Attorney-at-Law and estate planning expert, Katia Denise Henry, was guest presenter at the May monthly Investors’ Forum hosted by Mayberry Investments Limited at the Knutsford Court Hotel, New Kingston.

Henry, who has been practising estate planning law for over 30 years, urged the audience to take seriously planning for the disposal of their assets after their death.

“The best time for you to protect your loved ones is now,” she told the audience.

“I keep insisting that that is what you need to do. Do not put off planning your estate, because what we are trying to do is to make sure that you have your taxes minimised, by taking action now when you are alive,” she said.

The estate planning expert gave the audience her advice on giving people control over their assets during their lifetime, or after death.

Henry gave a summarised explanation of the tax payments involved in estate planning as follows:

Transfer Tax

Transfer tax payable on the net market value of taxable property within one year of the date of death:

Individuals who died prior to June 1, 2005 – 15 per cent;

Individuals who died after June 1, 2005 – 7.5 per cent;

Individuals who died after May 1, 2008 – six per cent.

Individuals who died after January 1, 2009 – five per cent;

Individuals who died after August 1, 2009 – four per cent;

Individuals who died after May 16, 2011 – 1.5 per cent.

Interest payable one day after the first anniversary of the death – six per cent.

No taxable property can be transferred to beneficiaries of the estate until after the transfer tax is paid.

Stamp Duty

Stamp duty, as at May 16, 2011, for applications filed on or before April 27, 2011 attract flat fees as follows:

Estates valued at $10 million or less — $5,000;

Between $10 million and $19 million — $10,000;

$20 million to $29 million — $15,000;

$30 million to $39 million — $20,000;

$40 million and above — $25,000.

Originally stamp duty, which is payable on net market value of the estate of the deceased, was three per cent. It is payable before one can obtain a grant from the Supreme Court to call in the assets of the deceased, including insurance policies and money in the bank.

Where payment was already made on the basis of the three per cent, there will be no refund. This duty is affixed to the documentation for a grant of probate on letters of administration.

Attorney Fees

(*Bar Association rates)

Attorneys fees payable on the gross market value of the estate of the deceased, as at the date of the death of the deceased, where the estate exceeds $250,000 and in respect of obtaining a grant of probate and administration from the courts is three per cent.

For estates less than $250,000, the fee is five per cent of the gross market value of the estate, plus 16.5 per cent General Consumption Tax (GCT).

There is a two per cent fee payable on the gross market value of real estate to be transferred to beneficiaries plus 16.5 per cent GCT.

Attorney’s Fee for preparing the revenue affidavit for obtaining the commissioner general’s assessment of transfer tax payable in the estate plus GCT of 16.5 per cent is $80,000.

Fees Under the Fair Competition Act

With the passing of the Fair Competition Act on September 9, 1993, attorneys’ fees are no longer governed by the Bar Association’s scale of fees. Therefore, the fees will now differ from attorney to Attorney, and will be based on what the client is prepared to pay.

Attorneys are usually charging five per cent to seven per cent to obtain the Grant of probate/letters of administration, and two to three per cent to transfer the land. The total attorney’s fees, therefore, ranges between seven per cent and 10 per cent plus 16.5 per cent GCT.

Cash Fees

Advertisements for creditors in the newspapers and the Gazette (payable for both Probate and Administration) — $4,000;

Advertisements for notice of application for grant of administration in the newspaper and the Gazette (payable only in Intestate estates) — $4,000;

Photocopying and miscellaneous expenses — $10,000;

Registration fees on transmission and transfer — $6,000. (This cost is to be charged for each title for properties in estate.

Executor’s Commission

Commission paid to executors/administrators of money passing through their hands

If more than one executor/administrator, then the commission is divided equally. An executor’s commission may be forfeited if he is a beneficiary of the will.