The rules on inheritance for people not having a valid Will have changed
It is important to be aware of the changes as this could impact upon you if you have not made a Will, or if your Will does not provide direction as to whom should inherit in the event of the death of your first choice beneficiary.
“Common Law Partners” will be disappointed to learn that they still have absolutely no protection under the new rules.
When someone dies without making a Will the Intestacy Rules determine who gets what from that persons estate.
If the deceased’s persons estate is less than £250,000 in value, the rules will not impact upon the estate.
For those individuals who die with more than £250,000 in assets the changes are significant.
Under the current rules cohabitees, or common law partners, have no automatic right to receive anything and it does not matter how long you have lived together or if you have children together.
Under the new rules cohabitees and common law partners still get nothing. The only way to ensure that your partner or common law partner, or cohabitee receives anything is to make a Will or get married. This would of course bring with its own set of complications.
The biggest change relates to married couples and civil partnerships where there are no children. Under the previous rules if the spouse died without a Will and there were no children the first £450,000 of the estate plus half of the rest went to the surviving spouse. The other half was split between the deceased’s blood relatives meaning that the money could often go back to parents or brothers and sisters.
The new rules mean that the possibility of parents or other distant relatives receiving monies on death are more remote. From the 1st October 2014 the surviving spouse will receive the whole estate if there are no children. The rules are different if the couple have children. Under the old rules the married partner took everything up to £250,000 with a complex division of anything about this amount. Firstly the children would receive half of the balance above £250,000 immediately or on trust if they were under 18 and the remaining half would also go to the children but the surviving spouse would have a life interest whilst she was alive. This often meant that the interest was paid to the spouse but not the capital.
From the 1st October the life interest is abolished. The surviving married partner will take all of the first £250,000 and will then be fully entitled to half of the remainder. All the children will receive is half of anything above £250,000 and they will not receive that until they turn 18.
Our experienced solicitors in the Family Department can assist in providing further advice should it be required.
Please telephone Kerry Davies on 01524 39760 for an appointment.
We have offices at Lancaster, Kendal and Barrow in Furness.