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JANUARY 2011

Many people intend to get around to writing a Will; unfortunately some people will die before they have done so. The rules of intestacy then apply, which set out exactly who will inherit the estate, and in what proportions. These rules can be unfavourable for a surviving spouse, especially if there are children of the deceased living also.

The basic rules are as follows:

Surviving spouse

If a person dies after 1st February 2009 leaving a spouse or civil partner and children and the estate is valued at more than £250,000, the spouse will inherit the deceased’s personal belongings and the first £250,000 of the estate, as well as a life interest (a right to income but not to the capital) in half of the remaining estate. The rest of the estate will pass to any children (or grandchildren by substitution) in equal shares. Those children will also inherit in equal shares the capital of the surviving spouse’s life interest on that spouse’s death.

If there are no children, but the deceased left parents or brothers and sisters or other close family members, then the surviving spouse or civil partner will receive the first £450,000 and half of the remaining estate absolutely. The other half of the estate will pass to the other surviving relatives in the following order of priority: parents; brothers and sisters or their children; uncles and aunts or their children.

If the estate is less than £450,000 the deceased’s surviving spouse or civil partner will receive the whole of the estate.

So it may come as a surprise that the surviving spouse will not necessarily inherit the entire estate if there are other family members alive.

No surviving spouse

If there is no surviving spouse then the children of the deceased will inherit in equal shares the entire estate absolutely. If there are also no children living then it will be the deceased’s parents or brothers and sisters etc who will inherit the entire estate. If there are no children or other surviving relatives then the Crown will inherit the estate as bona vacantia. In this circumstance, most people would prefer their estate to go to a friend or to charity in preference to the government.

The modern family unit has become more complex with many people remarrying later on in life or having children with several partners. If you are not married but are in a long-term relationship, your partner will not inherit anything (although there still exists the possibility of making a claim under the Inheritance (Provision for Family and Dependants) Act 1975) under the present intestacy rules.

So is this how you would wish to your estate to be distributed on your death? While for some people the intestacy rules simply follow the route they would themselves have chosen, for others this is not the case. It follows that making a Will is prudent.

Your Will can be as straightforward or as complex as you would like it to be so please contact a member of the Private Client team on 0207 404 0606 to find out more, or email Ian Bradshaw or Clare Jeffries.

This guide is for general information and interest only and should not be relied upon as providing specific legal advice.