:salamext:
Making a valid Islamic Will
To ensure that your Will is valid, the basic requirements of UK domestic law must be satisfied:
- You must be at least 18 years old;
- Of sound mind;
- Your Will must be in writing;
- Your Will must be made without any undue influence;
- You must identify yourself as the author of the Will. You should state that it is your last Will – and that any previous Wills and Codicils are revoked;
- The Will must be dated and signed by you in the presence of and attested by two witnesses who are neither a spouse nor a beneficiary under the Will.
For an Islamic Will, it is equally important the you include details of the following:
- A declaration of your faith to Islam;
- Explicit reference to funeral and burial arrangements (step 4);
- Stipulation that you wish for your estate to be distributed in accordance with the Shari’a of Islam (step 5);
- Details, including full name and address of executor(s) who you wish to carry out the wishes expressed in your Will (step 6);
- A last message for your loved ones – which should include a request to honour the contents of your Will – and not to modify it in any way.
Value your assets
Before making a Will it is a good idea to make a list of everything that you own. This is known as your ‘estate‘ and includes your home and its contents, your car and your savings – less any debts to include funeral expenses and any religious liabilities such as unpaid Zakah The estate form can be used a rough guide to work out the current value of your estate.
Where potentially large estates are involved and therefore inheritance tax liability could be considerable, steps should be taken to avoid it. Under current laws, the inheritance tax (IHT) threshold – also referred to as the ‘Nil Rate Band’ stands at £263,000 and is subject to review annually. Where an estate’s value exceeds this amount, inheritance tax at a rate of 40% will need to be paid on the extra. So for example, if your estate is valued at £526,000, the inheritance tax liability would work out as £105,000.
[Value of estate £526,000
Inheritance tax allowance £263,000
Residue £263,000
IHT liability (£263,000 * 40%) = £105,000]
Whilst the number of people subject to inheritance tax remains relatively small, the increase in house prices in recent years has resulted in more people subject to this tax.
There are however, a variety of methods that you can use to minimize or eliminate having to pay inheritance tax including the following:
Bequests to registered charities in the UK – in accordance with Islamic guidelines, bequests can only be made up to a maximum of 1/3 of the estate after payment of debts, funeral, tax and administration expenses. So long as the charity is registered in the UK the gift will be free from inheritance tax.
Gift exemptions – you can give away as many small of gifts of £250 every tax year as you wish, £5,000 to each child on their marriage and regular gifts out of your income provided they don’t affect your standard of living. In addition to this, you are entitled to give away £3000 every tax year without an IHT charge. This annual exemption may be carried over to the following year if it remains unused – but not thereafter.
Gifts made seven years prior to death –Also referred to as Potentially Exempt Transfers (PETs), these gifts are exempt from IHT. If however you don't survive seven years from the date of making the gift, IHT is charged on a sliding scale ranging from the full 40% in the first three years to 8% if you die between the fourth and seventh year after making the gift. However, where you continue to reserve an interest in the gift – (for example by residing rent-free in a property that you have gifted to your child), IHT will be liable at 40%irrespective of when the gift was made.
Gifts between spouses (inter-spouse exemption) / discretionary trusts– all transfers between husband and wife are free of inheritance tax. However it is important to note that Muslim marriages conducted in the UK without a civil marriage ceremony are not recognized as valid marriages under English law and therefore the inter-spouse exemption rules cannot be applied. Furthermore on the surviving spouse’s death - inheritance tax is liable on the entire estate, so it may not necessarily be the most appropriate option.
A more effective method may be to set up a discretionary trust in your Will, for example a married couple could bequeath £263,000 tax-free to their children, with the balance of the estate passing to the surviving spouse. On the second spouse’s death, the children could receive a further £263,000 tax-free allowance, which would effectively amount to a saving of £105,000 (£263,000 * 40%). You will need to consult your solicitor for further details making sure that such trusts remain Shari’a compliant.
Do you need a solicitor?
It is possible to make your own Will, but because it is a legal document, you are strongly recommended to seek independent professional advice, especially if you wish to make several specific bequests, if your financial and property affairs are complicated or where your estate is valued in excess of £263,000.
How much does it cost?
Costs vary and will depend mainly on the complexity of the Will you have drawn up. As a rough guide you can expect to pay between £100 and £150 for a simple Islamic Will – but considerably more for tax planning advice.
Having a Will drawn up professionally is a sound investment - but even if you do make your own Will, it’s worth having it checked over by a solicitor. It’s easy to make mistakes – and if errors are found in the Will it can cause problems after you die. If there are disputes or you haven’t had tax planning advice it may result in unnecessary legal and tax bills, thereby reducing the amount of your estate.
