Chapter 5: property passing outside of the will or intestacy

Question 1

If an interest in property is owned as a beneficial joint tenant, what will happen to the interest on their death?

Answer 1

• The interest in property owned as a beneficial joint tenant will pass to the survivors
  Applies to matrimonial home and bank accounts

Question 2

Do life assurance policies form part of the deceased’s estate?

Answer 2

No, the policy belongs to the benefiary named in the policy under contract law and is payable directly to the beneficiary

Question 3

Do pension scheme death benefits form part of the deceased’s estate?

Answer 3

• Pension scheme death benefits may be subject to discretionary trusts, but the scheme member is normally permitted to make a non binding nomination of preferred recipient
• In some cases, it will not be possible to nominate and the death in service benefit will form part of the estate for the will or intestacy rules

Question 4

Does property held in a National Savings Bank, friendly societies or in National Savings Certificates form part of the deceased’s estate?

Answer 4

• Such property can be transferred directly to chosen beneficiary by way of statutory nomination in writing
• If a nomination has been made, the insitution must pay the investment to the chosen nominee provided it does not exceed £5,000

Question 5

How will life interests in trust property pass?

Answer 5

• According to the terms of the trust - not through the decendent’s will or intestacy
• Interests may be subject to inheritance tax

Question 6

If the donor has given something away but retained some benefit, what is the consequence?

E.g. Giving away house but continuing to live in it

Answer 6

The asset will not belong to the deceased for succession purposes, but there will be tax consequences