Gifts in a Will

There are normally 3 general types of basic gift in a Will, specific gifts, pecuniary gifts and residuary gifts.  These have various sub-categories but we advise you seek proper advice on these as they are more complicated than there is space to explain here.

A specific gift is one where a specific item or class of items, such as for example a family heirloom, is left to a specific person or group of people.  Problems can arise where the gift is not adequately defined or has been sold or otherwise disposed of prior to death.

A pecuniary gift is a specific sum of money.  It can be a specific amount to a specific person, an amount split between a class of persons, a specific amount split between a class of persons or any combination of these.  Problems can arise if there are insufficient assets to pay these.

The residue is what is left after any specific or pecuniary gifts have been made from the estate and all expenses and taxes have been paid.  A residuary gift is usually a share in the residue.  The gift may be on trust (i.e. have conditions attached) or absolute.

Unless the Will states otherwise, any gift passes free of tax.  This means that any tax must be paid by the estate and comes out of the residue before this is distributed.

A gift can create an absolute interest (it is yours to do whatever you wish with), a life interest or interest in possession (it is yours for only as long as you are alive) or an interest on trust (you are entitled to the benefit but someone else, known as the trustee, decides how you should have this).  Where the gift is to a class of people then it can vest immediately, be deferred to a later date or be contingent (e.g. be for children of a certain person who reach the age of 18).

For Wills made prior to 1970 any gift to children is deemed to only include legitimate children unless the Will states otherwise.  For Wills made from 1970 onwards gifts to children include both legitimate and illegitimate children. An adopted child is regarded as a legitimate child.

Generally you have to survive the person who made the Will to receive any inheritance.  Where any gift in the Will fails for whatever reason it can either pass elsewhere if rules or the Will provide for this or it falls into the residue.  If a residuary gift fails then the assets may fall to be dealt with under the intestacy rules.

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