According to research, less than 50% of adults in the UK have a valid will.
Whilst many people may not think they need a formal will, without one your estate will be distributed strictly in accordance with the intestacy rules.
The intestacy rules are laid down in law and will dictate how your estate is distributed. These rules distribute your estate according to both your marital circumstances and surviving offspring and relatives. The rules are complicated and can often create unintended consequences.
For example, if a married man dies leaving a widow and two children, his estate would be divided as follows:
However, if the children’s parents had never married, or formed a civil partnership, then the entire estate would pass to the children only. Under the intestacy rules, their mother would receive nothing. Furthermore, married couples who have informally separated would still stand to inherit a significant proportion of their spouses’ estates.
Whilst we would always advise on the importance of having a valid will and ensuring that this is updated regularly, if someone does die intestate it may be possible to vary the final destination of their assets, provided those inheriting under the intestacy provisions are willing to give up some of their inheritance.
This may not of course always be possible and if minors are inheriting under the intestacy provisions a Court application would be required to vary the rules.
Recourse can also be made through the courts to vary the distribution of the estate on intestacy cases under the Inheritance (Provision for Family and Dependants) Act 1975, although claims under this route can be costly and can take a long time to reach any conclusion.
Many people are also unaware that getting married causes an existing will to be revoked and could inadvertently cause a newly married couple’s position to become intestate.
Couples often jointly own their own home or have joint bank accounts. Property or assets owned jointly as “joint tenants”, rather than “tenants in common”, will pass to the surviving partner automatically on death. This applies regardless of whether the couple are married or in a civil partnership, or cohabiting.
Such property which passes jointly in this way does not form part of the estate of the deceased when applying the intestacy rules and thresholds.
Should you wish to discuss how best to secure your own position or that of your family, please contact a member of our Probate team.