It is not surprising that most people find it quite difficult to get around to making a Will. It can be hard to face up to one's own mortality and often when people are considering making a Will it is after somebody close has died. However, if you do not make a Will then you lose control over what happens to your estate following your death.

What happens if I die without a Will?

Where a person dies without having made a Will that person is said to have died intestate and the law sets out in a prescribed manner how their estate should be distributed called the Intestacy Rules. The persons who may inherit under the rules of intestacy are restricted to spouses or civil partners, children, grandchildren and some other close relatives. Co-habitees or "common law spouses", close friends, carers or charities cannot benefit under these Intestacy Rules. Divorced spouses or former partners of a civil partnership are also unable to inherit under the Intestacy Rules, although they can still inherit if they are only informally separated.

It is very important therefore for co-habiting couples to make Wills to ensure that their estates will be left to each other.

It is also a common misconception that those who are married or in a civil partnership will automatically inherit their partner's entire estate under the rules of intestacy. This is not the case under the current law. What provision is made for the surviving spouse or civil partner under the Intestacy Rules depends on the size of the deceased spouse/civil partner's estate and whether there are children or remoter issue of the deceased spouse/civil partner surviving.

For example, if there is a surviving spouse/civil partner and surviving children, grandchildren or great grandchildren and the estate is valued at more than £250,000.00, then under current law the surviving spouse/civil partner will inherit the first £250,000 of the estate (as well as all personal effects) and a life interest in half of the balance of the estate. A life interest means that the surviving spouse/civil partner is entitled to receive the income from that half of the estate but cannot receive the underlying capital. The other half of the estate is left to the surviving children or grandchildren outright on attaining the age of 18. On the death of the surviving spouse/civil partner the half share of the estate in which he or she had the life interest is then also distributed to the children/grandchildren on attaining the age of 18.

If there are no children or grandchildren, then the surviving spouse/civil partner inherits the first £450,000 (and the personal effects) and is also entitled to half of the balance of the estate outright (ie both capital and interest). The remaining half share of the estate is left to the parents or siblings of the deceased spouse/civil partner.

How do the Intestacy Rules Work in Practice: An Example

David is married to Jane and they have an adopted daughter called Anna. David dies without leaving a Will and with an estate worth £600,000 excluding personal effects of nominal value. After Jane inherits her legacy of £250,000 and the personal effects, the amount left in the estate is £350,000. Jane gets a life interest in half of this (£175,000). She cannot spend the £175,000 capital itself and it should be invested to provide Jane with an income during her lifetime. The other half of the estate goes to Anna outright when she reaches the age of 18. Until then, trustees will have to manage Anna's inheritance on her behalf. On Jane's death the funds in which she had a life interest go to Anna when she is 18..

If David and Jane had no children but David's parents were still alive, Jane would receive David's personal belongings, a lump sum of £450,000 and half of the rest of David's estate outright (£75,000) with the other half of the estate passing to David's parents in equal shares.

It is unlikely that most couples would be happy with the above results but that is the current default position although significant changes to the Intestacy Rules are to be made shortly. If there are no surviving relatives who can inherit under the Intestacy Rules then the entire estate passes to the Crown and this is known as "bona vacantia". The assets are collected by the Treasury Solicitor and are used for general public spending.

Jointly Owned Assets and the Family Home

Many couples jointly own their home. There are two different ways of jointly owning a property; as joint tenants or as tenants in common. Where a couple owns a property as joint tenants and one of them dies, then at the date of death the survivor automatically inherits the deceased partner's share of the property by "survivorship" irrespective of the terms of any will or the Intestacy Rules. However, if the couple hold the property as tenants in common, then the survivor does not automatically inherit the other person's share of the property and it will devolve in accordance with the terms of the deceased person's Will or where there is no Will, then in accordance with the Intestacy Rules.

Unmarried and Co-habiting Couples

If couples are unmarried but cohabiting and one of them dies, as we have seen, the surviving partner will have no right to inherit under the intestacy provisions regardless of how long they have lived together and even if they had children together. Upon intestacy, co-habitees would have to bring a claim against the estate under the Inheritance (Provision for Family and Dependants) Act 1975. This is not only unpleasant, unsettling and stressful but such litigation is often very expensive and unpredictable and is completely avoidable as you can make a Will to ensure there is suitable provision for your partner on your death.

Inheritance tax

Another good reason to make a Will is that it is possible to put in place inheritance tax planning measures which can potentially help you save thousands of pounds worth of inheritance tax depending on your circumstances. For example, any assets passing to a surviving spouse or civil partner are exempt from inheritance tax (although, this does not extend to assets which pass to a co-habitee). It is therefore typical for most married couples to leave their estate to each other on the first death to obtain the benefit of the exemption.

So, why should I make a Will?

Ultimately, making a Will gives you control over your assets and ensures that you have provided for those close to you who you would want to benefit from your estate. The alternative is allowing the current Intestacy Rules to determine who should inherit your estate which may result in unintended relatives benefiting at the expense of others closer to you or worse, that those closest to you receive nothing at all.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.