Day 12 - Twelve drummers drumming
Music Royalties - Ensuring the beat goes on for those your care about
The right to receive royalties from music, as for many other types of intellectual property rights, can be inherited as part of a person’s estate.
When a musician dies, the beneficiaries of their estate either named in their will or, if they do not have one, the beneficiaries determined by the rules of intestacy, will be able to receive the royalties throughout the period of copyright. This right currently lasts 70 years from the creator’s date of death.
As copyright has such a long term it is possible that rights to receive royalties can pass down through several generations. Where the intellectual property is of significant value, this can be directed to structures such as trusts during a creator’s lifetime or on their death to ensure that it is carefully managed by appropriate trustees for the benefit of a person’s whole family. Alternatively, a person with valuable intellectual property might consider appointing a literary executor with particular expertise in the relevant area, separately to the other executors of their estate.
People tend to focus on tangible and financial possessions when making their wills and can accidentally overlook valuable intellectual property such as copyrights, trademarks, designs, Artist’s Resale Rights or patents. This intangible property is often forgotten or not clearly and fully dealt with as part of someone’s estate planning.
If you have any intellectual property of significant value, it is important to get advice on the proper drafting of your will to ensure that all facets of the piece of original work or creation will be passed in line with your wishes on your death.
For example, although an item such as a painting may hold some value, it can be the case that the greater value is the intellectual property surrounding the painting. As such, intellectual property rights should be clearly defined and included in any gift of personal items where it is the owner’s intention that they pass with the physical item itself.
There can be several different intellectual property rights associated with a particular creation which can make dealing with these assets complicated. For example, copyright in a sound recording (lasting 50 years from when the sound recording was made if unpublished or 70 years from being made public within that period) exists separately from the works and performances included in that sound recording.
Having a properly drafted will that deals with your intellectual property can not only give peace of mind to the creator but also help prevent disputes after a person’s death as to the scope of any gifts in which intellectual property exists.
Another issue that can arise in respect of intellectual property is that people often do not keep good records of their creations, especially in an era where creations are often stored or created in the digital space. Therefore it is a good idea to keep a record of all works you have created and lists of any relevant experts or contacts who your executors will need to deal with after your death in respect of the works you have created.
Focusing attention on who will inherit your royalties can ensure your family continue the beat to the sound of your drum after you have passed.
Day 11 - Eleven Pipers Piping
Pipe to your own tune
Navigating your independence after a divorce or a separation is difficult for so many people, especially if they have become used to following their own ‘pied piper’ during a relationship.
You may not have realised it at the time, but when you’ve been with your partner for so many years, you can often lose your own identity and slowly change your lifestyle to fit in with theirs. It’s only when the relationship breaks down that you may come to realise that you’ve constantly been seeking your partner’s guidance or approval for so much of what you do. Their opinion has mattered so much to you that you’ve lived your life around it and lost a part of ‘you’.
When a relationship ends, your ex-partner’s opinion won’t matter any longer, you don’t need their approval and you can ignore the criticism. Do what you want to do - as long as it’s legal.
This is an ideal opportunity to find your freedom and embrace your single status. You can make new friends, find a new hobby, join a gym, change your job, or volunteer.
You can sing your own tune and let the pipers play elsewhere.
Day 10 – Ten Lords a Leaping
Setting up a charity – a legacy for those with Inherited and earned wealth alike
The recently published CAF UK Giving Report 2021 revealed that although the number of people giving to charities decreased in the last year, those that did were more generous. And there was a particular increase in the size of charitable donations amongst older adults.
As people with significant personal wealth get older and start to think about their legacies, as well as taking care of their own families, it appears that many look to provide assistance to those less well-off.
One of the ways that those with substantial wealth look to do this is through the setting up of a charity, either via their will on death, or during their lifetime.
Why set up a charity?
While a person may decide to leave individual gifts to charities under their wills or make regular gifts during their lifetime, those with more substantial wealth may instead choose set up a grant-making charity. This creates an ongoing legacy and ensures funds are managed to provide financial assistance to causes particularly close to their hearts for years to come.
Setting up a charity can have a number of tax advantages too, both for the individual and the charity. Most of the income and capital gains of a charity are tax-free and charities can also claim back the income tax that has been deducted from donations through the Gift Aid scheme.
