If I do not leave a Will does my Spouse/Civil Partner get the whole of my estate?

In simple terms the answer is no.

It is a common misconception that if you pass away without leaving a Will then your surviving spouse/civil partner would benefit from the whole of your estate.

If you pass away without making a Will you are deemed to have died intestate. In brief, this means that rather than your estate passing under the terms of your Will, it passes in accordance with the law (often referred to as the Intestacy Rules).

Under the Intestacy Rules, there is a strict order of entitlement as to who will benefit from your estate.

If you pass away leaving a surviving spouse/civil partner and issue (i.e children or thereafter grandchildren) then your estate will be distributed as follows:

Your spouse/civil partner would receive all of your personal chattels;
Your spouse/civil partner would receive a lump sum of Ł125,000 (known as the Statutory Legacy);

The remaining part of your estate (known as the residuary estate) would then be divided into two equal funds:

In relation to one half, your spouse/civil partner would be entitled to a life interest in it (this means that your spouse/civil partner would receive the income from this half during their lifetime and the capital value of this half would pass to your children (or grandchildren) once your spouse/civil partner has passed away);
In relation to the remaining half, it would pass to your children (or grandchildren) in equal shares contingent upon them attaining the age of 18 years old or earlier if they are married or have entered into a civil partnership (this is known as being held on a Statutory Trust).

If you pass away leaving a surviving spouse/civil partner only, and no issue, then your estate will be distributed as follows:

Your spouse/civil partner would receive all of your personal chattels;
Your spouse/civil partner would receive a lump sum of Ł200,000 (again known as the Statutory Legacy);

Again, the remaining part of your residuary estate would then be divided into two equal funds:

In relation to one half, your spouse/civil partner would be entitled to half (with no life interest);
In relation to the remaining half, this will either pass to your parents in equal shares or to the survivor of them. If your parents have not survived you, then it will go to your brothers or sisters in equal shares. If there are no surviving brothers and sisters, then your estate could go to other family members.

Please note the above does not apply to any part of your estate that is held jointly with another person (as joint tenants). If you do own an asset as joint tenants (i.e such as your house or bank account) then this asset will pass automatically to the surviving joint owner.

It must also be noted that the government has recently reviewed concerns that the statutory legacy is too low. As a response, the Ministry of Justice have proposed to raise the level. From the 1st February 2009 the new levels of the statutory legacy will increase to Ł250,000 (where survived by spouse/civil partner and children) and Ł450,000 (where only survived by spouse).

Although the new levels will go some way to provide extra protection to spouses and civil partners, everyone should always consider making a Will to ensure that their estate is distributed in accordance with their wishes.

2 OCTOBER 2008

For further information on Linder Myers expertise in dealing with the issues raised in this article please contact:

JON GOULD
TRUSTS AND ESTATE DEPARTMENT
0161 837 6855
jon.gould@lindermyers.co.uk