Editor's note: The views expressed below are those of the author and not necessarily shared by this publication but it is grateful for the contribution to the debate.

Recent research conducted by Forbes suggests that seven out of ten of the world’s billionaires are self-made and over 40 per cent of those directly involve their family in the management of their wealth. High-profile examples of family businesses such as fashion giant Hermes further confirm that when it comes to the fortunes of the high net worth community, it pays to keep it in the family.

While many of these high profile families are able to guard their wealth and hand it down generation after generation there are plenty of others who, with distinctly less wealth, nevertheless cause difficulties for their families by failing to make an up-to-date will before they die – and cause a high proportion of their wealth to be wasted as a result.

Research has consistently shown that over half of the UK population does not have a will at all. Whether it is a reluctance to think about death or simply not getting round to it, the reasons given for not making a will are varied.

But while lawyers have been involved in resolving the problems raised by an incomplete or non-existent will for centuries, increasingly independent financial advisors to the wealthy are becoming party to these conversations as their remit evolves to include advising on tax efficiency while making a will.

Complications

Complications in fairly dividing an individual’s assets out between members of their family often arise when dealing with cross-jurisdictional issues, either where the will is being contested or if there is no will. For example, I have advised in many cases where the deceased has properties and other assets spread across various different countries and so sit under different regimes when dealing with foreign “forced heirship”, with different inheritance consequences.

These issues are further complicated if the will is not up to date and the deceased’s family situation has changed since the will was made – most often where there has been a divorce and the testator has gone on to remarry and in some cases, have children with their second (or sometimes third) spouse.

So what is the message to those individuals who may have a more complex array of assets and/or a complicated family situation that threatens to turn simple estate planning into a complex legal case with the potential to cause long-running and sometimes irresolvable problems?

Those individuals who have assets spread across various jurisdictions will of course need a more sophisticated level of advice to ensure that their assets are divided according to the testator’s intentions, and to ensure that the spouse, children or other family members left behind don’t unwittingly lose out on the value of these assets in paying more by way of fees and taxes than they have to. This is where the expertise of an advisor who understands the interplay between the regimes of various jurisdictions is invaluable.

IFAs

IFAs should ensure they are fully up to speed with the individual’s true position in the jurisdictions in which their client has property or other assets.  It is too easy to fall into the trap where a client says “Oh, I have a property in Ruritania, but the lawyer there sorted the succession out so you can ignore that.” Beware! In these situations, IFAs and lawyers can work together to press forwards with a solution that is both legally and economically advantageous for their client.

HNW individuals and their families are often adept at using financial planning to protect and maximise their assets in the here and now. However, sometimes the tax tail wags the dog.  First and foremost the team have to look at:

(a)    the outcome the testator wants

(b)   the governance issues that may arise

(c)    the legal issues that flow from that; and

(d)   lastly, the financial and taxation implications.

An incomplete approach to the process of properly planning an estate will lead to trouble, not just for the family but probably also for the hapless advisor.