Happy Pride Month! At this time of celebration, we thought it would be useful to show how important it is for members of the LGBTQIA+ community to have a well-written Will in place.
There can often be legal challenges when it comes to Wills and inheritance, and there are unique hurdles for same-sex couples and individuals when it comes to protecting assets and ensuring that wishes are respected.
In this blog, we will explore the importance of having a Will, especially for those not married or in a civil partnership, and look at the issue of sideways disinheritance which is especially prevalent amongst those within the LGBTQIA+ community.
The Importance Of Having a Will
A legally binding Will is one of the most important legal documents you should put in place, regardless of sexual orientation or gender identity. A Will serves as a powerful tool to protect your legacy and the people you care about most.
Without a Will, the rules of intestacy come into play, and your estate and belongings may end up with someone who you didn’t want them to go to. This can have devastating consequences, both emotionally and financially, for your partner.
Wills For Same-Sex Couples: LGBTQIA+ Wills
In the United Kingdom, the recognition and protection of same-sex relationships has come a long way. Nevertheless, same-sex couples need to be aware of legal considerations to safeguard their rights and wishes. LGBTQIA+ Wills play a vital role in this process by providing the necessary protections and ensuring that intentions are upheld.
It might come as a surprise, but partners are not automatically entitled to any inheritance unless provisions are made for them in a Will. Even in long-term relationships, unless specified in the Will, partners could potentially be left with nothing.
There is a possibility for individuals who have lived together in a relationship for over two years to make a claim for provision under the Inheritance (Provision for Family & Dependants) Act, commonly known as the Inheritance Act. However, this process can be tricky, time-consuming, and emotionally taxing, with no guarantee of a favourable outcome.
By making a Will, same-sex couples can name their partner as a beneficiary, ensuring that they receive their rightful share of the estate.
Providing For Children
A Will allows couples to designate guardianship for children and provide for their financial well-being, offering peace of mind and security. Members of the LGBTQIA+ community often rely on fertility treatments or surrogacy when starting a family.
However, without careful wording in your Will, there is a risk that your children may not receive the intended benefits, as the legal definition of parenthood in such cases may not align with your expectations.
While it is possible to claim under the Inheritance Act in these situations, it raises the question of whether you would want to subject your children to this process. Plus, there is the issue of custody if a guardian hasn’t been appointed.
By making a Will, you can provide for your children, and by appointing a guardian, you’ll be safe in the knowledge that they will be looked after by someone that you have chosen.
The Law Regarding Surrogacy
Under UK law, regardless of where the surrogacy occurs, the surrogate mother is recognised as the legal mother with parental responsibility for the child. Even if you or your partner is the genetic parent, you will not have automatic parental responsibility until a Parental Order is obtained.
To establish legal parenthood, you must apply for a Parental Order from the court, which extinguishes the surrogate mother’s legal status. It is important to note that the application must be made within 6 months of the child’s birth, or alternative options such as adoption would need to be pursued.
Can A Will Save Money On Taxes?
Through effective estate planning, you can save money on taxes. This could be by making gifts and charitable donations, which can help offset estate taxes and potentially provide significant tax benefits.
What About Inheritance Tax?
Couples who are married or in a civil partnership enjoy equal inheritance rights and can inherit a certain portion of their spouse or civil partner’s estate, even without a Will. Additionally, they can transfer assets to each other without incurring any inheritance tax liability.
Cohabiting couples on the other hand don’t receive any special tax benefits. The first £325,000 of an estate (known as the nil rate band) is not subject to tax, but any amount above that is taxed at 40%. Unlike married or civil partner couples, cohabiting partners can’t transfer their unused nil rate band to each other.
To get around this, it’s a great idea to set up a discretionary trust. This will help ensure that the surviving partner can still benefit from their deceased partner’s estate without facing double taxation.
Sarah and Emily live together and have a daughter called Mia. Sarah’s assets are valued at £500,000. If Sarah leaves these assets directly to Emily, an inheritance tax bill of £70,000 would be due.
Then on Emily’s death, the same assets would be subject to inheritance tax again. To potentially avoid this double taxation, Sarah could think about leaving her assets in a discretionary trust. This arrangement allows both Emily and Mia to benefit from the trust, potentially bypassing the double tax payment.
It’s important to note that discretionary trusts may incur inheritance tax charges every ten years and when capital leaves the trust, although the current maximum rate is 6%.
What Is Sideways Disinheritance?
Sideways disinheritance is where an individual’s estate passes sideways to a family member, excluding their partner or chosen beneficiaries. Sadly, this issue can greatly affect the LGBT community.
Devastating cases have emerged where same-sex partners have unjustly been denied their rightful share of their deceased partner’s estate. This happens because there are not enough legal safeguards in place, and some family members object due to biased views against individuals’ sexual orientation.
In a recent case, someone’s estate was inherited by a parent who had previously disowned them specifically because of their sexual orientation. Without a Will, there was no legal mechanism to prevent this outcome.
How To Avoid Sideways Disinheritance
Sideways disinheritance is a clear example of why estate planning is crucial, especially for same-sex couples and LGBTQIA+ individuals. By making a legally binding Will, you can safeguard your loved ones and make sure your assets are distributed exactly as you want them to be.
How Do I Make A Will?
We strongly suggest using a legal expert to help you, for peace of mind that your Will is free from mistakes, and to avoid disputes, legal costs and misunderstandings. If you would like to find out more about making a Will, why not take a look at our online or home visit will writing services?
Why Use ELM?
At ELM Legal, our experienced team is dedicated to helping you navigate the legal intricacies surrounding Wills and inheritance rights, so you can safeguard your legacy and protect your chosen beneficiaries.
We’ve had the privilege of helping over 30,000 clients across England and Wales with their Wills. We understand that each person’s circumstances are different, so we offer free, no-obligation enquiries to make sure we can provide you with a personalised service that meets your specific needs.
Are There Any Other Documents I Need To Make?
It’s a great idea to consider creating a Lasting Power of Attorney alongside your Will. This legal document allows you to choose a trusted person (known as the Attorney) who can make important decisions on your behalf, especially if you are hospitalised or facing a long-term diagnosis.
By having a Lasting Power of Attorney in place, you can ensure that someone you trust will be there to handle matters when you may not be able to do so yourself.
Keeping Your Will Up To Date
Keeping your legal documents up to date is vitally important. Once your Will has been signed and witnessed, do not change it yourself (no matter how tempting!), as this could invalidate the entire document.
Instead, the best way to update your Will is either by creating a new one or by adding a codicil, which acts as an amendment, to make the necessary changes while keeping the integrity of the original. This makes sure that your wishes are accurately reflected without your Will being rendered invalid.