Legacies in wills and probate explained
31 March 2021
A legacy is a gift that you leave to someone in your will. The term 'legacies' comes up when you're making a will or going through the probate process.
Legacies in Wills explained
When you write a will, you'll be asked whether you would like to leave any legacies, otherwise known as gifts.
There are different types of legacy, and it's useful to understand some of the most common. These include:
A pecuniary legacy, which is when you leave a fixed sum of money to a particular person. For example, you might leave £1,000 to your cousin Michael.
A specific legacy, which is when you want to leave a specific item to a specific person. For example, you might want to leave your engagement ring to your granddaughter Sarah.
A charitable legacy, which is when you leave a gift to charity in your will. Gifts to charity are exempt from inheritance tax.
A residual legacy, which is when the rest of your estate is left to certain people. These beneficiaries will receive the 'residue' of the estate, which is what's left after tax, debts and other legacies have been paid. If you're leaving residual legacies to multiple people, you'll need to say what percentage each person gets.
When you make a will, you need to think about the legacies you would like to include. Are there any sentimental items that you want to leave to a particular person? Would you like to set aside money for a family member, friend or charity? Who do you want to receive the rest of your money and assets? And will your residual beneficiaries receive equal or unequal shares?
These are all things that you must decide when making a will. If you're unsure about anything, our wills advisors can explain legacies in wills in further detail.
Legacies in probate explained
When someone writes a will, he/she will also be given the opportunity to name executors. These are the people responsible for administering their estate after they die.
If you are the Executor of a will, it's your responsibility to make sure the gifts that have been included in the will reach the beneficiaries. This is one of the many duties of an executor.
The executor might need to apply for a legal document called a grant of probate before they can administer the estate. Once they have this document, they can pay any outstanding debts on the estate and then distribute the rest of the estate to the beneficiaries, according to the terms of the will.
When legacies fail
In some situations, a gift in a will could fail. This means that the item referred to was no longer owned by the deceased when they died, so wasn't theirs to give away.
Take the engagement ring that was supposed to be left to the granddaughter named Sarah. If this had previously been lost, sold, stolen or given away, the item will no longer be in the estate to give to Sarah. Sarah would receive nothing in these circumstances.
Alternatively the deceased might have made more legacies than they could actually afford. Sometimes this happens when a person writes their will based on how much money they have at the time, but then have significantly less by the time they die. If this happens and there isn't enough money in the estate to cover the pecuniary legacies, everyone who is due to receive a pecuniary legacy must have their gift reduced in equal proportions. This is called abatement.
Or if the estate is insolvent, this means there isn't enough money to cover tax, debts, administration expenses and all the legacies. If an estate is insolvent, the debts must be paid back in a particular order. The residual beneficiaries are at the bottom of the list.
Get help with distributing legacies
Therefore distributing the legacies in a will may not be as straightforward as it seems. That's why some executors choose to instruct a Probate Solicitor to carry out the process on their behalf. Probate and estate administration can be full of legal complexities. If you are an executor and you get it wrong, you could be found personally liable.
With our Probate Complete Service we take full responsibility for obtaining grant of probate and dealing with the legal, tax (not VAT), property and estate administration affairs*.
*We can pay all the costs of a Co-op Funeralcare funeral when you use our Probate Complete Service, and the estate has sufficient financial assets which can be sold in due course to repay our costs.