Abatement
Abatement is the proportional reduction of gifts in a will when the estate has insufficient funds to pay all legacies in full after settling debts, funeral costs, and administration expenses.
Reference
Glossary
Clear definitions of legal terms and concepts related to wills and estate planning.
A
Accumulation and Maintenance Trust
An Accumulation and Maintenance Trust (A&M Trust) is a historical trust type that allowed income to be saved or spent on a child's needs until they reached 18 or 25, with tax advantages that ended in 2006.
Ademption
Ademption is the automatic failure of a specific gift in a will when the testator no longer owns that particular item at death, leaving the intended beneficiary with nothing.
Administrator
An administrator is a person appointed by the Probate Registry to manage and distribute the estate of someone who died without a valid will or when no executor can act.
Age of Majority
Age of majority is 18 in England and Wales—the age when you legally become an adult with full rights to make a will, inherit property directly, and enter into binding contracts.
Agricultural Property Relief (APR)
Agricultural Property Relief (APR) is an inheritance tax relief that reduces or eliminates tax on qualifying farmland, farm buildings, and farmhouses when passed to beneficiaries, helping keep family farms intact.
Annual Exemption
The Annual Exemption is the £3,000 allowance each person can give away each tax year (6 April to 5 April) without those gifts being added to their estate for inheritance tax purposes.
Assets
Assets are everything you own that has value—including property, savings, investments, personal possessions, and digital accounts—which together form your estate when you die.
Attestation Clause
An attestation clause is the formal statement at the end of a will that records how the testator and witnesses signed the document, providing crucial evidence that the will was executed properly according to UK law.
B
Bare Trust
A bare trust is a simple trust arrangement where a trustee holds assets for a beneficiary who has the absolute right to receive them on demand once they reach adulthood (age 18 in England and Wales, 16 in Scotland).
Beneficial Interest
Beneficial interest is the right to enjoy the economic benefits of a property or asset (such as income, use, or sale proceeds) even when someone else holds the legal title.
Beneficiary
A beneficiary is a person or organisation you name in your will to receive assets, money, or property from your estate after you die.
Beneficiary Witness Rule
The Beneficiary Witness Rule is a legal principle under Section 15 of the Wills Act 1837 that voids any gift to a person (or their spouse or civil partner) who acts as a witness to a will, although the will itself remains valid.
Business Property Relief (BPR)
Business Property Relief (BPR) is an inheritance tax relief that reduces qualifying business assets' taxable value by 50% or 100%, enabling family businesses to pass to heirs without being sold to pay tax.
C
Capital Gains Tax (Estate Context)
Capital Gains Tax in an estate context refers to the tax treatment of asset gains when someone dies and during estate administration, where death provides a tax-free 'uplift' that eliminates CGT on historical gains.
Chargeable Estate
Your chargeable estate is the portion of your estate that's actually subject to Inheritance Tax, calculated after deducting debts, exemptions like spouse gifts, and reliefs from everything you own.
Chargeable Lifetime Transfer (CLT)
A Chargeable Lifetime Transfer (CLT) is a gift made during your lifetime—typically into a trust—that triggers an immediate inheritance tax charge of 20% on amounts exceeding £325,000.
Charity Exemption
Charity exemption is an inheritance tax relief that makes gifts to UK registered charities completely tax-free and can reduce the tax rate on the rest of your estate from 40% to 36%.
Codicil
A codicil is a legal document that makes specific changes to an existing will without replacing the entire will, though modern practice generally favours writing a new will instead.
Commorientes Rule
The commorientes rule is a legal presumption that when two or more people die together and you cannot prove who died first, the younger person is deemed to have survived the older person.
Contemplation of Marriage Clause
A contemplation of marriage clause is a provision in your will that prevents it from being automatically cancelled when you marry a particular named person.
Contingent Interest
A contingent interest is a right to receive inheritance or trust property only if a specific condition is met, such as reaching a certain age or surviving another person.
