If you have not made a Will you are leaving it to the State to determine how your assets should be distributed on your death.
If you die without making a Will you will be deemed to have died “intestate”.
The Intestacy Rules (which are set out in the Administration of Estates Act 1925) regulate who gets what if you die without making a Will.
Sometimes the Intestacy Rules reflect what the deceased would have wanted. However, in most instances, the application of the Intestacy Rules can have a completely unintended effect!
It can leave loved ones facing financial hardship and even lead to expensive inheritance disputes. We would not, therefore, recommend that you leave your estate to be distributed in accordance with the Intestacy Rules.
A quick guide to what happens under the Intestacy Rules: –
You are MARRIED, and your estate is worth less than £250,000
Under the Intestacy Rules, your surviving spouse gets everything.
You are MARRIED, and your estate is worth more than £250,000 and you have children
Under the Intestacy Rules, it now starts to get interesting and potentially problematic for the surviving spouse. All your personal belongings and the first £250,000 will go to your spouse. They will also inherit a 50% share of the remainder of the estate, with the other 50% being distributed to your children.
If any child should pre-decease you then their own children (your grandchildren) would inherit their parent’s share.
You are MARRIED, and your estate is worth more than £250,000, and you don’t have children.
The surviving spouse is now entitled to inherit the whole estate.
You are not married but have children
Under the Intestacy Rules, your children will inherit all your estate in equal shares. Again, if a child has predeceased you then their children will get their parent’s share.
You are not married and have no children
Under the Intestacy Rules, surviving relatives will inherit in the following order:
- parents
- full brothers or full sisters or their children
- half-brothers or half-sisters or their children
- grandparents
- full uncles or full aunts or their children
- half uncles or half aunts or their children
If you have no surviving parents, siblings, grandparents, uncles or aunts then under the Intestacy Rules everything will go to the Crown!
Things to remember:
- the Intestacy Rules do not recognise unmarried or common-law partners
- the Intestacy Rules allow a 28-day survivorship period
- the effect of the Intestacy Rules can be unfair, especially on surviving spouses. Surviving dependents may be entitled to seek more adequate financial provision by making a claim under the Inheritance (Provision for Family and Dependents) Act 1975
- the age at which beneficiaries can inherit under the Intestacy Rules is 18. Many people think 18-year olds are too financially immature to inherit large sums of money. In a Will, you can ensure that beneficiaries inherit when they are more financially mature such as at the age of 21 or 25
- the best way of avoiding the unintended consequences of the Intestacy Rules is, quite simply, to make a Will!
