Wills and Intestacy

Making a Will is one of those things that many people always plan to do, but for whatever reason don't get round to doing it. There can be many reasons for this, for example, it involves thinking about and planning for death, it is too complex or it is too expensive. Speaking of cost some people choose to do a Will themselves. The cost of making a Will is likely to be modest in comparison with the size of the assets concerned. The irony is that if a home made Will is found defective the costs of sorting out the legal problems arising after death could be many times greater than the costs of drawing up an effective Will in the first place

Many people can be quite surprised at the actual value of their estate once their home , investments, cash deposits and other personal assets are taken in to account. Without a Will you are considered to have died 'in testate' and the laws of intestacy apply. In English and Scottish law if someone dies with no surviving relatives all of their possessions after deducting the liabilities go to the Crown . Please note that Scottish law differs in a variety of ways from the law of England and Wales and this article deals only with the position relating to Wills as it stands in England.

Under normal circumstances to make a Will you have to be over the age of eighteen (there are exceptions to this), of sound mind and able to look after your affairs at the time the Will is written. If you are eligible to make a Will it must be in writing and then signed in the presence of two witnesses. The witnesses must then both sign their names at the end of the document.

Certain events can affect the validity of a Will. You could for example physically destroy an existing Will. You could effect a new Will that includes a statement that the previous one is invalidated (there is normally a standard clause within any new Will to this effect). Marriage in England and Wales invalidates a Will unless it is made clear in the Will that it will remain valid after marriage to a named person. If you divorce under English Law then from the date of the decree absolute your former spouse will no longer be able to benefit from your Will and any bequest by him or her would be void. Sometimes people fail to make a Will in the belief that everything will automatically go to their spouse. This is a regular misconception. Failing to make a Will is one way to die intestate. Other ways include making a Will that for some reason or another is not valid. Another way is to make a valid Will and then hide it away so securely that nobody can find it when you die.

As the intestacy law stands at the moment if there is a surviving spouse and issue (children) the surviving spouse receives a lump sum known as the statutory legacy and half the remaining estate for life. If the deceased leaves issue the statutory legacy is £125,000 which is increased to £200,000 if there are no children. In addition the surviving spouse receives all the deceased persons personal possessions. The intestacy rules specify the order of inheriting the deceased's assets as follows:-
Children or their issue
Parents
Brothers and sisters of whole blood or if deceased their issue
rothers and sisters of half blood or if deceased their issue
Grandparents
Uncles and aunts of whole blood or if deceased their issue
Uncles and aunts of half blood or if deceased their issue
If there are none of the above then the estate goes to the crown

Clients need to be thinking from an early age that a Will is something that should have a high priority. Once in place a Will should be reviewed at regular intervals even if the decision is that no change is needed. If a major event occurs in their life then the Will should be reviewed at that point to ensure that their wishes are still met by the existing Will in the light of the changed circumstances.

For anybody with assets in excess of the Inheritance Tax (IHT) band, currently £250,000 a Will should be considered mandatory. Those with significant assets should view a Will as an opportunity to engage in legitimate tax planning.