The government has confirmed this month that it has laid a statutory instrument to set a new statutory legacy (fixed net sum).
When a person dies intestate (without a Will) strict succession rules apply. The Statutory Legacy is the sum that is received by the surviving spouse or civil partner of a person who dies intestate, but with children. They are entitled to this first from the estate before the remainder is shared.
The current statutory legacy is £270,000, but this will increase to £322,000 at the end of July 2023. This is positive news for people who are struggling with the cost-of-living crisis.
The average house price in England and Wales currently stands at £286,489. With the previous legacy of £270,000 if a married person died, their property would have to be sold and then the first £270,000 would be taken by the spouse. The remainder would then be divided between them and their children. With the new figure, the spouse would be able to remain in the house.
This may leave you concluding that you do not need to make a Will. However, there are several reasons why it is beneficial to formalism your wishes in a Will.
By leaving a Will you can:
- Choose exactly who is entitled to your estate
- Unmarried couples- If you are unmarried, you will not benefit from the statutory legacy at all. You must make a Will if you wish for your partner to benefit from your estate
- Choose executors who will be the best to administer your estate
- Choose guardians- If you have young children, it is important to consider who would care for them if you were to die
- Tax efficiency- A carefully drafted Will can help to avoid paying any unnecessary taxes being paid from your estate
If you would like further advice on the benefits of having a Will, please contact a member of our team.
“This is good news for people struggling with the cost of living crisis and rising inflation,”https://todayswillsandprobate.co.uk/statutory-legacy-sum-set-to-be-raised-later-this-month/