The Queen’s jubilee – thinking about succession planning and the future
On 6th February 2022, the Queen became the first British monarch to celebrate a Platinum Jubilee, marking a 70-year reign. Whilst the Royal Family and people throughout the country will celebrate with different events throughout the year, the expectation is that this jubilee is likely to be the last major royal occasion before the death of the Queen and the succession of King Charles III. It is safe to say that this year, the Queen will not only spend a lot of time reflecting on her last 70 years but also considering what the future will hold for her family.
Fortunately for the Queen, she does not have to worry about the rules of succession to the Throne as they are regulated not only through descent but also by Parliamentary statute. The rules state that a monarch’s eldest child automatically inherits the Crown upon the death of the previous Monarch, leaving Prince Charles the first in line to succeed his mother, Queen Elizabeth.
Succession planning, however, is not only useful for the Royal Family – it is in the interest of every person to consider their own succession plan and who will inherit their assets in the event of their death. Similar to the rules governing succession to the Throne, there are rules set out in Statute in the UK that govern succession for the ordinary person. This blog will consider the rules in both Scotland and England & Wales, and will also provide guidance on key aspects to consider when creating your own succession plan.
In Scotland, the law sets out the rules both:
- Where a person has died without leaving a Will (known as dying intestate)
- Where a person has died leaving a Will (known as dying testate)
If a person dies without leaving a Will, everything that person owns will be distributed according to the rules set out in the Succession (Scotland) Act 1964. The Act provides how the estate of the deceased should be divided, and although it has been updated over the past 58 years, there is a strong feeling that the Act does not take into account the dynamics of many modern-day families. By relying on the rules of intestacy, your estate may not be distributed in the way you intend or the way you expect. In order to avoid this, and to provide your family with peace of mind after your death, it is important to consider your own succession plan.
Where you have considered your own succession plan and a Will has been made, the rules are different. As long as the Will is legally valid, then you will have control of who inherits your estate subject to certain rules. For example, your intention may be to leave nothing to a specific family member i.e. a spouse, civil partner or child. However, in Scotland under the law of succession, it is not possible to disinherit relatives, including where any children concerned are now adults. This is because they will be able to make a legal rights claim against your moveable estate.
Not unlike the law of succession in Scotland, in England and Wales if you die without a valid Will there are strict inheritance laws that govern how your estate will be divided. These can be found under the Administration of Estates Act 1925 and Inheritance and Trustees’ Power Act 2014. The rules make no provision for unmarried and unregistered partners or step-children meaning that they do not allow for modern family relationships. Despite this, there are means by which individuals may be able to make a claim against your intestate estate; if they are a beneficiary and are not happy about their inheritance (or lack of) or by claiming ‘reasonable financial provision if they were a dependant not benefitting under the succession laws. The intestacy rules are complex and differ varying on the date of death.
If you are domiciled in England & Wales and you have made a Will, then when you die, your executor will follow the provisions in your will. Unlike in Scotland, nobody can make a legal rights claim on your Estate unless, as above, they can prove that they were ‘dependant’ upon your estate.
Considering your own succession plan
Overall, whether you live in Scotland, England, Wales or Northern Ireland, there are statutory rules governing succession, both for the Royal Family and any ordinary person. Despite this, by considering your own succession plan you can ensure that the right people inherit from your estate at the right time.
Wills are a great way to start with your succession plan. Even Queen Elizabeth the Queen Mother made a Will and despite leaving her entire estate to the Queen, in her Will she asked the Queen to make certain bequests to members of her staff. You may also wish to leave specific assets to certain beneficiaries, leave property to a particular individual or leave monetary legacies to particular persons. All of these can be done by creating a Will but there is also the chance that an individual, provided they have the standing to do so, will make a claim against your estate if they have not been included in your Will.
Whilst having a Will provides you with an element of control over who inherits your assets after death, as part of your own succession plan you may also consider creating a Trust as a means of ensuring assets pass from one generation to the next.
A Trust is a separate legal document from a Will and is created by a Settlor (the original owner of an asset) who hands over control of assets to trustees to manage and oversee the assets on behalf of the beneficiaries. Trustees have strict fiduciary duties as the legal owners of the assets to safeguard them on behalf of the beneficiaries of the Trust.
The use of Trusts can help to ensure that assets remain in the family and are protected against not only legal rights claims but also future claims from creditors, spouses, or even a beneficiary’s misguided actions. Moreover, Trustees will ensure beneficiaries inherit the assets at the right time and as you intended them to do so.
Overall, careful succession planning can ensure assets pass to or become held for the benefit of the appropriate successor. Having a succession plan in place will not only give you peace of mind but will also ensure your family have stability and certainty regarding your estate when you pass away. Moreover, it is important to have a succession plan specifically tailored to you in order to reduce tax implications on your estate and limit the effects of bad lifestyle choices by family members.
Contact us regarding your own succession plan
At Jones Whyte, we have the experience and expertise to help you create your own succession plan. Whether you wish to create or revise a Will, set up a Trust or simply have a discussion regarding your own estate when you pass away, please contact us at 0141 375 1222 or fill in our online contact form.
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