From an estate planning point of view, gifts to UK charities on a person’s death can be appealing as they are free of Inheritance Tax. On top of this, if 10% of a person’s assets on their death are left to charities, the rest of the estate can qualify for a reduced rate of Inheritance Tax. This can, in certain circumstances, reduce the overall Inheritance Tax payable on a person’s death.
Setting up a structure to give back to worthy cases can be fairly straightforward through the creation of a charitable trust. However, those considering this should take advice on the most suitable structure given their circumstances, the kind of activities the charitable will be undertaking, and the assets the charity will hold.
The small print
It is important to remember that most charities other than the very smallest will need to be registered with the Charity Commission in order to be recognised by HMRC and gain the tax advantages that come with charitable status. Those setting up a charity need to be aware of the requirements and conditions of registration from the outset, when preparing their governing document and deciding on their objectives.
Although running a charity can be very rewarding, it is important that the administration and reporting requirements are fully complied with and the charity is properly managed.
If this is the route you would like to explore to ensure that your wealth is leaping into action for those less fortunate, the team can advise and assist with the setup and ongoing running of a charity and ensure that all taxation and reporting requirements are fully met with, allowing those that run the charity to get on with the work of benefitting worthy organisations and individuals leaving those charitable trustees leaping for joy!
Day 9 - Nine ladies dancing
Financial settlements – never a one size fits all
Every single family will have their own unique, different set of circumstances and these varied circumstances are always in evidence when family lawyers are looking at resolving financial claims for a separating couple. No two cases are ever the same in terms of a couples financial assets; property, savings, pensions, businesses, income, liabilities and so on.
Family lawyers must assess each case on its own facts, considering how those particular circumstances sit against the factors outlined in section 25 of the Matrimonial Causes Act 1973. These statutory factors are not equally weighted across all cases (although needs of any children and the parties will always be the priority factor). In some cases, the length of the marriage is relevant, perhaps the health of one of the parties, or one parties contributions to the matrimonial wealth.
The point is there is no magic formula to produce the “correct” outcome, which is why it is so important to take early and ongoing advice from a family law specialist when separating.
If you are fearful your partner may “waltz” away with the assets, leaving you in a tight spot, get in touch so we can “(American) smooth” away your concerns.
Day 8 - Eight Maids a Milking
Utilising Agricultural Relief
What is Agricultural Relief
Agricultural Relief (AR) is a form of inheritance tax relief that allows you to claim relief on land used for agricultural purposes, (crops or livestock) and associated buildings such as barns, outbuildings and houses used in connection with the land.
How does APR work?
To receive AR, the land or buildings must have been owned for at least two years prior to transfer. There is one exception to this rule - if the asset is inherited from a spouse and the combined period of ownership exceeds two years then AR relief should be available. If the owner does not occupy the property (land or buildings) which is the case usually with a Farm Business Tenancy they need to have owned it for seven years in order to qualify for AR.
What qualifies for Agricultural Relief?
Typically, AR is available for:
- Land used for crops or livestock
- Farmhouses – if certain conditions are met
- Cottages that have been lived in by someone working on the land and are under a tenancy agreement.
AR is not available for:
Machinery and farming equipment
Derelict buildings/outbuilding on land
How much AR is available?
Depending on how the property is owned relief is due at either 50% or 100%.
Agricultural Relief is a powerful form of tax relief and all options should be explored as it can provide relief of up to 100%. If your assets qualify for AR there’s no reason why your maids-a-milking shouldn’t be able to continue to do so following your death.
As with all areas of taxation, however, Agriculture Relief is a complex area and expert advice should be sought on estate planning.
Day 7 - Seven swans a swimming
How to cope with family tensions over Christmas
Retailers and marketers would have you believe that Christmas is a time of year we all look forward to – precious time off work, Christmas parties, giving and receiving gifts, the perfect Christmas with family - many of whom you do not see often at all.
Settling down to spend Christmas day together can be stressful and often doesn’t go to plan. So how can you survive the day? Here are a few tips to help you through.
Be mindful of what you say
Show respect towards your family and expect the same in return. Often tensions can arise because of brutal honesty or unsolicited advice. Consider your words carefully before you open your mouth and don’t say anything you would not like said to you.
If rifts exist already, they are not going to go away for Christmas day. Keep the conversation light and hope everyone finishes the day as happily as possible.
