I'm married and just want to leave everything to my spouse. We have no children. Surely I don't need to make a will to do that?
Yes you do. If you die without making a will (ie you die 'intestate'), fixed legal rules apply to determine who is entitled to your 'estate' (ie what you leave).
If you die intestate but have assets of less than £450,000, then your spouse (or civil partner if you are legally united in a civil partnership) will be entitled to everything, no matter how many other close blood relatives (parents, brothers, sisters, nephews or nieces) you have
The same applies if you die intestate with assets of more than £450,000, but none of your close blood relatives is still alive.
But if you have assets worth more than £450,000, and die intestate with close blood relatives still alive, your spouse or civil partner only gets:
- your personal effects.
- the first £450,000 of your other assets.
- half of what's left.
The remaining half goes to:
- your parent(s) - an equal share to each if both are alive. If they are both dead:
- your brother(s) and/or sister(s), equally. If any have died before you, their share is divided among their children (your nephews and nieces).
These rules override any informal wishes you may have expressed.If, for instance, you want to leave a gift to the woman who comes to keep the garden under control, you need to put it in a will.
There is also the question of inheritance tax. If:
- the value of your estate on your death; and
- the value of anything you have given away within the past seven years
amounts to less than £325,000, inheritance tax will not be payable on your death: £325,000 is the current (2009-10) level of the general exemption from inheritance tax (the amount you can leave without attracting any inheritance tax). This amount is reviewed every year in the budget.
If, however, they amount to more than that, your estate is potentially liable to inheritance tax (see question 22). Assets passing to your spouse or civil partner are exempt from inheritance tax, but those passing to your parents or other relatives are not. Tax planning can generally reduce liability to inheritance tax, so if you think your estate may be liable, take advice - which will often include advice to make a will.
Even if everything goes to your spouse or civil partner, and is therefore exempt from inheritance tax on your death, you should consider what will happen on your spouse's or civil partner's death if they die later than you. Any unused part of your nil rate band can be 'inherited' by your surviving spouse or civil partner, and added to their own nil rate band but if your assets, when 'bunched' together with theirs, could create or increase, the inheritance tax liability on their death, consider taking tax planning advice. Again, this will often include advice to make a will.
