Statutory Legacy Increase

The statutory legacy is increasing from £270,000 to £322,000 from 26 July 2023.

This is a fixed amount set by legislation that a spouse or civil partner will receive when a person dies without making a will (known as `intestacy`) leaving surviving children.

If the deceased had children, then the spouse or civil partner will inherit the first £322,000, personal property, and 50% of the remainder. The other 50% passes to the children equally.

However, if the value of assets in the estate is modest and below the statutory legacy then everything will pass to the spouse or civil partner.

The increase reflects rising inflation and changes in the Consumer Prices Index (CPI).

If the deceased had no children then the whole estate passes to the surviving spouse or civil partner.

The increase is welcome, but we do not recommend relying on the intestacy provisions and would always advise a client to make a will. The process is straightforward. You can select your executors (someone you trust to administer your estate after your death) and make provision for specific beneficiaries.

Remember that cohabitees, stepchildren, or friends do not benefit on intestacy and will only receive an inheritance if you make a valid will and include them as beneficiaries.

The intestacy rules can produce practical problems that you may not have anticipated.

The average house price in England & Wales in April 2023 was £286,489. Consider a married couple with children. If the deceased held the property is their sole name, under the current rules, the first £270,000 passes to the spouse and the remainder is split between the children. This could require the property to be sold so assets can be distributed between the beneficiaries.

From 26 July 2023, an average house will pass to the spouse as part of the statutory legacy, and this potential problem is averted.

If you wish to make a will or discuss how the intestacy rules could affect your estate, please contact or private client specialists https://www.rutherfordslegal.com/wills-probate/

Tony Illsley

Solicitor & head of private client department