Succession – who inherits what, after a person dies – can often be a complicated matter. This is one reason why everybody is encouraged to put a Will in place, as this deed can help mitigate some of the complexity and ambiguity. Where a Will is not in place, the rules of ‘intestacy’ apply which determine how your estate shall be distributed. The Scottish Government’s recently introduced Trusts and Succession (Scotland) Bill, which seeks to amend these rules, have not substantially changed since the 1960’s. 

The current law

At present, entitlement under the rules of intestacy is surprisingly convoluted.

The first element is the Prior Rights of a spouse or civil partner, which rank above all other entitlements after debts are paid. These rights are restricted to specific financial limits for each of the type of assets held in your estate.

The second element is the Legal Rights of spouses or civil partners, and/or children. This is an entitlement to a specific sum of the remaining ‘moveable’ estate assets.

Finally, the remaining value of the estate passes completely to a family member, in accordance with a pre-defined priority list. To date, this list has prioritised children, followed by parents and siblings. Where neither of these categories exist, the spouse or civil partner will inherit the remaining estate assets.

The proposal

Section 72 of the Bill aims to revise the priority list mentioned in this final element. The proposal is that a spouse or civil partner should inherit immediately after children and grandchildren i.e., de-prioritising parents and siblings. For some, this may bring the law closer to their own expectations of how their estate ought to pass. However, for others, such as those with estranged marriages or civil partnerships, this may allow distribution which would be contrary to their preferences. 

The best method of ensuring your estate passes as you wish is to put a robust and tax-efficient Will in place. If you would like assistance with this or any advice on the above mentioned matters, please do not hesitate to contact.