Intestacy: What Happens if I Do Not Leave a Will?

In the UK, approximately one in three Britons do not have a valid Will and a large proportion of those that do have a will admit to it being out of date. This is concerning as failure to leave a valid Will often leads to additional costs in dealing with the administration of an estate and assets not necessarily going where the deceased wished them to go.

Rules of Intestacy

An intestate person – one who dies without a valid Will – will have their estate executed in accordance with the ‘Rules of Intestacy’. The Rules of Intestacy include:-

Married/ Civil Partners - with no children. Under the rules, the surviving spouse will inherit the entire estate providing they survive more than 28 days after the deceased passes.

Married / Civil Partners - with children or grandchildren

If the deceased has children, the spouse will inherit the first £250,000 and half of the remaining estate. The rest of the estate will be divided between the children. This will be held in a trust if the children are under the age of 18, unless they marry before then. This can be best illustrated in the following example:

John is married to Sarah with three children: Tim, Tom and Ted.  Unfortunately, John passes away with an estate worth £800,000.  As a result, Sarah will inherit the first £250,000 and £275,000, which is half of the rest. The remaining £275,000 will be split equally between their children.It is important to note that irrespective of whether the children are from different marriages, the estate will still be split equally between them.

Unmarried with children

 If the deceased has children and has a partner but they are not married, the estate will go to the relatives, with the children first in line.

E.g. Stacey and Ben have been living together, but are not married, for 35 years. They have two children: Jane and John who Ben is no longer in contact with. Sadly, Ben passes away and leaves an estate of £800,000. Stacey receives nothing and Jane and John inherit the entire estate, sharing £400,000 each.

Relatives

• Married/Civil Partner, with relatives
  
  
  • If the deceased was married with no children, the surviving partner will receive the entire estate. This is a change from the position pre October 2014 legislation.

•  Unmarried, no children
  
  
  • If the deceased was not married and had no children, the estate will be distributed against any biological living relatives. The hierarchy for who will receive payment is:
    
    
    • Grandchildren
    • Parents
    • Full siblings
    • Nieces and nephews
    • Half siblings
    • Half-blood nieces and nephews
    • Grand parents
    • Uncles and Aunts – full relation
    • Uncles and Aunts – half relation

• No surviving relatives
  
  
  • In the case that there are no surviving relatives and there is no Will, ‘Bona Vacantia’ will apply. Bona Vacantia is the term given to property which has no owner, which is by law, passed to the Crown as there is no relatives to claim ownership.

Joint Assets

The rules are different for jointly held assets – these usually pass by survivorship. For example, if a property is held jointly, it will pass automatically to the joint survivor on death. If, however, the property is held as “tenants in common” it does not pass automatically to the joint survivor but passes in accordance with the terms of the will or the Rules of Intestacy above. Other joint assets (like bank accounts) do not necessarily pass automatically to the joint survivor following recent case law decisions.

Invalid Will

It is important to recognise that Wills which leave room for speculation will be considered void and made invalid. As a result, the estate will be subjected to the Rules of Intestacy. Anything from not writing a person’s name out in full, incorrect witnessing of the document or not specifying the specific item you wish for the inherited to receive, can invalidate a Will.

Consequently, writing a will is important for anyone who wishes to fairly distribute their estate upon passing and to ensure their wishes are met without interference from the Rules of Intestacy. Being that  ‘Common Law’ marriages and long term partners are not recognised within Intestacy rules, or anyone outside the family or any causes, a Will helps to clarify where you wish for your money to go.

If you wish to find out any more information on intestacy or would like to seek advice on how to form a will, please contact Paul Dell on paul@raffingers.co.uk.