In Scotland, if someone dies without a Will the laws of intestate succession will apply. The rules (called the “intestacy rules”) are set out in the Succession (Scotland) Act 1964, as amended (“the 1964 Act”), and they detail how an estate must be distributed when there is no Will.
The intestacy rules are broadly split into three separate parts.
Firstly, “Prior Rights”. Once the funeral expenses and any debts have been settled the Prior Rights of a surviving spouse (or civil partner) are considered. It is worth highlighting that Prior Rights only apply where there is no Will whereas “Legal Rights” (see below) must also be considered, depending upon the circumstances, even if someone dies having left a Will. The blog, however, considers the position purely from an intestacy perspective.
There are several elements to Prior Rights, the first of which relates to the deceased’s property. If the deceased owned a property (either wholly or in part), their spouse/civil partner is entitled to that interest up to the value of £473,000, provided they are resident in the property at date of death. The second element of Prior Rights relates to the contents of the property which the spouse/civil partner is entitled to, up to the value of £29,000 and, lastly, there is a cash element to Prior Rights with the spouse/civil partner having an entitlement to either (i) up to £50,000 if the deceased was survived by children, or (ii) £89,000 if the deceased did not leave any children.
Depending upon the circumstances, it may be the case that an intestate estate is exhausted by Prior Rights.
If, however, there is estate remaining for distribution after Prior Rights have been satisfied, then the second aspect of the intestacy rules must be considered, namely, “Legal Rights”.
The deceased’s spouse/civil partner and children have an entitlement to Legal Rights. Legal Rights apply to certain assets only – the “moveable” assets in the estate, meaning any assets such as cash in the bank, investments etc. but not land and buildings.
If the deceased is either (i) only survived by their spouse/civil partner and there are no children or, (ii) only survived by children with no surviving spouse/civil partner then, in either case, the surviving beneficiaries are entitled to a one-half share of any remaining moveable estate (any children being collectively entitled to share that one-half share).
If the deceased is survived by their spouse/civil partner and children, the spouse/civil partner and the children are each entitled to a one-third share of any remaining moveable estate. Again, the children are collectively entitled to share that one-third share.
If, after the Prior and Legal Rights have been satisfied, there is still estate remaining to be distributed, the third element of the intestacy rules applies. This is called the “Free Estate” and distribution of the Free Estate is set out in a specified order within the 1964 Act and is dependent on the family members who survive the deceased.
Dealing with an intestate estate can be very technical. If you need any assistance with an intestate estate or if you require advice regarding the preparation of a Will of your own, please get in touch with the Blackadders’ Private Client Teams working in Aberdeen, Dundee, Edinburgh, Glasgow, Perth and across Scotland.
Fiona Knox, Solicitor
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