Making a Will is essential if you want to control where your money goes when you die. If you don’t make a Will the Law, not you, decides how your Estate is distributed. This may not reflect your wishes. The laws of intestacy mean that your Estate will not automatically pass to your spouse, and a common law spouse may get nothing at all.

For the tax year 2004/2005, Inheritance Tax is not payable between husband & wife. However, other beneficiaries (such as your relatives) may be liable to this tax if the total estate is over £263,000. This figure is known as the "nil rate band"

Inheritance Tax is payable at 40% on that part of your estate above £263,000 (Tax Year 2004/2005).

Many married couples are quite unaware of the potential tax bill they leave to their family on the death of the second partner.

If you are married, and you and your spouse have made wills leaving everything to each other, all assets will pass to the survivor free of Inheritance Tax. This is thanks to the "spouse to spouse exemption" rule which is available to all married couples.

Although this achieves the desired effect, it has a marked disadvantage from an Inheritance Tax view, because the liability to Inheritance Tax is compounded so that on the subsequent death of the survivor, Inheritance Tax will be payable on your combined joint estate.

Unfortunately this means that tax at 40% is payable on the value of the estate in excess of £263,000.

Alternatively, it may be possible to pass on some of the assets on first death but enable your spouse to still have financial security after your death by using a Will Trust.

An effective will allows each partner to utilise the nil rate band available. Potentially this enables your family to enjoy a tax saving of up to £100,000 and puts you in control of your own inheritance tax planning.

To speak to one of our fully qualified independent financial advisers now either phone 0871 433 3700 or click the contact section on the bottom of this page and someone will speak to you straight away to help you with inheritance tax issues.