The basics of estate planning remain unchanged, but Covid-19 has inevitably forced some temporary measures to be adopted, with aspects of the changes and people’s mentality likely to be lasting.
Will Signing – Emergency Changes
There has been a temporary change to enable a Will to be validly executed where the two required independent witnesses are present by video call instead of in person.
Scotland announced its emergency powers in April 2020 to allow for remote witnessing, but in England and Wales, this took until 25th July 2020 for a similar announcement to be made. The legislation for England and Wales is retrospective to 31st January 2020 and will, unless altered, remain in force until 31st January 2022.
This is the biggest change to the formalities of Will signing in the best part of 200 years, but the view of most professionals is to treat this option with caution. The video call should ideally be recorded in order to clearly show the testator signing their Will. However, this is only too easy to capture unclearly. In addition, there is a particular danger of a later accusation of undue influence if someone else is present but is simply out of the camera’s view. Although as a measure of last resort, this has been invaluable in allowing the opportunity to see a client, when it has been impossible otherwise.
Forward planning and ensuring the right documents are in place
Covid-19 has prompted individuals of all ages to consider the impact on their normal freedoms, issues of mental and physical incapacity and their mortality.
Increased difficulties have arisen when someone has been isolating, shielding, in a care home or in hospital during the pandemic. This is hopefully a temporary and an unprecedented situation, but it does emphasise the importance of making arrangements for documents such as Wills and Powers of Attorney in good time. This would invariably avoid a lot of stress and anxiety for the person in the future.
Choosing the right individuals
Another issue, which the pandemic has highlighted, has been the importance of choosing your executors, trustees and/or attorneys wisely.
Wherever possible, we recommend that more than one person is appointed and/or there is a substitute. Choosing individuals from different households has, in some cases, proved to be invaluable. This is especially true in the case of attorneys where one attorney has been unable to act temporarily such as when required to self-isolate. Attorneys are appointed so they may act separately if required.
Sadly, we have seen increased deaths too. Choosing someone from a different generation, even if they are substitute for the relevant role, can be important.
Covid-19 has not altered the fundamentals of tax planning especially when it comes to inheritance tax. Good forward planning has always been important but the situation since early 2020 has shown how vitally important this is because a good deal of effective planning does not yield immediate inheritance tax benefits.
A move towards electronic applications and access?
There was already a move towards simplification by the Government and government bodies which implements this. It has been accelerated by Covid-19 with varying degrees of success, however.
The implementation of the electronic application process for a grant of probate at the Probate Registry and applications to register Lasting Powers of Attorney (LPAs) at the Office of the Public Guardian, in our experience, have received mixed reviews.
Aspects of forms can be completed online and, in the case of LPAs, organisations can check these newer registered LPAs if the option of electronic registration is taken up. The problem is that these systems are still very much in hybrid form and paper documents are still required, in part, or in full.
There have been hiccups and issues, which have caused a great deal of delay, especially at the Probate Registry which has been attempting to centralise the process rather than individuals and solicitors dealing with local District Registries directly. So far, our overall experience has not been positive, but, in time, these measures are likely to streamline the process. That is provided that feedback is taken on board and improvements made.
We are now hopefully navigating our way out of this pandemic and there can be optimism for the future.
Many of the measures we have all had to endure are, hopefully, once in a lifetime events. However, Covid-19 has been a driving force to encourage the use of technology and brought into sharp focus the importance of having appropriate legal documents in place.
It is now also over to the Government and government bodies to continue modernising the system we use and making them more efficient for today’s world.