Ask the experts

We answer your financial queries

Q: I have no family – do I need a will?

A: In a word, yes. Without a will, the law of intestacy applies and governs who your estate will pass to. A hierarchy of beneficiaries is set out and your estate will pass to a class of your relatives, however remote. If no heirs can be located, your estate will ultimately pass to the Crown.

A will allows you to leave legacies and also to decide how the remainder of your estate should be divided. For example, you may wish to leave prized possessions to close friends or cash sums to charities. Leaving part of your estate to charity can also reduce your estate’s Inheritance Tax (IHT) liability. IHT is payable at 40% on any value above your available Nil Rate Band (currently £325,000), but bequests to charity are free from IHT. You can also reduce the rate of IHT payable to 36% by leaving 10% of your estate to charity. You can include trust provisions to prevent young beneficiaries receiving large inheritances at the age of 16.

In addition to naming beneficiaries, a will allows you to choose your executors, whereas intestacy law determines who will be appointed to administer your estate. You can also specify funeral wishes to guide your executors, which can be important where there are no close relatives to brief.

Finally, intestate estates usually incur more administration expenses, including costs to trace heirs, additional court fees and a premium to obtain a special insurance policy. Extra layers of procedure can delay the winding up of your estate.

With the risk of your estate passing to unknown relatives and the added expense and delays caused by dying intestate, it is highly recommended that you seek legal advice to put in place an appropriate will.