Statutory Wills & Gifts
If someone lacks capacity, it is possible for the Court of Protection to authorise a Will to be made or amended or a gift to be made on behalf of someone who lacks capacity.
The application process can be lengthy and costly. Therefore, seeking advice and assistance at an early stage is strongly recommended.
The Court of Protection will consider emergency applications where the matter is serious and there is an unavoidable time limit, such as where a Statutory Will is required and the individual involved may be close to end of life.
All applications need to be in the best interests of the incapacitated person. The Court will not necessarily authorise a Statutory Will or Gift to be made simply as a tax-planning exercise.
Situations where an application for a Statutory Will should be considered may include –
- Making a new Will because all the beneficiaries in the current Will have died.
- Removing beneficiaries for good reason, e.g., theft from the person who lacks capacity.
- Including beneficiaries who would be excluded from benefitting under the Intestacy Rules.
- Severing the joint tenancy of a property so the benefit can be left to family members.
Application for a Statutory Will is usually made by the incapacitated person’s Deputy (if they have one) or their Attorney. The Official Solicitor will act on behalf of the incapacitated person. They ensure that whatever actions are taken are in the best interests of the incapacitated person.
The Statutory Will only comes into effect on the death of the incapacitated person. Advice should be sought if an application for a statutory Will is being considered.
It is possible to make application to the Court of Protection for a gift from the incapacitated person to be approved.
A Deputy or Attorney has extremely limited power to make gifts from the assets of the incapacitated person. Any gifts the Deputy or Attorney makes must be reasonable and proportionate. This means that the amount of the gift must be reasonable considering the overall size of the estate of the incapacitated person.
Any gifts exceeding the reasonable and proportionate threshold need to be authorised by the Court of Protection. Again, the application can be time consuming, and the Official Solicitor will be involved.
A Statutory Gift application may be considered where –
- Gifts were made before the person lost capacity and a gift is proposed to ensure family members are treated equally.
- Providing for someone connected to the incapacitated person.
- Paying a family member to provide care.
When Deputies and Attorneys are considering gifts, extreme caution needs to be exercised. It is recommended to seek advice before making gifts to ensure that what is proposed is compliant with the rules and that an application is made in good time if required.
The application process
Whether an application is being made for a Statutory Will or a Statutory Gift, the process is similar.
The person making the application needs to show what authority they have to act, such as a Deputyship Order or Lasting Power of Attorney.
For the Court of Protection to consider an application, the person concerned must lack capacity. An Assessment of Capacity form (COP3) needs to be completed, usually by the incapacitated person’s GP or a medically qualified person.
To help reach a decision, the Court of Protection will need details of the person’s estate and assets, their estimated income and outgoings and details of whether there will be increased Inheritance Tax, Capital Gains Tax, or Income Tax payable as a result of the proposed gift or Statutory Will being approved.
A witness statement needs to be made in support of the application. The application needs to take into consideration what the person would do if they were able to make the Will or gift themselves, their beliefs and personal values and how they have acted and made decisions for themselves in the past.
Any decisions taken on behalf of the incapacitated person must be in their best interests, even if it conflicts with the interests of others.
Our experienced team is on hand to assist you.