Explore key terms and concepts for Estate Planning, Inheritance and Care Planning below.

Will – A legal document setting out how your estate is distributed after death.

Codicil – A formal amendment to an existing will.

Letter of Wishes – A non-binding document guiding executors/trustees on personal matters (e.g., funeral wishes).

Lasting Power of Attorney (LPA) – A legal document appointing someone to make decisions on your behalf while you’re alive (separate types for Health & Welfare and Property & Financial Affairs).

Grant of Probate – Court-issued authority allowing executors to administer an estate (when there is a valid will).

Letters of Administration – Court-issued authority for administrators to manage an estate (when there is no will).

Death Certificate – Official registration of death; required to start probate and manage estate affairs.

Trust Deed – A legal document creating and governing a trust.

Deed of Variation – Allows beneficiaries to change the distribution of an estate (within 2 years of death).

Testator/Testatrix – The person making the will.

Executor – Person(s) appointed in a will to administer the estate.

Administrator – Person appointed by the court to manage an estate without a will.

Beneficiary – Individual or organisation inheriting from an estate.

Trustee – Person(s) responsible for managing a trust.

Guardian – Person appointed to look after minor children if parents die.

Attorney – Someone appointed under a Power of Attorney.

Personal Representative (PR) – General term for executors and administrators.

Probate – The legal process of proving a will and administering the estate.

Intestacy – When someone dies without a valid will; estate is distributed under UK intestacy rules.

Estate Administration – Collecting assets, paying debts/taxes, and distributing inheritance.

Estate Account – A record of estate assets, debts, income, and distributions.

Residuary Estate – What’s left after debts, taxes, and specific gifts are settled.

Specific Gift / Bequest – A defined gift left in a will (e.g., “my wedding ring to my daughter”).

Pecuniary Legacy – A gift of a specific amount of money.

Intestate Heirs – Relatives entitled to inherit when no will exists.

Inheritance Tax (IHT) – Tax on an estate above certain thresholds.

Nil Rate Band (NRB) – The threshold (£325,000 as of 2025) below which IHT is not payable.

Residence Nil Rate Band (RNRB) – Additional allowance when passing on the family home to direct descendants.

Annual Exemption – £3,000 per year that can be gifted free of IHT.

Small Gifts Exemption – Up to £250 per recipient per year without IHT.

Seven-Year Rule – Gifting rule: gifts made more than 7 years before death are usually exempt from IHT.

Potentially Exempt Transfer (PET) – A lifetime gift that becomes tax-free if the donor survives 7 years.

Chargeable Lifetime Transfer (CLT) – A gift into certain trusts which may trigger lifetime IHT.

Business Property Relief (BPR) – Reduces the value of business assets for IHT purposes.

Agricultural Property Relief (APR) – Reduces the value of qualifying farmland/property for IHT.

Bare Trust – Assets held for a named beneficiary who becomes entitled at 18.

Discretionary Trust – Trustees decide how/when to distribute assets.

Life Interest (Interest in Possession) Trust – Beneficiary entitled to income for life, capital passes later to others.

Charitable Trust – Assets held for charitable purposes.

Settlor – The person who creates a trust.

Trust Fund – The assets held within a trust.

Estate – The total of a person’s property, money, and possessions at death.

Joint Tenancy – Property ownership where the survivor automatically inherits the deceased’s share.

Tenancy in Common – Property ownership where shares pass under the will/intestacy, not automatically to co-owner.

Chattels – Personal possessions such as jewellery, furniture, or vehicles.

Residuary Estate – The “remainder” after debts, expenses, and gifts.

Digital Assets – Online accounts, social media, digital currencies, etc.

Life Insurance – Policy that pays out a lump sum on death; can help cover IHT or provide for dependants.

Pension Death Benefits – Pension funds that may pass to beneficiaries, often tax-efficient.

Trustee Investments – Investments made by trustees on behalf of beneficiaries.

Gift with Reservation of Benefit – Asset given away but still used by the giver (e.g., giving away a house but continuing to live in it) – usually ineffective for IHT planning.

Contested Will – When a will is challenged in court.

Lack of Capacity – Claim that the testator did not have mental capacity when making the will.

Undue Influence – Claim that the testator was pressured into making provisions.

Inheritance Act Claim (1975 Act) – Allows certain dependants to claim “reasonable financial provision” if excluded.

Caveat – A formal notice preventing probate from being granted until a dispute is resolved.