If you die without a valid Will, then you are said to have died intestate and your estate will be distributed in accordance with the intestacy rules that are set out in statute. The intestacy rules are fixed, and they often do not reflect how you would want your estate to be distributed.
If you die without a Will and you have a spouse or civil partner, then the intestacy rules say that the surviving spouse or civil partner will receive a fixed lump sum. The current sum is £250,000, but this will increase to £270,000 on 6th February 2020, in alignment with the consumer price index.
If your estate is worth more than the specified sum and you die without a Will leaving a spouse or civil partner and children, then the value of your estate exceeding the specified sum will be divided equally between your surviving spouse or civil partner and your children. The children’s half will be held on trust for when they reach 18, which parents often feel is too young.
The intestacy laws could cause difficulties if, for example, the family home is worth more than the specific sum of £270,000 and is in your name only, then this would result in your children owning part of the family home that your surviving spouse or civil partner also partly owns and lives in. This could cause conflict if your children are estranged or if your children are from a previous relationship. Furthermore, if your children go through divorce or bankruptcy proceedings in the future, then the family home could be included in those proceedings. It could also cause problems for your children when they want to buy their own properties.
If you have a spouse or civil partner and children, and if you want to ensure that you surviving spouse or civil partner has access to all of your assets, then it is essential that you have a Will in place to override the intestacy rules. If you have an unmarried partner, then he or she will not inherit under the intestacy rules and so it is important to make provision in a Will if you want to leave assets for your partner.
At Myerson we offer a tailored service and all our team are STEP qualified, which means that we have undertaken additional training to allow us to advise on inheritance tax, trusts and complicated estates. If you require any further information please call us on 0161 941 400 or contact us via email.