It is the staple of many a Hollywood film: The family gathered expectantly around the fire after a funeral to hear some dusty old lawyer read from an equally dusty last will and testament , only to be shocked to learn that the Late Earl has left everything to the local stamp collecting society leaving his entire family penniless !!
Great drama based upon the Anglo-American laws of succession. Alas, in Scotland - courtesy of the lasting effects of the Roman Empire – families are spared such a dramatic outcome, as the family is at the heart of Scottish succession.
When there is no Will
In Scotland, when an individual dies without a will - so called “intestacy” – the default position is that the individual’s family will inherit through “Prior Rights” and “Legal Rights”. As the name suggests “Prior Rights” take precedence over Legal Rights, and apply to that individual’s spouse or civil partner. Prior Rights mean the surviving spouse or civil partner receives:
- the family home up to a certain value (currently £473,000)
- the furniture in that home up to a certain value (currently £29,000), and
- a cash sum of money, again, up to a certain value (currently £50,000 if there are children, £89,000 of there are no children).
If the value of the estate is within the current limits for Prior Rights, then the entire estate will be exhausted by these and there will be nothing left for Legal Rights.
After the Prior Rights have been satisfied, if there is any moveable estate left, the following Legal Rights will apply:
- the spouse or civil partner is entitled to receive one third of the remaining estate,
- Any child or children are entitled to receive one third of the remaining estate divided equally amongst them. Children in this context means biological or adopted children: Scottish law does not make provision for step-children.
Legal rights can be claimed for up to 20 years from date of death. This means that as long as a person’s legal rights have not been formally discharged in writing, a person can make a claim against the estate for up to 20 years.
When there is a Will
When you’re making your Will, you can leave your heritable or moveable estate to whoever you like such as the local stamp collecting society.
However, Legal rights come to effect no matter if you have a Will or not. However, if a person has an entitlement under your Will as well as their Legal rights entitlement, they can only choose to claim one or the other and cannot claim both. Legal rights include the worldwide net moveable estate only of the deceased and includes cash, shareholdings, personal effects and furniture, cars etc. Legal rights do not include heritable estate such as land and buildings. Legal Rights are seen as a debt against the estate and therefore must be paid before any legacy or payment is made from the Will to a beneficiary.
So, if you live in Scotland and you wish to leave all your money to the local stamp collecting society, anyone with legal rights would need to renounce their rights. Thus, you need your family to respect your wishes.
Disinheritance?
For whatever reason, individuals can wish to disinherit certain family members. However, as we have seen this is very difficult in Scotland.
As it stands at the moment, heritable property is not included in the legal rights calculation. Legal rights claims can be mitigated by converting moveable property to heritable property however this can be very impractical and not recommended. Similarly the passage of moveable property, can be minimised by the formation of a trust in certain cases.
Thus in Scotland, while you can if you so desire minimise how much your family inherits from you, you cannot exclude your family entirely unless your family accepts this exclusion.
After all, in the wise words of my Mother, Blood is thicker than water.
How we can help
Here at Miller Samuel Hill Brown, we understand that you have unique needs and desires when planning your estate. That is why we take a personalised approach to offer you the best possible advice and support. Our Private Client Team is dedicated to providing you with compassionate and tailored solutions. We aim to make a real difference while ensuring the necessary protection and security for you, your partner, and your family.
We invite you to reach out to us today at 0141 221 1919 to discuss how we can help you plan according to your specific needs and desires. Our team is always here to help.