Finding an Islamic Wills practitioner
The whole concept of Islamic Wills in very much in its infancy in the UK, and there are only currently a handful of practitioners who offer advice in this area.
Understanding the difficulty that many Muslim clients face trying to find a solicitor who can help, Islamic Relief are in the process of compiling a detailed list of practitioners* who provide Islamic Wills advice.
For further details please contact our legacy officer.
*Referral by Islamic Relief to practitioners offering an Islamic Wills service does not imply endorsement or recommendation. Advice offered is independent and impartial.
Note to practitioners: With a growing demand to cater for the needs of many Muslims who wish to have access to Islamic Wills advisory services, Islamic Relief are especially keen to hear from solicitors and qualified Wills and Probate advisers who are (or may be interested) in providing this service to the Muslim community. The Association of Muslim Lawyers UK periodically hold Islamic Wills training seminars - to find out when and where the next one will be held visit their website at
http://www.aml.org.uk.
Decide on your funeral and burial arrangements
It is important that you specify in your Will how you would like you funeral and burial rites to be carried out, which would include:
Having your body released for burial immediately after death:
Stipulate that your dead body not be subjected to embalment or a post-mortem examination unless it is a requirement by law – and that the body be washed, shrouded, prayed for and buried, in accordance with the tenets of Islam.
Advising where and how your body is to be buried:
Whilst there is an increase in the number of Muslim cemeteries in the UK, and many local authorities do make provisions to have a grave dug and the body buried, in a location where all the graves are aligned with the qibla – it is nevertheless a good idea so stipulate in your Will that you would like a Muslim burial – and to be buried in the nearest Muslim cemetery to where your death occurs.
If you would like to be buried overseas, it is important to note that as well as being costly, the dead body is usually eviscerated, emptied of blood and filled with alcohol before being flown abroad.
Organ donation
Ensure that you clarify whether or not you wish for your organs to be used for transplantation. There are different opinions regarding the permissibility of organ donation in Islam– and it is recommended that you consult an Aalim for detailed rulings.
Choosing executors to carry out your burial and funeral arrangements
You may wish also to nominate executors in your Will to carry out the provisions you have made for your funeral and burial arrangements. It’s a sensible idea seek their permission first to see that they are willing to carry out this task.
Decide what to leave to whom
After the payment of funeral and burial expenses – all outstanding debts need to be cleared before any bequests can be made or division of the estate can follow.
List your debts
It’s a good idea to periodically update a list of all your outstanding debts, which would include legal expenses involved in administering your estate as well religious obligations to Allah – such as unpaid Zakah, unperformed pilgrimage (Hajj), unperformed fasts (sawm) or any other Kaffarat. This list should be kept with your Will, so that it makes it easier for your executor(s) to administer your estate.
Making your bequests
After the fulfillment of all monetary obligations – it is permissible to bequeath up to a maximum of one third of the remainder of your estate - to whomsoever you wish. However, you are not permitted to bequeath from this one-third to anyone who is entitled to a fixed share (i.e to your legal heirs).
Based on Islamic guidelines, it is recommended that you bear in mind the following people, when you come to making a bequest or bequests:
-
The poor and incapacitated;
- Orphans; and
- Needy relatives, including widows such as orphaned grandchildren.
An ongoing charity is one of only three actions, which may continue to reward you after you die – so consider too making a bequest for Sadaqah Jariya projects such as the building of wells, schools, orphanages and the like.
Remember - where you would like to make several bequests – ensure that you specify what proportion is to be assigned to each recipient.
If, when it comes to the division of the estate, it transpires that the bequests are more than a third, then either the executors have to reduce the bequests proportionately, or those entitled to fixed shares may (but do not have to) agree to accept a diminution in their shares.
Distribution of the inheritance
After making any bequests, you will need to specify that the remainder of the estate (which will amount to a minimum of two thirds) is to be distributed in fixed shares in accordance with whichever madhhab you follow.
Specific items or sums of money can be specified as part of any particular relative’s share. If, when it comes to the division of the estate, it transpires that the value of any specified item(s) is more than the value of the share to which the relative is entitled then either the executors have to reduce or even ignore what has been specified, or the other relatives entitled to fixed shares may (but do not have to) agree to accept a diminution in their shares.
The bottom line is that if anyone entitled to a share wants that share, then no-one can make them give it up or accept less than it.
