the sale of a family enterprise) consisting of a diversified wealth portfolio held for the benefit of the family’ ( Family Enterprise; understanding Families in Business and Families of Wealth Wiley 2014 (not reported by Lexis Nexis®)). Such offices are largely, and more commonly, the preserve of high net worth—indeed ultra high net worth—families (ie those with investable assets above $30m), with varied holdings and complex affairs. That complexity can create scope for disputes. Nonetheless, with a well-designed structure supported by a clear strategy and effective family governance, a family office can yield substantial...

Most family-run enterprises are in private hands rather than publicly listed. Consequently, the governance framework designed for quoted companies, such as the UK Corporate Governance Code ( UKCG Code) and the FRC Guidance on Board Effectiveness, tends to be of only peripheral relevance to them. Evolution of the board in a family business In the typical nascent family venture, the founder entrepreneur usually leads the board, with relatives commonly in supporting positions within the business. That said, even among sizeable, longstanding family firms, boards frequently comprise a family majority, particularly in well-established businesses of significant scale. A central challenge, if the business is to endure and prosper, is shaping a capable board—one that harnesses the owning family’s advantages, recognises and offsets skill gaps, whilst delivering clear and robust strategic direction and diligent oversight. In reality, the board, its make-up and remit must mature in step with the...

Principle 9 In March 2010, the European Confederation of Directors' Associations (eco Da) released Corporate Governance Guidance and Principles for Unlisted Companies in Europe. It sets out 14 principles that family enterprises can adopt in a staged or phased way to shape a governance framework suited to their needs, considering the company’s size and the ownership group’s complexity. Principle 9 champions sound governance in family-controlled businesses and recommends putting in place family governance mechanisms that encourage coordination and mutual understanding amongst family members, whilst also organising the relationship between family governance and corporate governance. This reflects the long-accepted view in the family business field that any strategy seeking to optimise a family’s financial, intellectual and social wealth must include practical guidance on governing the family well. Yet the eco Da guidance unfortunately blurs ‘family’ with ‘owners’. These are separate interests that require distinct...

Introduction From 6 April 2027, the draft Finance Bill 2025–26 will overhaul how pension assets are taxed on death. Unspent pension pots and discretionary lump‑sum death payments will count within the deceased’s estate for inheritance tax ( IHT). Gifts to a spouse, civil partner or a charity stay exempt; however, passing funds to other recipients (for example, children) could face a 40% charge. Where death occurs after age 75, beneficiaries’ withdrawals can also incur income tax, potentially producing a combined tax hit of as much as 67%. Key Changes unused pension pots and discretionary death benefits will fall within the scope of IHT personal representatives must handle valuation and reporting of these liabilities......

Who is intended as a new trustee? Anyone with legal capacity to own and administer property may serve as a trustee (see Practice Note: Trustees—appointment of trustees), and a corporate body can likewise perform this function where permitted (see Practice Note: Trust corporations for law firms). A proposed trustee should fully grasp their duties and obligations, which can be considerable, and prospective candidates should recognise these demands. Consider whether a trust instrument exists and, if so, what authority it grants for appointing fresh trustees. The settlor may keep the power to appoint during life, with that power moving to the trustees on death, or the settlor may nominate another holder to exercise that power. Trust deeds commonly confer on the current trustees the authority to appoint additional or replacement trustees under the deed itself. If no express power applies—or in parallel with it—ask whether a...