To plan inheritance in Nigeria, you need to critically think about who you want to leave the inheritance for, what inheritance you want to leave, and how you want to leave the said inheritance as well as how you expect them to use the inheritance.
A common misconception is the assumption that inheritance planning is in fact the same thing as estate planning. However, this is not the case, rather inheritance planning falls under estate planning. Estate planning is the preparation of tasks for the purpose of managing individuals' assets portfolio in the events of their death.
Benefits of Inheritance Planning in Nigeria:
The importance of inheritance planning in Nigeria cannot be overstated and some of them are highlighted as follows:
- You are rest assured that your properties are in the specific hands that you desire them to be upon your demise.
- You can pre-determine the ownership, utility and to some extent, the functionality of the properties you leave behind upon your demise.
- You will be able to appoint the executors of the estate. i.e. those that will ensure your express wishes in the will are actualized.
- You reduce the likelihood of conflict over your properties between beneficiaries and non-beneficiaries alike upon your death.
- Where legacy is important to you, you can leverage the preparation of a will to preserve your legacy through deliberate expression of your wishes in this light.
The Process of Inheritance Planning in Nigeria
When it comes to inheritance planning in Nigeria, it is important to plan towards covering your lifetime expenses first and determine what will be left over to gift after your passing away. This way, you can be rest assured that you are not leaving liabilities behind, but rather assets.
The first step is to get organized. This Involves sitting down to settle one's finances. This can be done with the aid of a financial planner, real estate lawyer, a tax professional, stockbroker and other professionals as the case may be. This inheritance plan will maximize the inheritance left to your heirs. It is at this stage that the creator of the inheritance plan would sit down, take note of family values, and make a plan which would establish and protect his legacy.
In a situation where most of your children or beneficiaries are minors, one can leverage the use of Trust via a trust deed. This gives survivors control over your properties for the benefit of your minors until they come of age. It is advisable to use a trustworthy person who shares the same values with you and who understands the legacy you intend to protect.
Additionally, although often overlooked by many, inculcating your beneficiaries with sound financial knowledge and management skills is something that is critical to inheritance planning. This is especially important where there is an entity that is beyond you i.e. that affects others. For example, as a company owner who has members of staff and customers, your inheritance planning should anticipate prudence, and this can be done through the deliberate training of your heirs.
Finally, the documentation of your inheritance plan can be done using a trust as mentioned above or a will. A Will is a 'testamentary document' made by a person referred to as the "testator".
It is done by persons seeking to document their inheritance plans so as to create tasks and instructions for the executors when organizing the deceased' estate. In this document, such person disposes their properties (real or personal) to persons (beneficiaries) which will take effect after their death.
A Will being testamentary in nature implies that it comes to effect upon the death of the testator. A will and a trust under a trust deed helps to prevent ambiguity and they form the instrument parts of inheritance planning.
Inheritance planning is an important and everlasting gift you can ever give to your family and loved ones. Setting up inheritance planning in Nigeria is not as difficult as most people think. You only need to get the right information and the right persons to help you plan and implement it.
However, Inheritance planning in Nigeria can be messy if not done well or guided by a good family lawyer. So it is highly recommendable you seek legal assistance while planning an inheritance.
Co author by Opeyemi Oyedele – (Graduate Intern, OAL)
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.