Surviving spouse entitled to greater share of estate if no will in place
Anyone who dies without having drawn up a will is said to have died ‘intestate’ and the intestacy rules dictate who can inherit, in what order, and the amount to be passed on.
If one person in a married couple or civil partnership dies, the surviving spouse automatically inherits the entire estate if there are no children.
But where there are children, the intestacy rules provide for them, as well as the surviving spouse.
Under new rules which have come into effect today (6 February) in England and Wales, the surviving spouse will inherit the first £270,000, plus half of the remaining estate with the other half split equally between children.
This figure is up from the previous £250,000 threshold set in 2014, which has now been uprated to keep pace with inflation.
‘Don’t rely on rules of intestacy in place of making a will’
While the intestacy rules state how an estate is to be divided among beneficiaries such as a surviving spouse and direct descendants, there is no automatic provision for cohabiting/unmarried couples, stepchildren or anyone else you may want to leave your estate to.
It could also mean a spouse you separated from years ago could reap the benefits.
Sarah Coles, personal finance analyst at Hargreaves Lansdown, said: “If you’re not married, the problems multiply if you die without a will. It doesn’t matter how long you’ve been together – aside from any jointly owned property or accounts, your estate will go to your children. If you have no children it will pass to other family members, so if your property is in your name alone, your partner could lose their home.
“Making a will is the only way to ensure you give money to the people you want to benefit, at the right time, and in the way that suits you best.”
Ceri Webster, associate in the trusts and estates administration team at law firm Hugh James, said: “In many cases the family home is the largest asset and the rules could potentially leave your spouse sharing ownership with your children which may, in some families, cause complications.
“Also if your estate is valued at less than £270,000 then your children would not be provided for at all.
“If you do not have a will in place, you could also be missing out on the benefits of estate and tax planning which would be used to protect your assets and provide for your loved ones.”
To help, Hugh James has created an Intestacy rules flowchart to see how an estate is divided upon death.