D
Death in Service Benefit
Death in service benefit is a tax-free lump sum payment, typically 2-4 times your salary, that your employer provides to your nominated beneficiaries if you die while employed.
Deed of Variation
A deed of variation is a legal document that allows beneficiaries to redirect their inheritance within two years of someone's death, treating the change as if the deceased had made it themselves.
Direct Descendants
Direct descendants are your children, grandchildren, great-grandchildren, and all future generations in your direct family line, including legally adopted children and stepchildren (if you're married to their parent).
Disabled Person's Trust
A Disabled Person's Trust is a legal arrangement that holds assets for someone with a qualifying disability, protecting their eligibility for means-tested benefits while providing significant inheritance tax advantages.
Disclaimer (of Inheritance)
A disclaimer of inheritance is a formal refusal to accept a gift left to you in a will or through intestacy, treating you as if you had never been entitled to it.
Discretionary Trust
A discretionary trust is a flexible trust arrangement where trustees have complete discretion to decide which beneficiaries receive trust assets, how much they receive, and when distributions are made.
Domicile
Domicile is the country you consider your permanent legal home where you intend to settle long-term, which determines which country's laws apply to your inheritance and estate.
E
Estate
An estate is everything a person owns (their assets) minus everything they owe (their debts), which passes to their beneficiaries after death.
Estate Planning
Estate planning is organizing how your property, money, and possessions will be managed and passed on when you die or if you become unable to make decisions yourself.
Execution (of a Will)
Execution of a will is the formal signing process required by law to make your will legally valid, involving your signature and two independent witnesses who must be present together.
Executor
An executor is the person you name in your will to manage your estate after you die, ensuring your debts are paid and your belongings go to the right people.
F
Financial Advisor / IFA
A financial advisor is an FCA-regulated professional who provides expert advice on investments, pensions, inheritance tax planning, and financial strategies to help you manage and protect your wealth.
Forfeiture Rule
The Forfeiture Rule prevents anyone who unlawfully kills another person from inheriting from their victim's estate or receiving any financial benefit arising from the death.
Fraud
Fraud in wills is the deliberate use of deception, misrepresentation, or dishonesty to manipulate a will's contents or who benefits from it, making the will invalid.
G
Gift with Reservation of Benefit (GROB)
A Gift with Reservation of Benefit (GROB) occurs when you give away an asset but continue to use it or benefit from it, meaning it remains in your estate for inheritance tax purposes.
Gifts out of Normal Expenditure
Gifts out of normal expenditure is an inheritance tax exemption that allows you to make unlimited regular gifts from your surplus income without them counting toward your estate—provided they don't reduce your standard of living.
Grant of Probate
A Grant of Probate is an official court document issued by the Probate Registry that gives executors the legal authority to access, manage, and distribute a deceased person's estate when there's a valid will.
Gross Estate
Gross estate is the total value of everything you own at death—including property, savings, investments, possessions, and gifts made within seven years—before deducting any debts or liabilities.
Guardian
A guardian is a person you legally appoint in your will to care for your children if you die before they turn 18, giving them full parental responsibility—the same legal authority you currently have.
H
Heritage Assets Relief
Heritage Assets Relief provides conditional exemption from inheritance tax and capital gains tax for nationally important buildings, land, artworks, and collections, provided they are preserved in the UK and made accessible to the public according to agreed undertakings.
HMRC
HMRC (His Majesty's Revenue and Customs) is the UK government department that collects taxes, including inheritance tax, and provides clearance needed for executors to obtain probate.
Holographic Will
A holographic will is a will written entirely by hand by the person making it, but in England and Wales it must still be witnessed by two independent adults to be legally valid—the handwritten format does not exempt it from normal witnessing requirements.
I
IHT400
Form IHT400 is HMRC's detailed Inheritance Tax return that executors complete to report the full value of an estate and calculate any tax due.
