What the trial of Pope Formosus can teach your clients about the importance of estate planning

The trial of Pope Formosus took place over 1,000 years ago and yet the unusual circumstances surrounding it can provide some important lessons for your clients about preparing their estates before they’re gone.

If your clients leave key decisions regarding their estate undecided at the time of their death, they could find themselves open to others stepping in and making choices for them and acting against their best interests.

Read on to discover three ways your clients can learn from Formosus about the benefits of timely estate planning.

Pope Formosus was put on trial by his successor 7 months after he had died

On 4 April 896, Pope Formosus passed away after a short and troubled reign beseeched by power struggles, in particular the decision to side with Arnulf of Carinthia against Lambert of Spoleto.

Pope Formosus had a deeply distrustful relationship with Guy III of Spoleto, the reigning emperor, and gathered support to supplant him with Arnaulf. Guy’s son Lambert fled home to Spoleto and an uneasy stalemate formed between the opposing houses.

After Formosus passed away, he was eventually succeeded by Stephen VI. Stephen was loyal to Lambert and so decided to exhume Formosus’s body seven months after his death and put him on trial in what became known as the “Cadaver Synod”. 

Formosus’s corpse was disinterred, clad in papal vestments, and seated on a throne to face his charges. After receiving a guilty verdict, his edicts were annulled, and his body desecrated. 

The macabre spectacle turned public opinion against Stephen and an uprising led to him being deposed, imprisoned, and then murdered during his incarceration.

Pope Formosus’s remains were reinterred in Saint Peter’s Basilica and the new Pope Sergius III banned any future trials against deceased persons.

While it’s unlikely your clients will see themselves exhumed and put on a posthumous trial, it is possible for them to lose control of the handling of their estate once they’re gone if the right steps aren’t taken while they’re still alive.

3 ways your clients can prepare their estate and protect their legacies when they’re gone

1. Ensure they have a detailed will written

A will is one of the easiest and simplest ways to ensure that your clients’ wealth is passed onto their loved ones in the way that they desire, yet according to Which?, nearly 60% of Brits don’t have a written will.

Wills become increasingly important if your clients and their partners are unmarried or if they have loved ones that don’t benefit from a direct connection by marriage or biology.

In the event that they do not have a will, your clients’ assets will be distributed under the rules of intestacy. This method is likely to leave your clients’ estates exposed to potentially hefty Inheritance Tax (IHT) bills, as the process isn’t set up to be as tax-efficient as possible.

Pope Formosus could have better prepared for his demise and the consequences that befell his body and the papacy, by making arrangements with the various parties to diffuse ongoing tensions, enact laws to protect his legacy, and even prohibit such a scenario in which a corpse stands trial.

Research from Royal London reports that almost 6.5 million UK adults refuse to discuss their will with their loved ones, so before making any final decisions your clients might benefit from having an open conversation with their families about their wishes. 

2. Consider gifting their wealth while they’re still alive

An increasing number of Brits are opting to gift their wealth to their loved ones while they are still alive. This helps them witness the benefits to their loved ones’ lives, while also helping them avoid potential IHT obligations on their estate through the tax-efficient rules around gifting.

If Pope Formosus had planned ahead, he could have ensured his legacy and his succession once he was gone by imparting his authority to those loyal to his cause and leaving the papacy in a prosperous situation, free of potential power struggles and conflict. 

Gifting can be very beneficial when it comes to reducing IHT and can involve gifts of up to £3,000 (as of the 2022/23 tax year) as part of the annual exemption, which clients can use in each tax year. Gifts can be useful in reducing IHT obligations in the future.

Clients can also gift larger amounts that will typically fall outside their estate if they survive for seven years after making the gift.

3. Maximise the legacy they leave their loved ones with careful IHT planning

Pope Formosus lived in the now, fought his battles, but didn’t consider the long-term consequences. He paid his dues posthumously when his corpse faced trial and his legacy was tarnished, essentially in the form of his substantial IHT bill.

IHT can quickly reduce the value of your clients’ estates. If the total value of their assets exceeds £325,000 (or £500,000 if they plan to leave their home to a child or grandchild), IHT may be due, and steps should be considered to protect their loved ones’ inheritance.

This could involve:

  • Using spousal benefits such as the exemption from IHT when receiving inheritance from their deceased partners. Your clients may also be able to pass on nil-rate allowances to their partners’ estates
  • Saving into tax-efficient pension schemes to reduce their Income Tax outlay and IHT liability, as pensions are typically treated as being outside of their estates (dependent on the type of pension)
  • Investing in an Enterprise Investment Scheme (EIS) or Venture Capital Trusts (VCTs), which are high risk but offer tax-efficient incentives and, in the case of EIS, qualify for 100% relief from IHT (provided the assets have been held for at least two years).

There are many beneficial steps your clients can take to better prepare their estate for their passing and maximise the legacy they leave behind for their loved ones.

Get in touch

If your clients have any concerns about their estates, IHT issues, or properly preparing their wills, they should email us at mail@delaunaywealth.com or call us on 0345 505 3500.

Please note

This article is no substitute for financial advice and should not be treated as such. To determine the best course of action for your individual circumstances, please contact us.

The Financial Conduct Authority does not regulate estate planning, tax planning or will writing.

This article is for information only. Please do not act based on anything you might read in this article. All contents are based on our understanding of HMRC legislation, which is subject to change.

Enterprise Initiative Schemes (EIS) and Venture Capital Trusts (VCT) are higher-risk investments. They are typically suitable for UK-resident taxpayers who are able to tolerate increased levels of risk and are looking to invest for five years or more. Historical or current yields should not be considered a reliable indicator of future returns as they cannot be guaranteed. 

Share values and income generated by the investments could go down as well as up, and you may get back less than you originally invested. These investments are highly illiquid, which means investors could find it difficult to, or be unable to, realise their shares at a value that’s close to the value of the underlying assets. 

Tax levels and reliefs could change and the availability of tax reliefs will depend on individual circumstances.