The financial planner appears to have failed to understand the DoV concept. He/she is presumably operating in the belief that a DoV “re-writes the deceased’s will” which he/she thinks could thus include a letter of wishes written by the deceased.
Confusion as to the position of a DoV in the real world versus IHT treatment is by no means uncommon.
I was in the past asked to “educate”/“train” financial advisers in a number of banks. It became clear to me that most (not all) of them were unaware of what they didn’t know when it came to tax issues. Thus, for example, re DoVs, the common understanding was that a will could simply be rewritten in its entirety and, typically, most had never even read any part of IHTA 1984 including s142.
Commissions on selling SPBs were I understand relatively high. Many were sold to non-UK domiciled resident individuals out of the Isle of Man on the basis that remittance basis treatment applied to any chargeable event gains arising.
It was agreed that such planners within the banks did not give tax advice and were told to refer clients to their own tax advisers. Unfortunately, this didn’t always happen in practice.
Advisers, like to keep clients to themselves and whilst perhaps understandable tends to mitigate against referring the client to other “competitors” when specialist knowledge is needed.
Malcolm Finney