Within Estate Plans the Asset Distribution screen can be used to set rules on how different assets in a plan are meant to be bequeathed to heirs.
Within one Estate Plan, an adviser may have several designated assets each with its own distribution rules. The heirs of an asset can be charity, person in the plan or person outside of plan.
How to set up an Asset Distribution in an Estate Plan
An Asset Distribution can be added when initially creating an Estate Plan (How to add an Estate Plan) or added to an existing Estate Plan.
This video will show you how to model an estate plan where the Will includes a gift of a specific asset to a particular beneficiary. Add an Estate Plan with Asset Distribution Video - UK
Alternatively, this guide will also show you how to model this.
-
Within the Estate Plan click Asset Distribution on the left-hand menu:
-
Click Add Distribution:
-
Select the asset(s) to be distributed using the Select an Asset dropdown. In this example the holiday home is being left to one of the children:Tip: if more than one asset is bequeathed to the same beneficiary(ies) select multiple assets using Select an Asset.
-
Input the proportion of the asset to go to each specified beneficiary in the Beneficiaries section:Notes: the sum of the breakdown must add up to 100% and the breakdown only applies to the Estate Plan owner's share of the asset e.g. if an asset is jointly owned, only half of it will be distributed according to the breakdown, the other half remains owned by the co-owner.Tip: ensure that you click Done in the Asset Distribution section before you click Done in the top-right corner.
- If there are other assets bequeathed to other beneficiaries, repeat steps 2-4 above until all of the specific bequests have been input.
-
In the Basics screen specify whether or not assets should be liquidated if there is an IHT bill to be paid (note that this setting only applies to IHT, assets may still be liquidated for other reasons, see Calculation Notes):
If set to No, the specified asset will be shown as transferred in the Legacy screen:
If set to Yes, the specified asset will be shown as liquidated in the Legacy screen:
-
Once completed, click Done in the top right corner to save the Estate Plan.
Which assets can be distributed using Asset Distribution?
The Select an Asset dropdown is populated with the assets in the plan which are available for distribution. These include savings, investments, annuities, and properties which are:
• owned or jointly owned by the owner of the Estate Plan,
• owned by a beneficiary of the asset,
• contingent inherited assets.
Tip: the list of assets will not include Investment Bonds, Pensions or Protection policies which have their own Beneficiaries screens in which to specify how they should be distributed on death.
Note: An asset can only be designated once. When it is added to a distribution, the asset is cleared from the selection dropdown. When the asset is removed from the distribution, it will once again, be added to the dropdown list of available assets.
How to check the Estate Plan is working as expected
Click Overview > Legacy to view the impact of the Estate Plan with Asset Distribution:
View the Detailed Legacy screen and the asset distribution can be seen in the Estate Distribution and Inheritance Tax section:
Calculation Notes
Assets are not liquidated unless there is a particular need such as paying a debt or taxes or if the liquidation timing was specified on the Asset Timing tab.
If an asset is not liquidated, it is transferred to the heirs according to the designation specified by the adviser. If the asset is liquidated, and after debts and taxes are paid, the liquidation funds are distributed to heirs per the distribution rules.