Who would you like to benefit from your estate?
Before you make your Will, you should consider how you would like to distribute your assets. You may like your entire estate to pass to your spouse or civil partner or, if they are no longer living, to your children or grandchildren. Alternatively, you might prefer for your estate to pass to your siblings and/or their children. If you have any godchildren, they may feature in your thoughts when considering who you would like to benefit from your estate. It might be that you’d like your partner’s family to benefit from your estate, or you might prefer to limit this to only your blood relatives.
A beneficiary doesn’t have to be a specific person – it can be an organisation. For example, your estate could be passed to charities that you specify or, if you prefer, you can leave it to be given to charities decided upon by your Executors. Or you might be a member of a local club (such as a sports club), and wish to leave them a gift of money, to be to spent at their discretion.
Moreover, you can stipulate that a beneficiary must only use the gift left to them for a particular purpose. For example, you may have decided to leave a cash gift of £1,000 to your local tennis club but wish for this to be spent on the upkeep of the courts and nothing else. You can indicate this in your Will or in an accompanying letter of wishes, and the beneficiary (the tennis club) will be informed of this by your Executors.
Your Executors are the people who will be responsible for ensuring the instructions you’ve left in your Will are carried out.
Other issues to give thought to include, but are not limited to:
the way in which you would like each beneficiary to benefit;
whether the assets should pass outright to them, or whether they should only be entitled to the income from the assets; and
the age at which you would like any children to be entitled to the assets.
It is also important to consider making provision for anyone who is financially dependent on you (e.g. your spouse or civil partner, your children, or elderly relatives).
Default beneficiaries
Making a Will can help you to ensure that your estate is distributed in the way that you want. However, events may occur that mean a specific gift cannot pass to the intended beneficiary. For example, a particular beneficiary may have died before you. Or, by the date of your death, the charity to which you left a cash gift might have merged with another charity.
You can address these eventualities in your Will by stating to whom a gift should pass in the event that it can no longer pass to the original beneficiary. These substitutes are called default beneficiaries.
Appointing default beneficiaries allows you to retain further control over the way in which your estate will be distributed upon your death. As such, you should give careful consideration to who you would like to name as default beneficiaries – just as you would when choosing who to name as the primary beneficiaries.
Can a beneficiary also be a witness?
If you ask a beneficiary of your Will to also be a witness to it, then any gift you may have made in your Will to them will generally fail. In other words, it will not pass to them. This will have no bearing on the validity of the rest of your Will. The general rule, therefore, is that beneficiaries shouldn’t also be witnesses. There are, however, some exceptions to this rule.
Can a beneficiary refuse a gift?
The short answer is yes - a beneficiary is not obliged to accept a gift left to them under a Will, and can refuse it. This is referred to as ‘disclaiming’ the gift.