Estate planning glossary
Every confusing term, explained in plain English — so you know exactly what you’re reading and what you’re paying for.
A
Abatement
The reduction of gifts in a will when there aren't enough assets to pay them all in full. Happens in a specific order.
Administrator
A person appointed to manage an intestate estate (no valid will). Similar to an executor but appointed by the court, not chosen by the deceased.
Advance Decision / Living Will
A legal document refusing specific medical treatments in advance, for when you can't communicate. Different from LPA but works alongside it.
Attestation / Attestation Clause
The witnessing process for a will, or the clause confirming the will was properly signed and witnessed. Proves the will is valid.
Attorney (LPA)
A person you appoint in an LPA to make decisions on your behalf. They must act in your best interests and follow the LPA's terms.
C
Capital Gains Tax (CGT)
Tax on profit when you sell or give away assets that have increased in value. Different from inheritance tax and has its own exemptions.
Certificate Provider
An independent person who confirms the donor understands the LPA, is not being pressured, and no fraud is involved. Required for every LPA.
Codicil
A legal document that makes changes to an existing will without replacing it entirely. Must be signed and witnessed like the original will.
Court of Protection
A specialist court that makes decisions about people who lack mental capacity. Appoints deputies and resolves LPA disputes.
D
Deed of Variation
A legal document that changes how an estate is distributed after death. Beneficiaries can redirect their inheritance to others, potentially saving tax.
Deprivation of Assets
Deliberately reducing your wealth to qualify for means-tested benefits like care home funding. Local authorities can ignore such gifts.
Deputyship
Court-appointed authority to make decisions for someone who has lost mental capacity and doesn't have an LPA. More expensive and restrictive than LPA.
Discretionary Trust
A trust where trustees decide who receives what from a pool of potential beneficiaries. Offers flexibility but has specific tax rules.
Donor (LPA)
The person who makes a Lasting Power of Attorney and grants decision-making authority to their chosen attorneys.
E
Estate
Everything a person owns at death: property, money, investments, possessions, and any debts. The estate is what gets distributed through probate.
Executor
A person named in a will to manage the estate after death. They collect assets, pay debts and taxes, and distribute inheritances to beneficiaries.
G
Gift with Reservation (GWROB)
A gift where you continue to benefit from the asset. The gift doesn't work for inheritance tax - the asset stays in your estate.
Grant of Probate
The legal document issued by the Probate Registry confirming the executor's authority to deal with the deceased's estate.
Guardian
A person appointed in a will to care for your minor children if you die. Has parental responsibility until the child turns 18.
I
Inheritance Tax (IHT)
Tax on estates above £325,000 when someone dies. Currently 40% on the excess, with exemptions for spouses and some gifts to charities.
Intestate / Intestacy
Dying without a valid will. The estate is distributed according to intestacy rules, not your wishes. Also describes estates and the legal process.
L
Lapse / Failed Gift
When a gift in a will fails because the beneficiary dies before the testator. The gift falls into the residuary estate unless the will provides otherwise.
Lasting Power of Attorney (LPA)
A legal document letting you appoint someone to make decisions on your behalf if you lose mental capacity. Two types: Health & Welfare and Property & Financial.
Letters of Administration
Legal document giving authority to administer an estate when there's no valid will. Issued to administrators rather than executors.
Life Interest Trust
A trust giving one person the right to benefit from assets during their lifetime, after which the assets pass to other beneficiaries.
M
Mental Capacity
The ability to make a specific decision at a specific time. Someone lacks capacity if they can't understand, retain, use information, or communicate their decision.
Mirror Wills
Two wills where each partner leaves everything to the other, then to the same ultimate beneficiaries. Common for married couples with shared wishes.
Mutual Wills
Wills with a binding agreement that neither partner will change their will after the first death. Provides certainty but limits flexibility.
N
Next of Kin
Your closest living relative(s). Important for intestacy, but next of kin has no automatic legal rights - they're often contacted for medical decisions.
Nil-Rate Band (NRB)
The amount you can leave without inheritance tax - currently £325,000. Unused allowance can transfer to a surviving spouse.
P
Pecuniary Gift / Legacy
A gift of a specific sum of money in a will, such as "£10,000 to my niece". Paid after debts but before the residue is distributed.
Per Stirpes
A Latin term meaning "by branch". If a beneficiary dies before you, their share passes to their children instead of being redistributed.
Personal Representative
The legal term covering both executors (with a will) and administrators (without a will). They manage the estate after death.
Potentially Exempt Transfer (PET)
A gift to an individual that becomes exempt from inheritance tax if you survive 7 years. If you die within 7 years, it may be taxed.
Probate
The legal process of administering a deceased person's estate. Involves validating the will, paying debts, and distributing assets to beneficiaries.
R
Residence Nil-Rate Band (RNRB)
An extra £175,000 inheritance tax allowance when leaving your home to direct descendants. Can double to £350,000 for couples.
Residuary Estate
What remains of an estate after debts, taxes, expenses, and specific gifts are paid. Usually the bulk of what beneficiaries inherit.
S
Settlor
The person who creates a trust and transfers assets into it. In will trusts, this is the person who died (testator).
Specific Gift / Specific Legacy
A gift of a particular item in a will, such as "my diamond ring" or "my car". Distinguished from cash gifts or shares of the estate.
Statutory Will
A will made by the Court of Protection on behalf of someone who lacks mental capacity. Requires court approval and must be in the person's best interests.
Survival Clause / Survivorship Period
A will clause requiring beneficiaries to survive the testator by a specified time (often 28 days) to inherit. Prevents double taxation.
T
Tenants in Common
A way of owning property jointly where each owner has a distinct share that can be left in their will. No automatic right of survivorship.
Testator
The person who makes and signs a will. A female testator is sometimes called a testatrix, though testator is now used for all genders.
Trust
A legal arrangement where assets are held by trustees for the benefit of beneficiaries. Used for tax planning, asset protection, and controlling inheritance.
Trustee
A person who manages a trust on behalf of beneficiaries. Trustees must act in beneficiaries' best interests and follow the trust terms.