Now we are all guilty of putting off things for another day, particularly the important things and especially when it comes to our Wills. It is a common thing to hear from friends, acquaintances and indeed some of my own colleagues, ‘Oh we must come to see you to do our Wills.’
But they rarely actually do so, as for some, that act of contemplating their death will somehow hasten it. Perhaps this is why so many people fail to make a will even when the consequences of failing to do so are so very costly.
Deciding who is going to be the guardians or trustees of your children may be difficult to decide even if who is to inherit is not. Surely this is all the more reason to sit down and think about what you want to leave behind when you pass away. For instance would you want your children to inherit a vast sum at 18 years or would you want them to be protected until a later date?
Sadly death comes to the prepared as well as the unprepared and there can be very sad resulting consequences for those who have not prepared because they think (wrongly) that ‘it will all go to my spouse anyway…’
The Intestacy Rules
If you die without a Will then the value of your estate and the identity of any surviving relatives will determine how your assets are distributed.
As of 1 October 2014 the rules have changed with the Inheritance and Trustees’ Powers Act 2014, coming into force.
Under the previous rules the spouse or civil partner (where there were also children) was entitled to the first £250,000 plus a life interest in half of the residuary estate (i.e. that which was left after the payment of tax, funeral and administrative expenses). The children would get the other half of the residuary estate and would also get the first half after the death of the surviving spouse.
That has now changed, so the spouse takes both the £250,000 plus half the residuary estate absolutely. The children share the remaining half of the residuary estate. If the estate is worth less than £250,000 the spouse takes everything. Where there is a spouse or civil partner but no children the spouse takes everything, whereas previously they only had the first £450,000.
There is no provision for cohabiting couples and the spouse or civil partner will take even if they were separated so for those who live together without being married having a Will is imperative.
However there is some good news for cohabiting couples in that the new act also brings in some changes to the Inheritance (Provision for Family and Dependents) Act 1975. This is the act under which claims can be brought against an individual’s Estate after death. In the past they had to show that the deceased was contributing more financially to the relationship than the party making the claim. In future the fact that a couple were mutually financially dependent should be sufficient.
Unlike many parts of Europe, in England and Wales we have complete freedom to leave our money to whomever we please. However your assets won’t necessarily go to who you want unless you take positive steps to ensure that you have made a correctly executed Will.
If you require any further information on this, then please do not hesitate to contact Sue Adams, a Solicitor, Partner and Head of the Private Client team specialising in Wills, Lasting Powers of Attoney and Grants of Probate on 01202 204561 or alternatively at [email protected].
We will only use this information to handle your enquiry and will not share it with anyone else.