Total or partial intestacy can affect your entitlement to inherit and the extent to which you can inherit certain assets from a deceased person.
The Intestacy Rules are different in England & Wales, Scotland, and Northern Ireland. When someone dies and that person is connected to more than one country, various factors such as their place of birth, nationality, place of residence, where they work and where their family live are used, together with other criteria to determine which country’s succession laws apply to their estate. Legal advice should be sought in this situation. The information below concerns the operation of the Intestacy Rules in England & Wales
The Intestacy Rules, which are set out in law, only apply to property and possessions which could have been passed on by a Will. Some types of assets can never pass under a Will or in accordance with the Intestacy Rules. These might include, benefits from a life assurance policy, death in service benefit or under a pension scheme which often pass outside of these rules. Similarly, if the deceased, owned assets jointly, on their death, their share of that joint asset may pass automatically to the surviving co-owner(s) under a right of survivorship.
A total intestacy happens when a person dies without having made a valid Will. This may be because the deceased never made a Will or because the Will is invalid for some reason i.e. witnessed incorrectly. It can also arise because of events occurring after a valid Will is made which result in all the gifts under the Will failing, for example all the named beneficiaries in the Will having died before the deceased and there is no provision for substituted beneficiaries.
A partial intestacy arises where the deceased has left a valid Will but it does not dispose of all of the deceased’s assets capable of being inherited under a Will. In these circumstances, any assets effectively dealt with by the Will are inherited according to its provisions and the remaining assets are inherited in accordance with the Intestacy Rules.
In a total intestacy, the deceased’s personal representatives must pay the deceased’s debts, funeral expenses, any taxes that are due, and the costs of administering the deceased’s estate from the assets forming the intestate estate. The balance remaining is known as the residuary estate and is distributed in accordance with the Intestacy Rules.
The right of a person to benefit on an intestacy depends on that person’s relationship with the deceased and on which other relatives have survived the deceased. The rules list the categories of beneficiaries in order of priority. The general principal is that the residuary estate is shared between relatives in the highest category, excluding those in lower ones. However, if there is a surviving spouse or legal civil partner (only same sex couples can enter into legal civil partnerships) the division is more complicated. That person takes priority, although they may have to share the residuary estate with other beneficiaries depending on the value of the residuary estate. It should be noted that a surviving spouse or civil partner has to survive the deceased by 28 days in order to inherit under the Intestacy Rules. In the case of a married couple or civil partners who both die in circumstances which mean it is uncertain who died first the younger is not deemed to have survived the elder. Instead it is presumed that each spouse or civil partner predeceased the other with the result that the rights of the surviving spouse or civil partner are ignored when distributing under the intestacy rules.
A person who is not related to the deceased i.e. an unmarried cohabiting partner that is not a legal civil partner, has no automatic right on intestacy to a share in the residuary estate, although they may have a claim against the estate if they evidence financial dependence on the deceased. For the purposes of intestacy, a judicially separated couple is treated like they are divorced or widowed, whereas a conventionally separated couple are treated essentially as if they were still married. Divorced spouses or civil partners whose civil partnership has been legally ended do not inherit under the Intestacy Rules.
Step children and in-laws do not inherit under the Intestacy Rules. Adopted children are treated as if there are related to their adopted parents and not their natural parents in an intestacy. It is sometimes possible to rearrange the way property is shared out when someone dies totally or partially intestate, provided this is done within two years of the death by executing a deed of variation. With the agreement of those who would otherwise have inherited under the Intestacy Rules the deceased’s property can be shared out in a different way. A beneficiary under the intestacy may be able to give away some of their inheritance so that those that do inherit can receive a share that is different to the amount they would get under the rules of intestacy, or so that people who do not inherit under the rules can still get some of the estate. It is important to take legal advice if you wish to vary your inheritance.
A good place to start to work out who is entitled if your loved one has died intestate is https://www.gov.uk/inherits-someone-dies-without-will
If you do not have a valid Will, those you love may not inherit on your death what you would want them to receive.
If you wish to discuss Wills or any other legal issues please contact Lisa Maley on 01892 526 344 or lmaley@berryandlamberts.co.uk.
The contents of this article are for the purposes of general awareness only. They do not purport to constitute legal or professional advice. The law may have changed since this article was published. Readers should not act on the basis of the information included and should take appropriate professional advice upon their own particular circumstances.
