Making a Will is the only way to indicate who you want to benefit from your estate. Failure to take action could compromise the long term financial security of your family.
It’s also the cornerstone for inheritance tax and estate planning. Yet previous studies have suggested that as many as a half to two thirds of the adult population have not made one (National Consumer Council 2007). This inertia could be due to the perceived expense of making a Will, an unwillingness to accept that we’re all mortal or a misunderstanding of the law in this area. A common misconception might be that writing a Will is unnecessary as everything will pass to the spouse on death. While this might be true where the size of an estate is relatively modest it will not always be the case.
Intestacy in Scotland
The intestacy rules in Scotland are contained in the Succession (Scotland) Act 1964. These state that certain rights that must be satisfied before the balance of the estate can be distributed.
They also apply even where the deceased left a valid Will.
Prior rights The surviving spouse is entitled to:
– The deceased’s interest in the family home. The value of this interest increased to £473,000 from its previous level of £300,000 on 1 February 2012 to reflect the increase in property values since it was last increased in 2005. Where the value of the property exceeds this figure, the surviving spouse is entitled to a lump sum of £473,000 in place of the property.
– The right to furniture and moveable household goods up to £29,000 (£24,000 before 1 February 2012).
– A legacy of either £50,000 where there are surviving children or £89,000 otherwise (£42,000 and £75,000 previously).
The surviving spouse is entitled to a share of the deceased’s remaining moveable estate – for example cash, shares and jewellery, after creditors have been paid:
– One third of the moveable estate where there are surviving children.
– One half of the moveable estate where the deceased left no surviving children.
Any remaining estate would pass to remoter beneficiaries and if none, the Crown.
“Put simply, failure to take action could compromise the long term financial security of your family.” Duncan R Glassey CFP AIFP MCSI FRSA