Over one million cohabitants stand to inherit nothing

The Law Society has warned that more than one million unmarried and same sex couples not in a civil partnership will inherit nothing if their partner dies without a will and has dependent children.

Under intestacy laws, dependent children will inherit the entire estate of the deceased, while the cohabiting partner will stand to inherit nothing.

The rules on who will inherit the estate of someone who dies intestate were recently updated through the Inheritance and Trustees' Powers Act 2014, which strengthened the position of married spouses and civil partners, but left the position of cohabiting couples unchanged.

Andrew Caplen, president of the Law Society, said that under the rules, assets passing to children are held in trust until they reach the age of 18, potentially leaving the surviving partner in an emotional and financial mess and with no access to vital funds to help them cope.

"Further, these assets must be paid to the child when they turn 18 - there is no other option. Many people would regard 18 as far too young to receive what could be a substantial sum of money," he said.

"A properly drafted will can ensure trustees hold the sum until a later age when children are more able to deal with an inheritance.

Caplen added that the only way couples who do not wish to marry or enter a civil partnership can ensure that their spouse does not encounter financial difficulties on their death is to draft a will.

"These changes are a reminder of the importance of having a will. Dying without one, not only means your final wishes go unmet, but could leave problems for your loved ones to sort out. Don't make this mess your legacy," he advised.

Slow to adapt

James Ward, a partner at Seddons Solicitors said at the time changes were made to the intestacy laws that the law has never been able to keep up with the changing structure of family dynamics.

"This new Act is a prime example of the law's inability to respond quickly to changing family situations and structures as unmarried, cohabiting partners still have no legal intestacy rights," he said.

"The reforms go some way towards modernising what is often deemed an archaic and arbitrary process, but for cohabitees, intestacy law offers no further clarification or protection.

He echoed Andrew Caplen's sentiments in advising people to draw up a will clearly expressing their wishes, as it may be the only way to ensure final wishes are respected.

"The only way to truly protect your assets and guarantee your inheritance is by drafting a will to represent your wishes."

Binyamin Ali is assistant editor of Private Client Adviser