What Happens to the Family Home if I Die Without Making a Will?
5 minute read
When it comes to your home, leaving things undecided can have lasting consequences.
For most families, the home is the most valuable asset they own. It is also, in many cases, the most emotionally significant one. So it is worth understanding clearly what happens to it if you die without leaving a will, because the answer is often not what people expect.
When someone dies without a valid will in England and Wales, their estate, including any property they owned, is distributed according to the rules of intestacy. These are fixed legal rules that follow a strict hierarchy of relatives. They take no account of personal relationships, individual circumstances, or what you might have wanted. And where the family home is concerned, the results can cause real and lasting difficulties for the people left behind.
In this post we look at the main scenarios where the intestacy rules create problems for families and property, and explain what a properly drafted will can do to prevent them.
Table of Contents
How the Intestacy Rules Work in Brief
Under the intestacy rules, your estate passes to your closest relatives in a defined order. A surviving spouse or civil partner is at the top of that hierarchy, but their entitlement depends on the value of the estate and whether you have children. After spouses and civil partners, the rules work through a sequence of blood relatives: children, then parents, then siblings, and so on.
What the intestacy rules do not do is recognise cohabiting partners, close friends, stepchildren who have not been formally adopted, or any of the other relationships that matter deeply to many people but carry no automatic legal weight.
The rules also make no allowance for the practical reality that a home is not like a bank account. It cannot easily be divided between multiple people, and when it becomes co-owned by relatives with different needs and different views about what should happen to it, the results can be difficult to manage.
The Seven Key Problems, and What Can Be Done About Them
Unmarried Partners Have No Automatic Right to the Home
Imagine you and your partner have lived together for fifteen years. You own the home together, but you are not married.
This is perhaps the most significant and most commonly misunderstood consequence of dying without a will. If you are not married to or in a civil partnership with your partner, they have no automatic right to inherit anything from your estate under the intestacy rules. It does not matter how long you have lived together, how intertwined your finances are, or how clear your intentions may have been. There is no such thing as a common law spouse in English and Welsh law, and the intestacy rules do not recognise cohabiting partners at all.
If you owned the home in your sole name, it would pass to your blood relatives under the intestacy hierarchy. Your partner could find themselves sharing ownership of the home with your parents, siblings, or other relatives, or in the worst case, facing pressure to leave a property they may have lived in for many years.
The situation is only marginally less precarious if you owned the home jointly. Joint ownership in England and Wales takes one of two forms. If you owned the property as joint tenants, your share passes automatically to the surviving co-owner on your death, regardless of any will or intestacy rules. But if you owned it as tenants in common, which is common where couples have contributed unequal deposits or have deliberately ring-fenced their individual shares, your share does not pass automatically to the survivor. Instead, it forms part of your estate and passes under the intestacy rules.
This can result in your partner suddenly finding themselves co-owning the home with your relatives, some of whom may have no interest in allowing your partner to remain there and every interest in realising the value of their inherited share.
A Surviving Spouse May Not Inherit the Whole Home
Even if you are married or in a civil partnership, the intestacy rules do not automatically give your spouse everything. If your estate exceeds a certain value (currently £322,000, though this figure is subject to change) and you have children, your spouse will inherit the first £322,000 of the estate plus half of the remainder. The other half of the remainder passes to your children.
Where the estate is largely made up of the family home, this division can create real practical difficulties. Your spouse may find themselves co-owning the property with your children. If the children are from a previous relationship, or if there are tensions within the family, this co-ownership arrangement can become a source of significant conflict.
Even where family dynamics are straightforward, the legal and administrative complications of co-owning a property with children can make it difficult for a surviving spouse to remain in the home, remortgage it, or deal with it as their circumstances change.
Pressure to Sell the Home
When a property is inherited by multiple people under the intestacy rules, they may not agree on what should happen next. One beneficiary may want to sell their share and access the proceeds. Another may want to remain living in the property. A third may simply want the matter resolved as quickly as possible.
