Personal Chattels: What are they and what do they mean?

sarah ryan
Sarah RyanAccount Manager @ Lawhive & Non-Practising Solicitor
Updated on 1st December 2023

If you’ve ever wondered what happens to your treasured vinyl collection, vintage threads, or that quirky teapot collection you’ve been working on when you’re no longer around, you’re in the right place. 

what-are-personal-chattels

In this article, we’re looking at an area of estate planning that might have you scratching your head - personal chattels. Read on to find out: 

  • What are personal chattels;

  • Why do personal chattels matter in estate planning;

  • How to handle personal chattels.

Understanding personal chattels isn’t just about “things.” It’s about preserving your story, passing on memories, and making sure your favourite leather jacket goes to someone who’ll appreciate its rock ‘n’ roll vibes. In short, your stuff, your story - let’s make sure it’s told right. 

What are personal chattels?

Personal chattels are basically your personal belongings. Back in 1925, when the concept of personal chattels were first introduced, it was all about carriages and horses. But let’s be real, who’s leaving a horse and carriage in their will nowadays? So, as of October 1st 2014, the definition was revised for modern times. 

Now, personal chattels refer to your ‘tangible movable property’ - basically, the things you can touch or move around that aren’t money or property. 

Do personal chattels form part of your estate?

Personal chattels do form part of your estate and their value will have an impact on your estate’s Inheritance Tax calculations. 

When you pass away, the executor of your will is responsible for valuing the estate for probate and paying the necessary tax. It’s recommended that items with a price tag of around £500 or more are professionally valued to accurately reflect their worth on the open market at the time of death. 

For this reason, it's a good idea to know what personal belongings you have and what you want to happen to them when you're no longer here.

Examples of personal chattels

Some examples of personal chattels include: 

  • Jewellery: Items like rings, necklaces, watches, and heirloom jewelry often hold significant sentimental and monetary value.

  • Furniture: This includes sofas, tables, chairs, beds, cabinets, and other household furnishings. Antique furniture or pieces with sentimental value may be essential to your family.

  • Electronics: Items like televisions, computers, smartphones, and audio equipment are personal chattels with significant value in today's digital age.

  • Art and Collectibles: Paintings, sculptures, vintage posters, and other forms of art and collectibles can be valuable and meaningful possessions.

  • Clothing: Your wardrobe, including clothing, shoes, and accessories, falls under personal chattels.

  • Vehicles: Cars, motorcycles, bicycles, and other personal modes of transportation are considered personal chattels. Classic or luxury vehicles can hold substantial value.

  • Household Items: Everyday items like kitchen appliances, cutlery, dishes, and home decor are examples of personal chattels that can carry sentimental value.

  • Books and Personal Collections: Whether it's your extensive book collection, stamps, coins, or other personal collections, these items are often significant.

  • Memorabilia: This can include items related to sports, music, or other personal interests. Autographed items, vintage posters, and sports memorabilia are common examples.

  • Sentimental Items: Personal mementos, family heirlooms, and keepsakes that hold sentimental value may be the most cherished personal chattels.

  • Pets: While pets are not possessions in the traditional sense, they are an essential part of many families and may require consideration in estate planning.

How to deal with personal chattels in estate planning

When someone passes away, emotions can run high among those left behind, and arguments can arise over who gets what as part of their inheritance. Usually, higher ticket items like property are pretty clear cut when someone makes a will, but personal belongings, aka 'personal chattels’ sometimes fall by the wayside in estate planning.

While these belongings aren’t always big-money items, they can cause problems. For example, that old record player or your favorite mug could mean the world to someone. And, trust us, family tiffs over this stuff, big or small, can get messy. 

Add them to your will 

You can, of course, list all of your personal belongings and wishes for them to your will.

The trouble is adding a whole bunch of personal chattels to your will can make it pretty lengthy. And as time goes on, you might get more stuff or change your mind about what goes where. This might leave you constantly updating your will, which can be a pain but also make it confusing to understand, particularly when things like property are added to a mix.

So, what are your other options when it comes to making your wishes for your personal chattels clear? 

Make a letter of wishes

Instead of listing every personal item in your will, you can instead refer to a letter of wishes, which is basically a note that tells the executors of your will what you want to happen to your stuff. Because it’s not part of your official will, you can write a letter of wishes yourself, update it whenever, and it won’t cost you a ton of time or money. 

The only drawback of a letter of wishes is that it’s not legally binding. Instead, it’s left to the discretion of your executors what happens to your personal belongings, using the letter as a kind of guidebook to know what’s what and where it should go. Also, if anything in your letter of wishes contradicts your will, as the will is legally binding this takes priority. 

