Wills are not just for the old!

Wills are not just for the old!

The Mail on Sunday printed an article that should resonate with much of the UK population, explaining the consequences of Rik Mayall’s death, intestate at 56. (See the original article at http://www.dailymail.co.uk/news/article-3045275/Rik-Mayall-s-family-face-huge-tax-bill-failed-make-deal-1-2million-estate.html).

The article makes a point of the tax consequences, but the upheaval and stress created is also a factor. The big deal about the rules of intestacy is that the people who will benefit from your assets on death are not those you would automatically expect. In summary, the rules are below:

For unmarried couples; there is no provision for ‘common law’ partners; estates follow blood, so children and other blood relatives will inherit but unmarried or non-civil partners get nothing by default. Only a will can change that situation. 

For Married couples/civil partners with no children; married spouses are entitled to the whole estate by default. Only issue, (children), or a valid will can change the situation.

Married couples and civil partners with children; the surviving spouse will get the first £250,000 outright and 50% of the remainder outright. The 50% balance goes to the deceased’s children. 

Adopted children; a child of the deceased, even if previously adopted, may inherit.

If the deceased has no surviving children or direct descendants, (great grandchildren etc.); the estate is inherited in this order:

i)    Your parents

ii)    Whole blood brothers or sisters or their children if they pre-deceased you

iii)    Half blood brothers or sisters or their children if they pre-deceased you

iv)    Your grandparents

v)    Your whole blood uncles or aunts or their children

vi)    Your half-blood uncles and aunts or their children

vii)    The Crown.

So, words to the wise:

1)    Do not rely on not being old as being the reason not to have a will. Once you have assets to leave or family to give it to, write one! At the very least appoint a guardian for your children, or they could be subject to the tender mercies of social services. 

2)    Whether you are happy with the distribution of your assets on your death using these rules or not, make a will. Executorship is much easier than obtaining representation, so for the sake of those left behind, write a valid will.

3)    Sorting the tax consequences out will require a Deed of Variation. All of the potential beneficiaries need to agree, so this can get very difficult if some children are over-stretched financially. It would be easy for the remaining family to fall out over money. A will gets your feelings clear and gives your advisers something to work with. 

4)    If you have no family to leave your estate to, write a will and appoint an executor to distribute your assets to charities of your choice. The Crown will not get your money and the charities will get it much faster.

5)    If you hate your relatives, then item 4 above applies. If you really hate your relatives, die intestate and leave those who feel entitled to fight it out in Court! 

If you would like to know more about how we can help you plan and realise your financial goals then contact us at info@martin-redmanpartners.co.uk or call us on 01223 792 196.

The information contained is for guidance only and does not constitute financial advice. It is based on our understanding of UK legislation, whether proposed or in force, and market practice at the time of writing. Levels, bases and reliefs from taxation may be subject to change. Accordingly no responsibility can be assumed by Martin-Redman Partners its officers or employees, for any loss in connection with the content hereof and any such action or inaction.