It is quite common for a testator to simply state that he or she wants all the estate to be divided amongst the surviving relatives in accordance with the Shari‘a without specifying any particular item for any particular relative.
As regards calculating the shares, the basic principles are these :
(i) The closest relatives (husband, wife, son daughter, father, mother) will always inherit a share and will always have precedence over and exclude more distant relatives.
(ii) In the absence of the closest relatives, the more distant relatives (such as grandparents and grandchildren, for example) will then be entitled to inherit fixed shares.
This pecking order means that you may wish to make bequests out of your one third to distant relatives who may not otherwise inherit from you because they will be excluded by the closest relatives from automatically receiving shares.
It is prudent to have what is called a residuary clause dealing with what should happen to the estate if there are no surviving relatives – in which case the estate can be left to one or more charities (and if more than one, then in what proportions).
Under Shari‘a, your estate would go to the bayt al-mal to be spent on social welfare, but until your community has a bayt al-mal, a charity concerned with social welfare is the next best option.
As regards any residue, which may arise as a result of any part of the Will failing for any reason, it is prudent to direct that this be held by the executors on trust to be distributed to those in need in the Muslim community in accordance with the Shari‘a of Islam.
Choose your executor(s) wisely
You will need to choose up to four people to carry out the wishes expressed in your Will. Executors can also be beneficiaries in your Will – in fact it is normally the case that the spouse or main beneficiary acts as one of the executors. It is recommended that you choose at least two executors in case one is unable to act. If you are choosing friends or relatives, make sure they are willing to accept what can be a lengthy and time-consuming responsibility, for they are not normally paid for this task - although they can usually re-claim any expenses incurred in the administration of the estate.
If you are choosing lawyers, remember that they will probably expect to be paid for their services charging on average between 2 to 3% of the value of your estate. The more complicated your affairs, the more prudent it is to choose a specialist lawyer.
When choosing your executor(s) you there are a few criteria to consider, namely;
That they are aged over 18;
Muslim;
Of sound mind; and
Reliable and trustworthy.
It is not essential that the executor(s) know how to calculate the Qur’anic shares, although it certainly helps! If your executors do not know how to do this, they can either find an Aalim who has this knowledge to assist them, or they can use the IRTH software which works out the entitlement to each shares.
Choose a guardian for children
If it is possible that you may have children under the age of 18 when you die, you should appoint a Guardian to look after them in the unlikely event of both you and your spouse dying while they are still minors. This point is particularly significant for those who have non-Muslim relatives and want their children to be brought up as Muslims.
The Guardian appointed should be Muslim, trustworthy and of sound mind. Custodial rights in order of preference are father, mother, paternal grandfather and then any persons who you appoint to act as Guardian(s). It goes without saying that you should always check with your proposed Guardian(s) in advance to be certain they are willing to act.
There should also be a clause in your Will dealing with how any minors’ shares should be held on trust and invested and expended for the children’s maintenance, education or benefit.
Choose your witnesses
Ideally, choose two trustworthy Muslim men to witness the signing of your Will. If this is not possible, then two non-Muslim men may be taken as witnesses. Women may also act as witnesses. Under Shari‘a, two women may act as witnesses instead of one man. For the purposes of English law one woman may act as a witness instead of one man. Witnesses must be aged over the age of 18, of sound mind and not blind!
It is important that both witnesses are present when you sign and date the Will, although they need not necessarily see the contents – only your signature and it is not necessary for the Will to be witnessed before a solicitor.
Remember: anyone who will benefit from your Will cannot be taken as a witness. This also includes anyone married to a beneficiary of your Will. If this does happen, they will not be permitted to inherit from you.
Keep your Will safe and up-to-date
Once you have made your Will and it has been signed and witnessed, store it in a safe place or with your solicitor or a trustworthy relative or friend. Make sure that your executor(s) are informed where the original Will is being kept and keep a photocopy for your own records.
Updating your Will
Review your Will on a regular basis, since changing circumstances – especially your marital situation (marriage, divorce or re-marriage) may affect its validity.
If there are significant changes of circumstance, it may become necessary to make a new Will, but for minor changes you may just require a Codicil – which makes an addition or alteration to your existing Will.
So if you’ve already made a Will, but would like, for example, to include a bequest to charity, the process is fairly straightforward – and can be drawn up by a solicitor.
Remember: Do not try to alter your Will by crossing out or adding words. If you do this, your Will may be rendered invalid in the eyes of the law, so if you then die without having made a new Will, it will be as if you had never made a Will at all.
:wasalamex