Where beneficiaries cannot agree, the law provides a route to compel a sale by applying to court under the Trusts of Land and Appointment of Trustees Act 1996. The court has a broad discretion, but a sale is a very real possibility, particularly where a beneficiary can demonstrate a financial need for their share.
The prospect of being forced to leave the family home through a court-ordered sale is distressing in any circumstances. It is made considerably more likely by the absence of a will that clearly sets out what should happen to the property and who has the right to remain in it.
The family home is too important to leave to chance. A professionally drafted will lets you decide exactly what happens to your property and who is protected. Get in touch to find out how we can help.
Children Inheriting a Share at Age 18
Under the intestacy rules, children become entitled to their share of the inheritance at age 18. For many families, this is earlier than a parent would choose. An eighteen-year-old who inherits a share of the family home is legally entitled to deal with that share as they see fit, which may create pressure on a surviving parent who is still living in the property.
There is also a broader point about readiness. Inheriting a share of a property is not a straightforward thing to manage, even for an adult. It involves legal responsibilities, potential tax implications, and decisions about what to do with an asset shared with others. Many parents would prefer their children to inherit later, or to have the inheritance managed for them in a structured way until they are better placed to deal with it.
A will can specify the age at which children inherit, and can include a trust to hold and manage their share in the meantime. This gives the surviving parent stability and gives the children the benefit of a managed inheritance rather than an abrupt one.
Conflict in Blended Families
The intestacy rules are not designed with blended families in mind, and the results can be particularly difficult where a surviving parent has children from a previous relationship. If your estate passes partly or wholly to your children under the intestacy rules, and those children are not the children of your surviving partner, the potential for conflict over the family home is significant.
Your children may have a legal entitlement to a share of the property. Your partner may have a moral and practical claim to remain living there. Those two positions may be difficult or impossible to reconcile without clear written guidance about what you actually want.
Stepchildren who have not been formally adopted also have no entitlement under the intestacy rules at all. If you wish to make provision for them, you can only do so through a will. Without one, they will receive nothing, regardless of how close your relationship with them is..
Claims Against the Estate
The Inheritance (Provision for Family and Dependants) Act 1975 allows certain people to make a claim against an estate if they feel they have not been adequately provided for. Eligible claimants include spouses, civil partners, cohabiting partners who lived with the deceased for at least two years before the death, children, and others who were financially dependent on the deceased.
If your estate is distributed under the intestacy rules and leaves someone who depended on you without adequate provision, that person may have grounds to bring a claim. Such a claim can create significant uncertainty about what happens to the property, since the court has the power to make orders affecting how the estate is distributed, including orders relating to specific assets.
A well-drafted will does not eliminate the possibility of a claim under the 1975 Act, but it significantly reduces the risk. By making clear and considered provision for the people who depend on you, and by setting out your reasoning in a letter of wishes, you reduce both the likelihood of a claim being brought and the prospects of it succeeding.
Inheritance Tax and the Risk of a Forced Sale
Without careful planning, an estate may not make the best use of the inheritance tax allowances and reliefs available to it. The Nil Rate Band, the Residence Nil Rate Band, and the ability to transfer unused allowances between spouses and civil partners are all valuable, but they do not apply automatically in every situation. The way assets pass and the order in which they pass can affect whether these allowances are used efficiently.
Where the estate is largely made up of property, an unexpected or avoidable inheritance tax liability can put pressure to sell the home in order to pay for that liability. This is a distressing outcome that careful will drafting, designed to make the best use of available allowances, can often prevent or at least significantly reduce.
It is worth noting that the Residence Nil Rate Band, which can currently shelter up to £175,000 of a property’s value when it passes to direct descendants, is not available in every situation. It requires the property to be inherited in a particular way and is subject to tapering for larger estates. These are all matters that a professionally drafted Will can be structured to address.
What a Will Can do to protect the family home
As the scenarios above illustrate, dying without a will can leave the family home in a genuinely precarious position. The intestacy rules were not designed to deal sensitively with the complexity of modern family life, and they often produce outcomes that cause practical hardship and family conflict.