Inheritance
Inheritance is the money, property, and possessions you receive from someone who has died, either as they specified in their will or according to legal rules if they didn't make one.
Inheritance Tax (IHT)
Inheritance Tax (IHT) is a tax paid on the estate of someone who has died, charged at 40% on the value above £325,000.
Intestacy
Intestacy occurs when someone dies without a valid will, meaning strict legal rules—rather than the deceased's wishes—automatically determine who inherits their estate.
Invalid Will
An invalid will is a will that doesn't meet the legal requirements for validity under UK law, making it unenforceable and unable to distribute the deceased person's estate.
L
Lapse
Lapse is when a gift in your will fails because the intended beneficiary has died before you, causing that gift to return to your estate's residue unless specific exceptions apply.
Law Society
The Law Society is the professional organization for solicitors in England and Wales that represents their interests, sets best-practice standards, and provides resources to help you find qualified legal professionals for wills and estate planning work.
Legacy / Bequest
A legacy (also called a bequest) is any gift you leave to someone in your will, whether it's a specific item like jewellery, a cash sum, or a share of what remains after other gifts and expenses.
Letter of Wishes
A Letter of Wishes is a confidential, non-binding document you write alongside your will to provide guidance to your executors and trustees on how you'd like them to manage your estate and exercise their discretionary powers.
Letters of Administration
Letters of Administration is a court document issued by the Probate Registry that gives legal authority to manage and distribute the estate of someone who died without a valid will (intestate).
Liabilities / Debts
Liabilities are financial obligations—such as debts, taxes, and funeral expenses—that must be paid from your estate before any inheritance can be distributed to your beneficiaries.
Life Insurance Trusts
A life insurance trust is a legal arrangement where you place your life insurance policy into a trust so the payout bypasses your estate, avoiding inheritance tax and probate delays while providing immediate funds to your chosen beneficiaries.
Life Interest Trust
A Life Interest Trust is a trust that allows someone (the life tenant) to use or benefit from assets during their lifetime, while preserving those assets for others (the remaindermen) to inherit after the life tenant dies.
Lifetime Gift
A lifetime gift is cash, property, or any asset you give away during your lifetime, which can reduce your inheritance tax bill if you survive seven years after making the gift.
Lifetime Trust
A lifetime trust (also called an inter vivos trust or living trust) is created during your lifetime, where you transfer legal ownership of assets to trustees who manage them for beneficiaries according to terms in your trust deed.
M
Minor
A minor is anyone under 18 years old who has not yet reached the age of majority and therefore has limited legal capacity to manage assets or make binding legal decisions.
Mirror Wills
Mirror wills are two separate matching wills created by a couple, where each partner leaves their estate to the other first, then to the same beneficiaries after both have died.
Mutual Wills
Mutual wills are separate wills made by two people (typically spouses) containing a legally binding agreement that prevents the survivor from changing their will after the first person dies.
N
Net Estate
Net estate is the total value of everything you own (your gross estate) minus all debts, mortgages, and other liabilities you owe at the time of your death.
Nil-Rate Band (NRB)
The nil-rate band is the amount of your estate—currently £325,000—that can be passed on when you die without your beneficiaries paying inheritance tax.
P
Partial Intestacy
Partial intestacy occurs when someone dies with a valid will that doesn't dispose of all their assets, causing the undistributed portion to pass according to intestacy rules rather than their wishes.
Pecuniary Legacy
A pecuniary legacy is a fixed sum of money that you leave to a specific person or charity in your will, such as "£10,000 to my nephew James" or "£5,000 to the RSPCA."
Pension Nomination
A pension nomination (or expression of wish) is a form telling your pension provider who should receive your pension savings if you die, though the decision ultimately rests with the pension scheme trustees.
Per Capita
Per capita is a distribution method where your estate is divided equally among all living beneficiaries in a specified group, with no share passing to a deceased beneficiary's children.
Per Stirpes
Per stirpes is a distribution method in wills where each family branch receives an equal share, with deceased beneficiaries' children inheriting their parent's portion equally between themselves.
