Published on: 23rd November 2020

The impact of Covid-19 on Estate Planning

The global Covid-19 Pandemic has caused a wide range of unforeseen problems for many people and it has certainly had an impact on Estate Planning. There have been several different ways Covid has impacted Estate Planning not least because the increase in deaths (Covid related or not) has resulted in an increasing number of Estate Administration cases.

There are a number of other ways Covid has impacted Estate Planning as we detail below:

Long-term health consequences

One Covid problem which is not discussed very often is ‘Long Covid’. This can take a number of different forms but can have serious long-term consequences for the health of an individual. If these consequences lead to serious long-term illnesses then it highlights the importance of having a Lasting Power of Attorney document in place, particularly as we do not know the impact ‘Long Covid’ will have many years from now. Good Estate Planning at this stage can mitigate the risk of serious problems later on.

As well as Long Covid, many people have been less active over the lockdown period so there have been more heart related deaths as well as an increase in Obesity and Diabetes. These health factors highlight how important Estate Planning is as something like a heart attack can occur suddenly and with so many hurdles for a family to overcome in the aftermath, having a good Estate Plan in place can at least relieve some of the stress as it is one less thing to worry about.

Communicating

Covid has forced many high street businesses to shut, and it has also forced many bank branches to close as staff levels are reduced. This can be a real problem for those who are older and rely on their local branch being open. Perhaps they struggle with talking on the phone which is why they like to go in and speak to someone face to face. In a situation like this, Lasting Power of Attorney documents can help someone act on behalf of an individual. We have no idea how long we will be in and out of lockdowns  so if you have struggled with communicating over the lockdown period then now is the time to act and ensure you are not left in the same position again.

Benefitting from the circumstances

Although the negatives of Covid far outweigh the positives, there are ways in which you can use the current situation to your advantage from an Estate Planning perspective. These include:

• Business succession planning – Do you own a family business and are thinking of passing down shares to the next generation at some point? If you are then now may be a very good time to look at this as shares may not be as valuable as they had previously been.
• Gifting assets – Do you have assets that you want to pass on? If you do then now may be a good time to gift these as, due to the current economic situation, they may not be worth what they otherwise would be. If standing at a loss, these could be gifted without a Capital Gains Tax charge.
• Use a trust – You could use a trust for an asset if it has fallen under the current £325,000 nil rate band. This gift would then not incur any Inheritance Tax charges and you will effectively remove this gift from Inheritance Tax charges if you live longer than 7 years from the date of the gift.

So what should you do?

Many people will have a Will in place and feel that covers everything it needs to from an Estate Planning perspective. As we have discussed in this article, there are many more important documents that you need to at least consider having in place for unforeseen circumstances, and if 2020 has taught us anything it’s that you can never predict where you will be in 12 months’ time!

Here at Casey & Associates we make sure that Wills and Estate Plans are regularly reviewed and offer all Clients a free, no obligation, 3 yearly review. Our proactive approach has ensured many important documents are in place for our Clients, which has been especially important during the global Covid-19 Pandemic.

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Our Covid-19 policy is now that if you wish to give instructions or require general information about our Wills, Lasting Powers of Attorney or Trusts then we will carry out a telephone or Zoom appointment. However, if you wish to give instructions to one of our Consultants and you feel that you can only do this at a Face to Face meeting we are offering, at our Consultant’s discretion, a limited number of Face to Face appointments in most of the areas we normally cover (subject to Government advice). To see the areas we normally cover please click here.

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