As we all know, everything seems to be able to be done online now. And this includes everything from online banking to dealing with investments and other financial matters online. There’s no doubt that a great number of us are doing more and more online with the result that we’re perhaps having less paperwork than ever before. The result of this is that when we die and if we have assets held digitally, it can be very hard for the people who deal with our estate (executors if we have a valid will, administrators if we don’t) to actually ascertain what we do and don’t own!
So for example, suppose someone dies with a property worth say £250,000 and a bank account with £20,000 in it and some premium bonds worth £50,000, then their estate would be worth £320,000, just short of the Inheritance Tax nil rate band of £325,000, (assuming no applicable exemptions or reliefs). But supposing that this person also held assets, for example investments online, and no paper trail could be found by the executors? The size of the estate to be administered changes entirely. If online assets are worth, say, £50,000, then inheritance tax is then payable here and the executors or administrators of the estate must deal with this issue but they clearly may not know about the assets in the first place. So what can we do to assist with this?
The solution is to make a note of our digital assets so there is a record of them. Ultimately, if we don’t do this and the people dealing with an estate are unaware of the assets held, then money may not pass to the beneficiaries meaning they miss out. This could be children, charities or a spouse or civil partner and as much as this scenario may be unintentional, the fact is, it is avoidable just by simply recording one’s assets, placing that record in a safe place and telling a trusted person where this is held so it is then known what assets need to be administered upon death. This equally applies to assets not held digitally, too, as it makes it easy for people dealing with an estate to know where all the assets are. It also means that monies are not dormant in accounts for years on end and an article on MoneySavingExpert.com entitled ‘Reclaim Forgotten Cash’ estimates that up to £15b – yes, that’s billion with a ‘b’ – lie in unclaimed assets. It seems likely that with more and more assets held and dealt with digitally that this figure is likely to increase.
Another reason for recording assets, digitally or otherwise, is that it allows one’s net worth to be ascertained. All the assets add up and it might reveal, for example, that your estate will be subject to inheritance tax when previously you thought it wouldn’t be. You can then take expert advice to save your estate inheritance tax.
This article aims to supply general information but it is not intended to constitute advice. Every effort is made to ensure that any law referred to is correct at the date of publication and to avoid any statement which may mislead. However, no duty of care is assumed to any person and no liability is accepted for any omission or inaccuracy. Always seek specific advice.
Capron & Helliwell Solicitors offer a range of legal services at the firm’s Stalham and Wroxham offices near North Walsham and Norwich in Norfolk. The firm specialises in areas including family law, conveyancing and private client law including wills and probate. Capron & Helliwell Solicitors offer free family law clinics – please call 01692 581231 for further details or to make an appointment.