First change in intestacy rules since 2014

The House of Commons ruled this week (15 January 2020) that the statutory legacy for partners under the intestacy rules will increase to £270,000 as of 6 February 2020.

The update, which was due in October 2019, has been welcomed by the Law Society. The government last updated the statutory legacy figure in October 2014, where it was raised to £250,000 for spouses under the intestacy rules. In line with the government’s 5 year updates, this will soon be increasing to £270,000.

What are the intestacy rules?

The intestacy rules apply if an individual dies without leaving a valid will. This is known as the individual dying intestate.

The rules of intestacy provide various provisions depending on what relatives the intestate left behind. A surviving spouse under the intestacy rules must survive the deceased by 28 days, otherwise the estate will be distributed as though there were no surviving spouse.

If the intestate had a surviving spouse but no children, the spouse inherits the entire estate, free of inheritance tax as it is captured by the spousal exemption.

If there is a surviving spouse as well as children, the intestacy rules differ slightly. The spouse will receive all personal chattels absolutely, for example any personal or domestic items. The spouse will also receive a statutory legacy of £270,000 (an increase from £250,000). The remainder of the deceased’s estate, or the residuary estate, will be divided into one half for the spouse and the other half for the children.

Where there are only surviving children, they will receive the residuary estate on trust until they attain the age of 18, or marry before the age of 18.

In the event that there is no spouse and no children, the estate will be distributed in the following order:

• Parents
• Brothers and/or sisters of the whole blood
• Brothers and/or sisters of the half blood
• Grandparents
• Uncles and/or aunts of the whole blood
• Uncles and/or aunts of the half blood
• The Crown, Duchy of Lancaster or the Duke of Cornwall

However, the increase in the statutory legacy for spouses should not be seen as an alternative to making a will. It is worth remembering that cohabitants, life partners and close friends are not included under the intestacy rules, no matter how long they have lived together. Therefore, the only way to provide peace of mind and ensure your loved ones inherit, is to make a valid will.

Here at Birkett Long, we have a team of specialist wills, trusts and probate lawyers who would be happy to help if you would like to discuss making a will, estate planning, or reviewing your current will.

I am based in our Colchester office and can be contacted on 0330 818 3071 or [email protected].