Periodic Charge
A periodic charge is inheritance tax of up to 6% that trustees must pay every ten years on certain trust assets exceeding the nil-rate band, primarily affecting discretionary trusts.
Personal Chattels
Personal chattels are your tangible movable belongings—like furniture, jewellery, vehicles, artwork, and pets—excluding money, business assets, and items held purely as investments.
Pilot Trust
A pilot trust is a discretionary trust created during your lifetime with a nominal sum (typically £10) that sits dormant until substantial assets are added, usually via your will or pension benefits.
Potentially Exempt Transfer (PET)
A Potentially Exempt Transfer (PET) is a gift made during your lifetime to another person that becomes completely exempt from Inheritance Tax if you survive for seven years after making it.
Power of Appointment
A power of appointment is the legal authority granted under a will or trust that allows someone (the donee) to decide how trust assets are distributed among beneficiaries, including the discretion not to distribute them at all.
Pre-Owned Asset Tax (POAT)
Pre-Owned Asset Tax (POAT) is an annual income tax charge on people who continue benefiting from assets they previously owned or funded after giving them away.
Presence
Presence is the legal requirement that the testator and both witnesses must be physically in the same location at the same time, able to see each other during the will signing process.
Probate
Probate is the legal authority that allows executors to access, manage, and distribute a deceased person's money, property, and possessions according to their will or intestacy rules.
Property Protection Trust
A Property Protection Trust is a type of Life Interest Trust that protects your share of a property for chosen beneficiaries while allowing someone else (typically your spouse) to live there during their lifetime.
Protective Trust
A protective trust gives a beneficiary the right to trust income unless triggering events like bankruptcy occur, when it automatically converts to a discretionary trust to safeguard assets.
R
Reduced IHT Rate (36%)
The reduced IHT rate is a lower inheritance tax rate of 36% (instead of 40%) that applies when you leave at least 10% of your baseline estate to qualifying UK charities.
Relevant Property Trust
A Relevant Property Trust is any trust subject to special inheritance tax charges when assets enter the trust, every 10 years, and when assets are distributed to beneficiaries—most commonly discretionary trusts created since March 2006.
Remote Witnessing
Remote witnessing was a temporary COVID-19 measure (31 January 2020 to 31 January 2024) that allowed will witnesses to observe signing via video call instead of being physically present—this is no longer permitted in England and Wales.
Residence Nil-Rate Band (RNRB)
The Residence Nil-Rate Band (RNRB) is an additional inheritance tax allowance, currently £175,000, available when you leave your home to your children or grandchildren, potentially increasing tax-free inheritance to £500,000.
Residuary Beneficiary
A residuary beneficiary is someone who inherits whatever remains of an estate after all debts, taxes, funeral costs, and specific gifts have been paid—often the largest and most valuable portion of the estate.
Residuary Estate / Residue
The residuary estate (or residue) is everything left in your estate after all debts, taxes, expenses, and specific gifts in your will have been paid and distributed.
Revocation
Revocation is the legal cancellation of a will, making it void and without legal effect, either through deliberate actions like creating a new will or automatically when you marry or enter a civil partnership.
S
Settlor
A settlor is the person who creates a trust by transferring their assets into it and setting the rules for how those assets should be managed and distributed to beneficiaries.
Seven-Year Rule
The Seven-year rule means that gifts you make during your lifetime become completely free from Inheritance Tax if you survive for at least seven years after making them.
Small Gifts Exemption
The small gifts exemption allows you to give up to £250 to unlimited recipients each tax year without inheritance tax, provided you haven't used another exemption for the same person.
Solicitor
A solicitor is a qualified legal professional regulated by the Solicitors Regulation Authority who provides expert legal advice and services, including will writing, estate planning, and probate administration.
Specific Legacy
A specific legacy is a gift in your will of a particular item you own, such as "my diamond engagement ring" or "my 2020 Audi Q5", identified by describing the specific asset with possessive language.