A will addresses all of the issues discussed in this post. It allows you to specify who inherits the property, on what terms, and at what point. It can include a trust to protect a surviving partner’s right to remain in the home while also making provision for children. It can ensure that unmarried partners are not left without legal protection. It can prevent children from inheriting at an age or in circumstances that are not in their interests. And it can be structured to make the best possible use of available inheritance tax allowances, reducing the risk that a tax liability will force a sale.
None of this requires complex arrangements. For most families, the starting point is simply a clear and professionally drafted will that reflects what you actually want.
None of this requires complex arrangements. For most families, the starting point is simply a clear and professionally drafted will that reflects what you actually want.
A Note on reviewing your arrangements
If you already have a will but it has not been reviewed recently, it is worth considering whether it still reflects your circumstances. Changes in your family situation, changes in the law, and changes in the value or ownership structure of your property can all affect whether your existing will achieves what you intend.
As a general rule, reviewing your will every three to five years is sensible, and you should always review it after a significant life event such as a marriage, a separation, the birth of a child, or a change in how you own your property.
Making a will is the most reliable way to ensure that your property goes to the right people, on the right terms, without leaving your family to deal with unnecessary uncertainty. Our will-drafting service is designed to be straightforward and thorough. Get in touch to find out how we can help.
Frequently Asked Questions
What happens to the family home if you die without a Will in England and Wales?
If you die without a Will, your property is distributed under the rules of intestacy. These fixed legal rules follow a strict hierarchy of relatives and take no account of your personal wishes, which can create serious difficulties for the people you leave behind.
Does an unmarried partner have a right to the family home if there is no Will?
No. Cohabiting partners have no automatic right to inherit under the intestacy rules, regardless of how long they have lived together. If the home was in the deceased’s sole name, it passes to blood relatives. Even if jointly owned, the outcome depends on whether it was held as joint tenants or tenants in common.
Does a surviving spouse automatically inherit the family home if there is no Will?
Not necessarily. If the estate exceeds £322,000 and there are children, the spouse inherits the first £322,000 plus half of the remainder. The other half passes to the children, which can result in co-ownership of the family home and create significant practical difficulties.
Can beneficiaries be forced to sell the family home under intestacy?
Yes. Where multiple people inherit a property and cannot agree on what to do with it, any of them can apply to court under the Trusts of Land and Appointment of Trustees Act 1996 to force a sale. A Will setting out clear instructions significantly reduces this risk.
At what age do children inherit under the intestacy rules?
Children become entitled to their inherited share at age 18. A Will can specify a later age and include a trust to manage the inheritance in the meantime, providing greater stability for a surviving parent still living in the property.
Do stepchildren inherit the family home if there is no Will?
No. Stepchildren who have not been formally adopted are not recognised under the intestacy rules and receive nothing. They can only be provided for through a Will.
Can dying without a Will lead to an inheritance tax problem on the family home?
Yes. Without careful Will planning, available allowances such as the Residence Nil Rate Band (currently up to £175,000) may not be used efficiently. This can result in an avoidable tax liability that creates pressure to sell the family home to meet it.
How often should I review my Will to protect the family home?
As a general rule, reviewing your Will every three to five years is sensible. You should also review it after any significant life event such as marriage, separation, the birth of a child, or a change in how you own your property.
Disclaimer
This article is intended as general information only and does not constitute legal advice. The information refers to the law of England and Wales. Tax thresholds and legal rules are correct at the time of writing but are subject to change. We recommend that you seek professional advice regarding your own circumstances.
Bio
This article was written by Stephen Rhodes. Stephen was called to the Bar of England and Wales in 1999 and brings over 25 years of in-house experience working with solicitor firms across the Manchester area, with a specialism in Wills and Probate. He now focuses exclusively on will drafting, helping his clients ensure their loved ones are taken care of exactly as they would wish.