New Rules for Those Without a Will
[vc_row][vc_column][vc_column_text]From October, different rules come into force on how assets should be distributed when someone dies without making a will, but it is still likely to cause a shock to families, particularly where couples were not married or in a civil partnership
New rules on what happens when someone dies without making a will should make it easier for families in future, but the changes don't go far enough according to experts.
The Inheritance and Trustees' Powers Act 2014 received the Royal Assent on 14th May 2014 and is expected to come into force on 1st October 2014.
This includes changes to the intestacy rules, which govern how a person's estate is distributed if they die without a will - which is known as dying intestate'. The estate is made up of the assets owned solely by the person who has died, as any assets owned in joint names will pass automatically to the surviving joint owner, unless there is an agreement between the owners that they own the asset in specified shares.
The main change is that the surviving spouse or civil partner will now receive a higher proportion of the estate to use as they wish, but unmarried partners will still not benefit.
Under the old rules, where someone dies intestate leaving a spouse or civil partner and issue' - which means direct descendants such as children, grandchildren great grandchildren - the partner would take the first £250,000 and personal belongings absolutely, they would have a life interest in one half of the balance, and the children would take the other half of the balance. A life interest means that the surviving spouse is entitled to use the property or to receive its income until their own death at which point the property passes to the deceased's issue.
Under the new rules, the surviving spouse or partner still receives the first £250,000 and personal belongings absolutely, but they receive half the balance absolutely, so it is their own property. The remainder of the balance continues to go to the issue.
Another change is that under the new rules, where a person dies intestate leaving a surviving spouse or civil partner but no issue, the surviving spouse or partner will take the whole estate. Under the old rules the spouse or partner would take the first £450,000 and they would have to share the balance, if any, with the deceased's family, that is, their parents, siblings or nephews and nieces.
Another important change is that under the new rules, where a child is adopted after the death of an intestate parent, the child will not lose their interest under the deceased parent's estate even though under the Adoption and Children Act 2002 the adoptive parents are to be treated as the only parents of the child for all legal purposes.
But none of the changes make any provision for couples who have not gone through a marriage or civil partnership ceremony. In their case, none would go to the survivor, it will all pass to children or, or if there are no children, then it will go to family, such as parents or siblings.
Said wills and trusts expert Joseph Richardson, Partner of Eastbourne based solicitors Stephen Rimmer LLP: "The rules were last reviewed back in the 1970s. We've seen big changes in what defines family' since then, whether it's because people are less likely to get married or because we're seeing more blended' families following divorce and remarriage. Also, the value of property has gone up dramatically, so many more people who own property in their sole names are likely to be subject to the intestacy rules on how assets pass on.
"So, although these changes are certainly welcome, and well overdue, it remains the fact that without a will, you can't make sure that your family will be cared for in the way you would wish. Whatever your marital status it's worth doing - and if you're not married and have significant assets such as property in sole names, then it really should be top of your list. It's also particularly important where there is a second marriage, with children from previous relationships. "
He added: "Making a will is something that people often put off, but it's not a difficult or expensive thing to do, and it means you get the outcome you want."
Note:This is not legal advice; it is intended to provide information of general interest about current legal issues.[/vc_column_text][/vc_column][/vc_row]