Let it go
This time of year can be stressful and someone will know what buttons to press to get a reaction so pick your battles wisely and perhaps save them for another day.
Your guest list
Playing the role of a referee at Christmas is not good for the mind or soul, so scale it down this year and spread it out. You don’t need to see everyone in one day. Different relatives on different days make for a calmer Christmas.
Focus on you
At a time of year when time is precious and there is the opportunity to take a little time off hopefully, remember that you do not have to do it ALL. It can help to delegate jobs on Christmas Day, which can include asking for help with food prep, washing up, assistance with childcare etc.
It can all seem a little overwhelming so focus on what makes you happy – and make plans accordingly. If there is an expectation (as there often is), make sure you have those conversations early so people know what is (and is not) happening.
Also remember the basics of self care, like good sleep, fresh air, and plenty of water, which will help with the inevitable excesses.
At a time of year when it can all get a bit frantic and you feel a bit like you are paddling for your life, remember the seven swans a swimming and try to slow down and glide through the festive season. You will come out the other side feeling calmer and ready for the new year.
Day 6 - Six geese a laying
Utilising Business Relief
What is Business Relief
Business Relief (BR) is a form of inheritance tax relief that allows you to claim relief on business assets, which can include shares in a qualifying business, providing certain conditions are met.
How does BR work?
If you are a business owner or have an interest in a business, your estate, upon your death, may be entitled to claim relief from inheritance tax (IHT) on these assets.
To receive BR, the business or business assets must have been owned for at least two years prior to death. There is one exception to this rule - if the asset is inherited from a spouse and the combined period of ownership between the two spouses exceeds two years, then BR relief should be available.
What businesses qualify for Business Relief?
Typically, BR is available for:
- A qualifying trading business or an interest in one
- Shares in an unlisted qualifying company, including a minority holding
- Shares in a qualifying AIM listed company
How much BR is available?
Depending on the type of business 50% or 100% relief is available.
Business Relief is a powerful form of tax relief and all options should be explored as it can provide relief of up to 100%. You should ensure your goose that lays the golden egg can continue to do so for the benefit of your family following your death.
As with all areas of taxation, however, Business Relief is a complex area and expert advice should be sought on estate planning.
Day 5 – Five gold rings
Can I keep my engagement and wedding rings?
When a couple goes through a divorce, the process of separating out the assets in the marriage can cover the basics, like the family home, savings, and pensions.
But when it comes to household contents, also known as ‘chattels’ this is an area that is best dealt with directly between the parties as costs can quickly escalate when this issue is negotiated through solicitors. However, when high value jewellery is involved, these items can cause conflict.
Wedding and engagement rings in particular can hold both monetary and emotional value, and the giver of those rings may believe that they are entitled to half the value, or even to have them returned.
In law, the giving of a ring is presumed to be a gift, and therefore it does not have to be returned. There may be an argument if an engagement is broken off, that the ring was given on the condition that it should be returned if the marriage did not take place. However, even though unfair, the recipient is not obliged to return it.
However, if the ring is of very significant value, this figure may be taken into account as part of the overall settlement.
So, whether you have just one or five gold rings from previous marriages, chances are they are yours to keep!
Day 4 – Four calling birds
The Dos and Don’ts of Social Media
When going through a divorce, it can be easy to be tempted to post about how we’re feeling on social media. After all, social media is part of our lives and in its best form, it can be a wonderful tool to connect, inform, and entertain people. However, it also has the opportunity to cause harm, distress and hurt and be used in a vindictive, spiteful and unhealthy way.
Remember – keeping things amicable is almost always the best route but if your inner calling bird is getting the better of you….take a deep breath and move away from the keyboard. Here are the do's and don'ts online.
Day 3 – Three French Hens
Providing for pets in wills
Most people know the importance of ensuring that they have a will in place, to provide for their loved ones after their death. However, many people have not considered their “non-human” loved ones and who will care for those furry family members after their human carer has died.
Although it may seem distasteful to some, legally speaking, pets are considered to be part of your personal “chattels”, like your clothes, car or your furniture, and will therefore form part of your estate when you have died. You should consider making provisions for what will happen to your pets in your will.
