The intestacy rules are changing from 1 October 2014. In this article we outline the new inheritance rules when someone dies without a Will.
When someone dies without leaving a Will, in legal terms they are said to have died 'intestate'. As the deceased hasn't left a Will outlining their wishes, their assets and possessions (known as 'estate') are distributed according to the rules of intestacy.
From 1st October 2014 the Inheritance and Trustees' Powers Bill will be introduced which will simplify the rules of intestacy in England and Wales.
The Bill also makes changes which may affect existing Wills.
The changes are as follows:
From October if a person who has a spouse or civil partner but no children dies without a Will, their surviving spouse/civil partner will inherit everything.
This differs from the current rules which state that if a person who has no children dies intestate the surviving spouse/civil partner will share their estate with the deceased's surviving parents and siblings.
Under the new rules when a person dies without a Will and leaves a spouse and children behind, the surviving spouse will receive the Statutory Legacy of £250,000 (as now), plus the deceased's personal belongings (known in legal terms as 'personal chattels') and half of their estate automatically.
The surviving children will then inherit the remaining half share of their deceased parent's estate on trust until they reach the age of 18.
Previously the spouse would only be entitled to receive the income of the half share of the estate, which would then pass on to the children when the surviving spouse dies.
The Statutory Legacy (mentioned above in point 2) will now increase, at least every five years, in line with the consumer price index.
The new Bill has introduced a new definition for personal chattels (mentioned above in point 2). It now covers all tangible movable property, except for property which:
This change in definition may impact existing Wills, so we advise that you update your Will accordingly.
Published on: July 5, 2014