Estate planning is an important and everlasting gift you can give your family. And setting up a smooth inheritance isn’t as hard as you might think
Whether you are an individual owning a house, an insurance policy, a few fixed deposits, some mutual fund investments, an industrialist with vast estates or you have properties and financial assets to your name.
You ultimately have to hand over your possessions to somebody; it may be to your legal heirs, in charity or to anybody else. How do you ensure that after your death, your property does go to the intended person and not wind up in someone else’s hands? Well, the easiest way to make sure of this is to create a Will. However, what are the salient points that you should keep in mind while making a Will?
Ten points that must be kept in mind while making a Will:
- Succession planning:
- Can be done through Wills, corporate entities and trusts.
- A Will is a testament. It declares the objective of the person concerning his or her assets; which he or she wants to be executed, after death.
- If one dies without making a Will, (called ‘intestate’ in legal jargon), his or her wealth is inherited by the heirs according to the inheritance laws.
- A Will succeeds inheritance laws, but only for the property
which is exclusively owned by (vested in) the departed.
- The rest of the assets are liable to the applicable succession laws.
2. Legally, it is important
- Legally, it is important to make a Will on a stamp paper and
register with the court. (referred to as Registrar/Sub-registrar).
- My Advocate friend mentioned that it is although very much advisable to restrict challenges during the execution of the Will.
- Legally, it is important to make a Will on a stamp paper and
3. Looking at your family
- Whether these may be your assets or liabilities, your income or your expenses, it is a myth that if one dies without making a Will, all the assets like the property or bank account, shall be automatically inherited by the person’s spouse and hence there is no need of making a Will.
- In India, the Hindu Succession Act defines the course of action for the inheritance for Hindus; if one dies without leaving a Will.
4. Preparing a Will
A Will may have different components and different variations and different templates for different purposes but Will have some common steps. These steps are:
- The name of the person who is writing the Will
- The address
- Date and time of writing the Will
- A declaration from your doctor confirming that: “as on that date, you were of sound mental health.
5. Signing the Will
- Once you have completed writing your entire Will, and after following the above steps, you must sign the Will in the presence of two independent eyewitnesses, who should be signing the Will in your presence.
- The place and the date of signing this Will should be explicitly mentioned at the bottom of the Will, and all the pages of the Will must also be signed.
- Choose two witnesses like your friend, your neighbour, your colleague but should not be one of the beneficiaries.
6. The Executor of the Will:
- You also need a person called as the executor; an executor is a person who Will execute the Will, when you are no more (He or she is responsible for getting the court order) and will ensure that all the beneficiaries you have mentioned in your Will, get the benefits.
- It is a good idea to mention the amount or the percentage to be paid by your family to the executor. This is necessary to execute the Will. Moreover, it is essential for his or her services in advance.
- It is to be noted that it is not legally required to get the Will executed in the court of law as the Will can be executed in the presence of a magistrate or even a public notary.
7. Execution of the Will:
- In order to get the Will executed, your executor has to get, what is called A probate is a certified copy of the Will, from the court of law.
- This process may take a few week or months, depending onthe state and the city.
- The cost of getting this done, the other legal fees and stamp duty if necessary, should also be kept in mind.
- However, probate is not required for immovable properties of Hindus, but a Succession Certificate is required, except if the property is located in West Bengal, Mumbai and Chennai.
8. Registration of a Will:
- If you wish to get a Will registered, you Will have to visit the registrar’s office, along with your witnesses.
- A Will can also be registered, by the executor or any beneficiary after the testator’s demise.
- There is no stamp duty for registration of a Will, but there is a nominal fee, which may vary from state to state.
- However, getting a Will registered means for changing or cancelling it, you will have to visit the registrar’s office, and subsequent testament will also have to be registered.
9. What if you don’t have a Will
To put it simply, if you don’t have a Will –
- Distribution of your asset will be done, according to your religion’s law and Indian law.
- The court will appoint someone to distribute or manage your asset or take care of your minor children.
- Asset related family disputes could arise.
- You will, perhaps, not be lovingly remembered, if your asset cannot be easily transferred, or if there is a dispute.
In your Will, you can give or bequeath.
- everything you bought from your income.
- an asset that you inherited without conditions on the future use.
- your share of every other asset.
10. Some Myths related to Documentation of a Will:
- I am not able to decide my assets and liabilities!: Your financial planner can be a good guide to help you decide what your assets, liabilities are and who should be given what benefits as your nominees; for example, insurance policies to take care of your loan and your mutual fund to take care of your children’s education.
- Only when I am old and about to die, I will make a : You do not have to wait for your last breath to decide to write a Will.
- I will have to spend a hefty amount on hiring an advocate to make a : No, it is not a big expense to make a Will or hire an advocate to make a Will.
- My wife knows all about my properties, and she will get them transferred : True, but she may not know about everything.
Now, with these 10 points demystified, you might have got clarity on Will. Let us learn a few more rarely-talked facts about a Will.
- Who will take care of your children in the absence of you and your spouse:
One can write a Will by appointing a trusted person as the guardian of their children when neither of the parents survives.
- One can also write a Will for creating trusts.
- The succession of a property is governed by complex laws of inheritance and religion, as well as customs.
- The laws also differ for men and A Hindu (which also includes Jains, Buddhists and Sikhs) man can write a Will for any property earned and owned by him.
- A person cannot include those assets, which are not legally transferable in his For inherited property, a Hindu man can only distribute his share in the property through a Will.
When I talk about these critical responsibilities with my clients, some of them look at me with long faces. I know, no one wants to die, but the Universal truth is that no one has been able to escape death either. At the same time, some clients feel amused upon being apprised of these responsibilities. They take my suggestions positively and practically.
Let me ask you a question:
Let’s say you are about to step out of your house. When you look at the sky, you predict that it is likely to rain today. What do you do at such time?
You take an umbrella with you! Simple!
Similarly, these duties are your umbrella, maybe not for you, but your loved ones. And this is what compelled me to include this module in this book.
Checklist for WILL drafting and registering:
- It is good to have 2-3 executors for your Preferably of a younger age to you. One executor to be an outsider who can give an un-biased opinion or be rational on the matters.
- 2 witnesses are compulsory and while registering the will they have to be present in the court.
- Witnesses have to carry their PAN card, Aadhar card and 2 photos.
- The person making the will requires a certificate from an MBBS Doctor just 2 days prior to registering the will, mentioning that the person is of sound mind and mentally fit.
- The person registering the will has to carry PAN card, Aadhar card, Passport, Ration card, and 2 photos.
- The will can be executed on a `100/- stamp paper or on a plain paper too.
- Mention all the points clearly and in simple language.
- Different scenarios and circumstances can be mentioned in your will.
- Kindly attach the Annexures, if any.
- Get the stamp paper issued in your name, if possible.
So, play safe and stay happy!