Why Should I Have A Will?
One of the questions I often get asked is “Why Should I Have A Will?” Here are 10 reasons, 8 for everyone and 2 extra for expats in UAE.
- It provides your heirs with clarity on your wishes. This should reduce the possibility of arguments, expensive court battles and long-term damage to family relationships.
- Administering your estate with a Will is generally faster and therefore cheaper. Less money to lawyers and court hearings.
- The deceased chooses their executors who know their role. In most cases, where trusts are formed for young children. On becoming trustees, the executors safeguard the inheritance of the children.
- Where there is no Will, a child would inherit all their inheritance at the age of 18. Many parents I meet, are concerned about the potential long-term damage inheriting a large sum may do to a young person. How it would impact their focus on their education and appreciation of the work needed to earn money. Having a Will enables parents to delay or spread the distribution of the child’s inheritance over time.
- Parents appoint guardians using their Will. Where no Will exists, guardians are appointed by the courts. A parent who wants to make sure their children are cared for by someone they trust should have a Will prepared appointing those people.
- A Will gives the deceased control over who gets his or her assets on death. Gifting assets to those not included under the rules of intestacy. For example gifts of family heirlooms, money, charitable donations and bequests to those who are not provided for under the rules of intestacy such as unmarried partners, former spouses and step-children.
- Governments are responsible for preparing the rules governing the distribution of assets on death. They are rarely if ever, structured in a tax-efficient way. A Will provides control over the distribution of assets which may be done in a tax-efficient way. Reducing death duties, meaning more money goes to your heirs and not to the taxman.
- Changes in the rules of intestacy do not take your personal circumstances into consideration. Reviewing your Will should be done regularly. This is to make sure it remains up to date with changes in your circumstances, wishes and legislation.
Extra Reasons For Expats In Dubai to Have a Will
- Unless a Will exists, the local courts in UAE will seek to distribute assets according to local law. This may be very different from what you were expecting due to the Sharia principles which underpin the law in the UAE. [NB: an announcement was made on 7th November 2020 concerning the laws of inheritance in UAE. However, to date we have none of the details and the proclamation has not been passed into law.]
- If you are domiciled in England and Wales (most Brits living here are), then your worldwide estate is assessed for UK inheritance tax, this includes assets within the UAE. UK Inheritance Tax is charged at a flat rate of 40% on death after exemptions and allowances.