Fights over inheritance are rife – here’s how to bulletproof your will

From the taxman to ex-partners and wayward grandchildren, plenty of people may be gunning for your wealth once you pass away.

Whether you have specific plans for your possessions, or you simply want to stop certain people – such as a child’s ex-spouse – from staking a claim, you can set out how you want your hard-earned money and assets to be distributed to your loved ones by writing a will.

But inheritance disputes can still arise – and they’re getting more common. According to law firm JMW Solicitors, there was a 45pc surge in inheritance dispute cases in 2022, and the number of companies offering dispute resolution services has more than doubled over the past four years. 

You can’t stop people complaining, but Telegraph Money explains the ways to make sure the document is as bulletproof as possible.

Ward off inheritance tax

When you die, HMRC will want to know the value of your assets, minus any liabilities – known as your estate, for inheritance tax purposes (IHT).

There is a tax-free allowance for the first £325,000 of your wealth, known as the nil-rate band. There’s also the property nil-rate band, which can add up to £175,000 to your tax-free total – this is for passing your main residence to a direct descendant (like a child, stepchild or grandchild), as long as the total estate value is below £2m.

If your home is worth £2m or more, the exemption for your property reduces by £1 for every £2 above this threshold. 

Anything above these allowances will incur inheritance tax at 40pc, but certain clauses in your will can reduce the IHT bill, or avoid it altogether. 

For instance, if you explicitly state that your assets are to be left to your surviving spouse or civil partner, there will be no IHT to pay – and no limit on the size of estate you can transfer. 

If you were to die without a will, intestacy rules would come into play. On estates worth up to £270,000, your spouse or civil partner would automatically get all of the estate, but if it’s worth more then it will be split equally between them and your children. Money that isn’t inherited by your spouse could therefore trigger an IHT bill.

Similarly, if your will states that you want to donate 10pc of your net estate to charity, the IHT rate will be reduced to 36pc, meaning the taxman would take a smaller cut of your estate.

Without making this clear in a will, your family could end up with a large tax charge on your estate, taking a huge chunk out of the inheritance you planned to leave them.

Now read: Six easy (and completely legal) ways to avoid inheritance tax

Protect your partner

If you are part of the many couples deciding against marriage or civil partnership, your will plays an even more important role if you want to make sure your partner is provided for when you die.

While spouses and civil partners have a legal right to property that is jointly owned, this is not the case for those who haven’t tied the knot – even if you have been living together for many years and have children together. 

You would therefore need to explicitly leave a property or other assets to your partner in your will to avoid disputes – especially if there are exes or children that also expect a share in your estate.

If left to the intestacy rules, the estate would automatically get split between your children, cutting out your partner entirely. 

If you don’t have children, the estate would go to your parents; if they’re not alive it would then pass to your siblings, nephews or nieces. 

Depending on who survives you, increasingly distant relatives could inherit your estate, but if there are none then the entirety of your estate could be taken by the crown – even if you had a long-term partner, but weren’t married to them.

Now read: The best way to invest an inheritance and protect your newfound wealth

Explain your wishes

There may be lots of people who expect to be included in your will – if you feel otherwise, then the document offers a chance for you to specify who does (and doesn’t) get what.

However, note that someone who was financially dependent on you while you were alive can make a claim against your estate if they feel your will does not make "reasonable financial provision" for them. 

If you want to exclude someone from your will, it is worth stating this explicitly in the will itself, and also writing a separate signed and dated letter explaining your decision. This can help if your will is contested.

You could even discuss the decision with the person while you are alive, to explain your position – if you are brave enough to raise the issue.

A question of trusts

Leaving assets directly to your children or grandchildren can mean your hard-earned money gets spent in more frivolous ways than you’d like; you may have intended it as a house deposit, but it could get spent on nights out and holidays.

There is not much you can do about this from beyond the grave – but you can set up a trust to essentially ring-fence the assets, which protects them against bankruptcy, divorce and being spent in a way you don’t agree with. 

You can name trustees to administer them, and also decide how and when the assets should be distributed. For example, you can set minimum age limits for the funds to be released, at a time when the recipients are hopefully more financially responsible.

Trusts offer another way to reduce a potential inheritance tax bill – as long as you live at least seven years after giving away the money, there will be no IHT to pay on what’s left in the trust.

Now read: How to set up a trust to protect your money (and avoid inheritance tax)

Make sure your will is legal

In order for your will to be classified as a legal document it must be written, signed by you, and witnessed by two people.

The witnesses cannot be beneficiaries – that is, they can’t be named as people who will receive any assets when you die. The will itself should make it clear that it replaces all others, that you have the mental capacity to understand its effects, and that you are making it voluntarily.

You can write your own will, but it may be best to seek professional advice to ensure the document avoids any inheritance tax pitfalls, is legal and that your wishes are clear to avoid disputes.

Some banks offer will-writing and estate planning services for a fee, or charities such as Age UK and Mind take part in Free Wills Month each March and October, where they offer people aged 55 and over the opportunity to have a simple will written.

You could also opt for professional will writers who will discuss and advise on your estate and how you want your assets to be distributed. Not all will writers are legally qualified though, so it is worth checking those listed by trade bodies such as the Institute of Professional Willwriters or The Society of Will Writers. All firms and professionals on these lists will have been trained in wills and estate planning.

Using a lawyer is the pricier option, but it can pay in the long run if you have a complex estate.

You’ll also need to appoint executors to carry out the wishes held in your will. Unlike witnesses, they can be featured in your will, so it’s fine to choose close family members or friends, as long as you feel they are trustworthy and willing to take on the responsibility. 

Let your executors know you are appointing them while you are still alive. It is also a good idea to let them or close relatives know where you are storing your will. A will can be kept at home, with a solicitor, at a will storage company or with the London Probate Service.

Now read: What is probate? How it works and how to execute a loved one's will