When creating a letter of wishes, you should:

  • Identify the personal chattels you are referring to;

  • Express your sentiments and intentions clearly and concisely;

  • Store the letter in a secure and accessible location;

  • Inform your executor about the existence and location of the letter.

Leave personal chattels to the residuary estate

Another option is to let your personal chattels join your residuary estate. This means that the executors can sell them, and the cash gets divided up among your residuary beneficiaries. 

This is a simple and straightforward way of doing things that can potentially field any arguments that might crop up among who gets what. However, it doesn’t allow for the nuance of leaving pieces of sentimental value to specific people, which may cause unintended drama.

Let your loved ones choose what to keep

You could also put into your will that you would like your loved ones to pick a memento each within a time-frame, then anything left over is sold and the proceeds are then shared among the residuary beneficiaries. 

This can be a good way of making sure everyone gets an equal chance to take away a memento while being clear about what happens to the rest of your stuff when you’re gone, and who benefits from it. 

Ultimately, how personal chattels apply to you depends on your unique circumstances, priorities, and values. Proper estate planning allows you to make decisions that align with your wishes, ensuring that your personal possessions are distributed according to your intentions.

Making gifts while you’re still alive

While no one really wants to think about death, effective estate planning does require a little bit of forward thinking. Another option to consider is making gifts of your personal chattels while you’re still alive. 

There are some benefits to doing this, particularly in relation to inheritance tax. For example, if you give a gift more than 7 years before you pass away, the value of that gift is not included in inheritance tax calculations. However, if you die within 7 years of giving it, it is. 

It’s possible that you have personal chattels that don’t lose their value. In fact, they may increase in value over time. If you give away those treasures while you’re still alive and you’re still kicking after 7 years, it’s not included in your estate and the receiver will enjoy the full benefit of its value.

What’s more, if the thing you’re giving away is worth £6,000 or less, there’s no need to pay Capital Gains Tax on it when you hand it over. This is called ‘holdover relief,’ which means your passing on the CGT responsibility to the new owner who only pays if they decide to sell the gifted treasure later on. For personal chattels worth more than £6,000, however, it’s a different story. If you’ve already used up your annual CGT allowance, you might get hit with a CGT payment when you hand it over.

What happens to personal chattels if you don’t make a will?

When you die without a will, your personal chattels are distributed under the rules of intestacy. This starts with your spouse or civil partner, if you have one, and then moves to your closest family members (i.e. children, parents, siblings, etc). There is a set hierarchy for how your assets are distributed if you die without making a will. 

How to avoid problems with personal chattels? 

Dealing with personal belongings of an estate isn’t always easy. 

First of all, not everyone might get the memo that personal chattels are part of the estate. So, well-meaning individuals might speed clean a property and unknowingly throw things away that are meant for specific beneficiaries, or are required for valuation for tax purposes.

Even if the clearing is done with care, it’s also possible that things might get lost or end up in the wrong hands before the estate is formally distributed according to a will or letter of wishes.

One of the more common problems with personal chattels is family members not seeing eye to eye on who gets what.If a will doesn’t say who gets what, there’s the potential for disagreements (aka contentious probate) to arise which aren’t just unpleasant but also time-consuming and expensive. 

Here are three tips to help dodge the drama and plan for an easy estate journey: 

Open communication 

Start the conversation about your wishes for your belongings while you’re still in good health.

We get it, no one loves having tough conversations like these, but being open about what you want to happen to your stuff after you die can help to make sure everyone is on the same page and avoid disputes that may arise when the time comes. 

Make a clear will 

Secondly, make sure it’s crystal clear what should happen to your personal chattels. We’ve covered this above. You can either detail every single thing in your will, or leave instructions for your executor based around a letter of wishes or other instructions. It’s your call, but the clearer you are about what you want, the less likely it will be for problems to crop up. 

Store your wishes safely 

Make sure somebody knows where you will and your letter of wishes are stored. This could be your executor, spouse, children, or even a solicitor. Then, when the time comes it can be located and referenced before any property is cleared out or sold.

Get help with estate planning from Lawhive

Understanding personal chattels and how they fit into estate planning is a vital aspect of securing the future of your cherished possessions and ensuring your loved ones receive the items that hold sentimental value. From treasured family heirlooms to valuable collectibles, these personal chattels represent an essential part of your legacy.

If you need any help and advice relating to making a will and estate planning, please contact our legal assessment team, who will assess your case and provide clear next steps, along with a fixed fee quote for the services of our expert UK solicitors.

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