Allegedly there has been a celebrity death spike; Ronnie Corbett, Prince and Bowie to name but three. After the unexpected death of a celebrity there is a period of mourning; a sense of remorse that the deceased, with whom they have become so familiar, will never be seen again.
As someone who has been in the death and taxes business for most of my working career, it never ceases to surprise me how little attention is paid to the inevitability of death. My mother lived through the war in Holland surrounded by death and starvation; I asked her what it was like. Her response was ‘one never sees people die, they disappear quietly into their own homes and are just not seen again’.
We have a strange attitude towards death in our Western world. As a child I was sometimes persuaded to engage in a game of cowboys and Indians which I did not enjoy ‘bang, bang your dead’ and you were then expected to die in a realistic manner, as seen on TV. Things have not much changed. We are all immune to death. It is on the news every day, bombing and natural disasters and we enjoy it as part of our entertainment, whether fictional or documentaries. We are so exposed to it we are not aware of it. And then little Ronnie dies and we are shocked. He is supposed to laugh and pop up again – but we know he won’t.
Just as nothing prepares us for being a parent, nothing prepares us for death. Religion is of little practical help. Hell and brimstone would appear to be a human ploy to fill our churches and pay for the clergy, but it does little to inform us how to live our everyday lives, how to bring up our children or how to prepare for death
What is death even? Seemingly our body becomes ‘lifeless’, like a musical instrument which has been discarded by the musician and not required in the orchestra. We fictionalise death just as we would prefer to caricature it so that we can ignore it – until someone we know dies – such as a celebrity, friend or family relative and then we are shocked and saddened – until we can forget about it again.
Beneath the everyday veneer of an acceptance of death, in reality we are scared of it; we put off making plans superstitious that the grim reaper will come once we are ‘ready for him’. So rather than make arrangements should death pop up sooner than expected most of us prefer to put our head in the sand hoping it will go away.
Succession is an art and planning a skill. It cannot be learned from a book and must be taken very seriously. Succession is the distribution of the fruits of a lifetime to nearest and dearest, at a time when you are not there to ensure things are done properly. Your estate planner should therefore be the best money can buy; it is not something to do on the cheap.
Last week John showed me a draft of his Will. He and his wife Janet had taken local advice, but he was not convinced it was what he wanted, but could not put his finger on why.
Under the drafts prepared for them each left their estate to the survivor in trust as executor and trustee to distribute as they considered best. This is a very commendable plan for a married couple who have not been married before and do not have children by a former partner. In the case of John and Janet however, they had both been married before and both had children from former relationships. If they had executed these Wills and John had died first, Janet his wife would be able to benefit her children to the exclusion of his children from John’s estate. He was furious, that was certainly not what he wanted.
Estate planning should also take care to minimize family disputes. Josh also came to see me last week; he has a trust in Guernsey which holds many millions of pounds. Under the trust deed all three of his children were mentioned, but he was adamant that he wanted only two of his three children to benefit. However there was not power in the trust deed to remove his third child, Ben, as a beneficiary. He was fearful that following his death Ben would litigate against the trustees for a share. After some considerable discussion Josh decided that he could minimize the risk of a claim from Ben at the same time as save tax if he terminated the trust, brought the assets onshore and under his control.
Josh was so pleased. ‘The last thing I thought I would do was to terminate the trust. It had been engrained into me that it was a good for tax reasons, but as soon as I realized I could plan in other ways and be certain that Ben would not benefit I was much happier,’ he said.
If you would like to meet with me or any one of our team, whether for tax or estate planning, dispute resolution, matrimonial or investment strategy simply email svetlana@garnhamfos.com or call 0203 740 7423 to book an appointment.