Some common legal terms and their meaning.
The person, usually the next of kin, responsible for winding up the estate of the deceased where there is no valid Will.
Any possession of value.
Attorney / Attorneys
A person or persons appointed by another to act in his/her place.
Beneficiary / Beneficiaries
The person or persons who benefit or benefits from a Will or Intestacy.
The value of any asset.
Includes both physical and mental capacity and the ability of a person to look after himself/herself and make decisions on his/her own behalf.
The impartial third party who confirms that the person making the LPA understands its nature and scope and has not been induced to make it by fraud or undue pressure.
Court of Protection
The Court which will decide who is to be appointed to look after someone’s affairs if he/she loses mental capacity and does not have an LPA in place.
A legal document that must be signed and witnessed.
Deed of Variation
A legal document enabling the beneficiaries of a deceased’s estate to alter the distribution under a Will or the intestacy rules.
A trust which gives the trustees discretion when to make any distributions to the beneficiaries of the trust.
The person who makes a lasting power of attorney (LPA).
Enduring Power of Attorney (EPA)
A legal document enabling a person to appoint an attorney to act on his/her behalf if that person lost capacity. Since 1 October 2007 EPAs were replaced by LPAs but EPAs from before that date remain valid.
All the assets and liabilities of the deceased.
The person(s) appointed in the Will to call in and wind up the estate of the deceased.
Grant of Probate
The Grant obtained where there is a Will enabling the executors to call in and wind up the estate of the deceased.
Grant of Representation
The umbrella term for a Grant of Probate and Letters of Administration.
High Net Worth
Assets well in excess of the nil rate band.
The money derived from an asset.
A person who dies without a valid Will is intestate.
The situation that arises when a person dies without a valid Will.
The situation that arises when some of the assets fail to be distributed by a Will.
Intestacy (Rules of)
The statutory rules governing how the estate of someone who dies intestate is distributed.
Refers to children, grandchildren and any remoter linear descendants.
The legal situation that arises where two or more people own property jointly and where if one of the joint owners dies his/her share passes automatically to the other surviving joint owner or joint owners known as joint tenants irrespective of the terms of any Will or the intestacy rules.
Lasting Power of Attorney (LPA)
A legal document in which a person appoints one or more other persons, known as attorneys, to act on his/her behalf when he/she is unable to act for herself/himself.
Letters of Administration
The Grant obtained where the deceased died intestate enabling the administrators to call in and wind up the deceased’s affairs.
Letter of Wishes
A letter written by the settlor of a discretionary trust to the trustees giving guidance on how they should make distributions which is not binding on the trustees.
Life Interest Trust
Otherwise known as an interest in possession trust. A trust which enables a person to benefit from trust assets during his/her lifetime which are then passed on to other beneficiaries after his/her death.
Nil Rate Band (NRB)
The amount of the value of assets which a deceased person can leave to friends or family without having to pay any inheritance tax. The NRB is currently £325,000.
A non-practising solicitor is a fully qualified solicitor whose name is on the roll of solicitors and who is regulated by the Solicitors Regulation Authority (SRA) individually but can be someone who works for a company or business which is not authorised and regulated by the SRA and therefore is not working in private practice, advising in their capacity as a solicitor, where a practising certificate is required.
Office of the Public Guardian
The Government office that deals with EPAs and LPAs.
The person(s) who deal with the administration of the estate of a deceased person. A Personal Representative can be either an executor or administrator.
The general term used to describe the process of winding up someone’s estate after he/she dies.
Power of Attorney
A legal document appointing another person to manage the financial affairs of the person making the appointment while that person still has capacity.
A named person who can manage and administer the assets in a Trust for a person’s benefit and on that person’s behalf should he/she lose capacity.
Another word for a trust.
The person who creates the trust and places the assets into it.
Society of Trust & Estate Practitioners.
Tenancy in Common
The legal situation that arises where two or more people own property jointly but where if one of the joint owners dies his/her share will form part of his/her estate and will be distributed according to the terms of the deceased joint owners’ Will or the intestacy rules where there is no Will.
Where a person dies having left a Will he/she is testate.
The person who makes a Will.
Transferable nil rate band
The combined inheritance tax threshold for spouses up to a maximum of £650,000.
A formal arrangement whereby assets are held and managed by a small group of people for the benefit of others.
The duration of the trust. The maximum duration of a trust from the date of creation is 125 years.
The people appointed to manage and administer the trust.
Wealth Preservation Trust
A flexible life interest trust developed by Universal which enables a person to ‘ring-fence’ his/her assets during his/her lifetime and pass them on to future generations.
Will (Last Will & Testament)
A formal legal document setting out a person’s last wishes and instructions as to how his/her estate should be distributed after death.