Mediation and tax-efficient settlement of probate disputes

Mediation is an opportunity to transform an acrimonious probate dispute into a joint problem solving exercise by applying estate and business succession planning principles to discover and unlock tax efficiency post-death resulting in the consequential enlargement of the estate or trust fund pie for settlement.

In a probate or trust dispute the convergence of interests around the win/win principle of expanding the estate or trust fund pie by agreeing terms of settlement that result in enhanced tax-efficiency for the benefit of the estate/trust fund opens the door to retrospective estate planning where:

• The drafting of a will or trust is deficient from an inheritance tax planning perspective eg if property is left into a discretionary trust because the residential nil-rate band (RNRB) is not available even if all beneficiaries are lineal descendants as the beneficiaries are not treated as the beneficial...