More than ever, it is important to get a qualified solicitor to draw up your Will.
Across the UK, thousands of people die each year without having made a will. Up until this year, this may have been a problem; now, thanks to a change in the law, it’s vital you get a proper will drawn up.
On 1st October 2014, the Inheritance and Trustees Powers Act came into force. The effects are wide-ranging, and mean big changes for everyone who doesn’t already have a will in place for when they die.
Before the new Act came into force, if you died without a will in place (known as dying intestate), then your affairs were governed by a strict set of rules which distributed your estate to your spouse and children in a set order. Unmarried partners were not protected and not automatically entitled to any share of the estate at all.
For years, the law specified that if you were married (or in a civil partnership) and had children, and you died intestate, then your spouse would receive a statutory legacy of the first £250,000 of your estate, as well as your personal belongings and a life interest (a right to the income, but not the capital) in half of any monies over and above £250,000 (the “residue”). Your children would receive the other half of the residue when they turned 18, and when you died, your life interest would also transfer to them.
For couples with no children, your spouse would receive the first £450,000 and one half of the residue, with the rest passing to your family members.
This has all changed. Now, if you die intestate leaving a spouse or civil partner and children, they will still receive the statutory legacy of £250,000, but this will be index linked and will rise every five years. They will also be entitled to half of the residue outright, rather than just a life interest. The children are then entitled to the other half of the residue absolutely once they turn 18. The new Act therefore leaves more to the spouse, and removes the life interest structure for the children.
At first glance, this looks like it would give increased protection to your spouse or civil partner, because they will end up with more. However, it could negatively impact on those who have remarried and who have children from their previous marriage, as it will be the current spouse or civil partner who receives the bulk of the estate, with the children receiving considerably less.
If you have no children, then your spouse or civil partner will receive everything, with nothing going to your parents or siblings. Again, this seems to offer more protection to a spouse or civil partner, but if you have remarried and have no children then your family members may feel they should receive a larger share of your estate than a second or third spouse or civil partner.
The Act also brings in some changes which affect adopted children. If a natural parent dies leaving a child under 18, and that child is then adopted by someone else, the adopted child will still receive their share of their deceased birth parents’ estate at 18, even though they are otherwise legally treated as a child of the adopted parent from the date of adoption.
There is still no such thing as a common law marriage, and so unmarried couples – regardless of how long they have been together – are still not protected. If you are not married and you or your partner dies intestate, the estate will be distributed according to the normal intestacy distribution order: children, parents, siblings. If you have no children, the estate will pass to your parents (provided they are named on your birth certificate, they will receive a share). The only way to make sure an unmarried partner will be provided for in the event of your death is to either get married, or make a proper Will.
If you don’t already have a Will, we recommend doing this as soon as possible. To book an appointment with one of our expert staff, call us on (029) 2034 2233 or e-mail [email protected].
Published: 27/11/14