It is important to consider not only who you would like to care for your pets, but also the costs of caring for your pets and whether it may be appropriate to leave funds to those who will take on their care. However, it is essential to choose someone that you trust to ensure that not only will your pets be properly cared for, but also that any funds left to that person are used for the purpose for which they were intended. It is not possible to leave funds directly to a pet.
For those who do not have family or friends who would be able to take on the care of their pets, there are charities who will care of them, usually as long as arrangements are put into place beforehand.
It is therefore a matter that should be considered carefully and researched thoroughly, to ensure that your furry, feathery or even scaly family members will be properly cared for and that those French Hens will continue to live happily after your death.
Day 2 - Two Turtle Doves
Think about adding a pre-nup to your Christmas list this year
It is commonly recognised that two turtle doves are the symbol for love and friendship.
At Christmas time, many lovebirds decide to take the next step in their relationship and pop the big question. This is an extremely exciting time for couples and so it comes as no surprise that the more pragmatic things tend to get overlooked. For example, if you are entering a marriage with all of the wealth and your future spouse has very little in comparison, neglecting to have a pre-nuptial agreement is one crucial wedding item that could end up costing you thousands if not hundreds of thousands (or in some cases) millions of pounds!
Imagine working hard all of your life, accumulating a sizeable pension, a nice home and substantial savings and then picture having to split all of that 50:50 with a cheating ex-spouse. It does not bear thinking about, but sadly this is the reality for many people who enter into marriage without taking the necessary precautionary steps to protect their wealth prior to the big day.
Sure, a pre-nuptial agreement may not be the most romantic thing on the wedding “to-do” list, but it is something that will pay dividends later down the line, in the unfortunate event the marriage were to irretrievably break down and two turtle doves become single.
If you want further help, please see our pre-nup guide.
Day 1 - A partridge in a pear tree
Taking care of yourself this Christmas
For many of us, Christmas is a time for family celebrations – to relax, unwind, and spend our days enjoying the festivities along with a mince pie and a glass of something delicious.
But for others, Christmas is not the joyous time of year that marketing campaigns would have you believe.
Perhaps you’re going through a divorce, have been recently widowed, have strained family relations or are spending the holidays alone. Or perhaps you don’t celebrate Christmas due to your religion.
There are many different ways to spend your time during the festive period that don’t necessarily fit the traditional mould.
Let’s take a look at some alternative ways to spend Christmas:
Not everyone is having a great time at Christmas for all sorts of reasons.
That’s why volunteering can be so rewarding over the Christmas period. Not only is it beneficial for the person you’re helping, but is also a valuable use of your time and can help your wellbeing, too.
Here are a few different things you can do:
- Deliver food parcels
- Help at a soup kitchen
- Organise donations at a shelter
For an extensive list of volunteering opportunities in your area, visit Do IT | Connecting people to do good things.
Take Yourself Somewhere Memorable
Christmas doesn’t have to mean staying in. Draw up a list of quirky places you’ve never visited before. Most places indoors are closed, but there are many fascinating places of interest.
Join an online party or event
If you can’t leave the house for any reason, you can join a virtual party instead. There are plenty to choose from – just do a quick search online.
If you’re feeling in the mood for some Christmas-themed entertainment, you can join a virtual Panto online to take you back to your youth. Or why not try a virtual Carol service?
Become a house-sitter
Just like Kate Winslet and Cameron Diaz in The Holiday, you can use the festive break to house sit for someone else. It doesn’t cost a penny, and you can go and stay somewhere else.
You can either just house sit or pet sit, so you’ll be looking after a cute kitten or some adorable friendly dogs. Or perhaps, just a couple of monsteras or cheese plants.
For house sitting opportunities, visit House Sitting | TrustedHousesitters.com
Plan your perfect day
Although the media tells us that Christmas is a time for family and connection, in truth it can be whatever you want it to be. Instead, why not make the most of this time?
Plan out your perfect day to the hour – what you will eat, what you will watch, and how you will take care of yourself. Remember to add time for pampering and self-care too. Gather together some of the funniest comedy shows you have, arm yourself with some delicious food and drink, and get cosy on the sofa.
Reframe the narrative
Just because it might seem like everyone around you is spending time with other people, it doesn’t mean they are necessarily having a great time – it could be the opposite.
Think about how you can view the day in a different way instead – as an opportunity to relax or to eat food you enjoy. The day is completely yours so why not become the partridge in your very own pear tree!