Spouse Exemption
Spouse exemption is an Inheritance Tax relief that allows married couples and civil partners to pass unlimited assets to each other tax-free during life or on death.
Statutory Legacy
Statutory legacy is the fixed sum (currently £322,000) that a surviving spouse or civil partner automatically receives when someone dies without a valid will and has children.
STEP (Society of Trust and Estate Practitioners)
STEP (Society of Trust and Estate Practitioners) is the global professional body for inheritance and estate planning specialists, whose full members earn the designation TEP (Trust and Estate Practitioner) after demonstrating rigorous qualifications and experience.
T
Taper Relief
Taper relief is a sliding-scale tax reduction on large gifts made 3-7 years before death, reducing the inheritance tax payable (not the gift's value) based on how long the donor survived.
Tax Year
The tax year is the 12-month period from 6 April to 5 April that HMRC uses to assess your tax liability and reset annual allowances and exemptions.
Testamentary Capacity
Testamentary capacity is the legal requirement that you understand the nature of making a will, know what you own, recognise who should reasonably benefit, and are not influenced by any mental disorder when making your will.
Testator
A testator is the person who creates and signs a will, deciding how their estate (money, property, and possessions) should be distributed after they die.
Transferable Nil-Rate Band (TNRB)
The Transferable Nil-Rate Band (TNRB) allows married couples and civil partners to combine their £325,000 inheritance tax allowances, potentially passing up to £650,000 to beneficiaries tax-free.
Trust
A trust is a legal arrangement where assets are held and managed by trustees for the benefit of chosen beneficiaries, according to instructions set by the person who created the trust.
Trust Deed
A trust deed is the legal document that creates a lifetime trust and sets out how the trust assets should be managed and distributed to beneficiaries.
Trust Fund
A trust fund is the collection of assets—such as money, property, or investments—held and managed by trustees for the benefit of named beneficiaries according to specific rules set by the settlor.
Trustee
A trustee is a person or organisation you appoint to manage money or assets held in trust, with legal responsibility to use them solely for your beneficiaries' benefit.
U
Undue Influence
Undue influence is coercion that overpowers a person's free will when making a will, forcing them to include provisions they would not otherwise have made but for that pressure.
Uplift in Base Value
Uplift in base value is the automatic resetting of an asset's taxable value to its market price at the date of death, meaning beneficiaries only pay Capital Gains Tax on increases after inheritance, not on the deceased's lifetime gains.
V
Vested Interest
A vested interest is a guaranteed right to property or assets under a will or trust that cannot be taken away, even if the beneficiary must wait to receive it.
Vulnerable Beneficiary Trust
A Vulnerable Beneficiary Trust is a tax-advantaged trust established in a will to provide financial support for a disabled person or bereaved child while protecting their entitlement to means-tested benefits.
W
Wedding Gifts Exemption
The Wedding Gifts Exemption allows you to give tax-free gifts to someone getting married or entering a civil partnership, with the amount you can give depending on your relationship to the couple.
Will
A will is a legal document that sets out your wishes for what should happen to your money, property, and possessions after you die.
Will Trust
A will trust (or testamentary trust) is a legal arrangement created through your will that comes into effect when you die, placing your assets under trustees' control to manage and distribute according to your specific instructions.
Will Writer
A will writer is a professional who helps people create wills but isn't necessarily a qualified solicitor, with varying levels of training, regulation, and consumer protection depending on their professional affiliations.
Wills Act 1837
The Wills Act 1837 is UK legislation that establishes the legal requirements for making a valid will in England and Wales, including signing, witnessing, and execution procedures.
Witness
A witness is an independent person over 18 who watches you sign your will and then signs it themselves to confirm they saw you sign it freely and voluntarily.
Woodland Relief
Woodland relief delays inheritance tax on the value of trees and timber until they're sold or given away, rather than charging tax when the woodland owner dies.