A beneficiary is any person or organisation that receives something under a will. The term covers anyone who inherits from your estate, whether they receive a specific item, a sum of money, or a share of what's left after other gifts and debts are paid.
Types of beneficiary
Beneficiaries can include:
- Individuals: Family members, friends, carers, or anyone else you choose
- Charities: Any registered charity can be named as a beneficiary
- Organisations: Clubs, societies, or other bodies
- Trusts: Money can be left to a trust for the benefit of others
Residuary beneficiaries
A residuary beneficiary is someone who receives whatever's left of your estate after all specific gifts, debts, taxes, and expenses have been paid. This is often the most valuable gift in a will, as it includes everything not specifically given to someone else.
Substitute beneficiaries
It's wise to name substitute (or alternative) beneficiaries in case your first-choice beneficiary dies before you. Without a substitute, the gift may fail or pass in ways you didn't intend.
Rules about beneficiaries
- Anyone can be a beneficiary - there are no restrictions on who you can leave your estate to
- Beneficiaries can also be executors (very common with spouses and children)
- Beneficiaries should NOT witness the will - if they do, their gift is void
- A beneficiary's spouse should also not witness the will