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Trusts and Succession (Scotland) Act 2024 Briefing | Part two

Trusts and Succession (Scotland) Act 2024 Briefing | Part two

As we noted in our previous blog on the new highly anticipated Trusts and Succession (Scotland) Act 2024 was unanimously passed by the Scottish Parliament, which has now gained Royal Ascent as of 30 January 2024. The new law predominantly is concerned with modernising practical aspects of the running of Trusts, but also makes important changes to the succession law. We are concentrating on this latter aspect in this blog, but have a look at Part 1 for a summary of the changes to Trust law. 

Succession

The Act will change the law on intestate succession, affecting the estates of those who die without a Will and those left behind.  Notably, the Bill closes a loophole in the law which has allowed convicted murderers from acting as an executor on their victim’s estate. 

At the moment, if a person dies without a Will, the decision of who benefits from their estate is governed by law from 60 years ago. If there is a surviving spouse or civil partner, they automatically inherit the dwelling house (up to a certain value) in which they and the person who died lived. They also receive the contents of the house (again up to a certain value) and a cash sum of up to £89,000 depending on whether the person who died had surviving children. These entitlements are collectively called “Prior Rights”.

Following this if the estate still has assets left, the rest is distributed according to a set hierarchy depending on who survived. Any surviving children and grandchildren are the first to inherit, but if there are none, then the balance of the estate goes to the deceased’s parents & siblings. It’s only if there are no kids and the person who died also had no surviving parents, brothers or sisters that the spouse or civil partner gets anything beyond their Prior Rights.

This means in many cases that this results in a large portion of the estate passing to parents or siblings rather than the surviving spouse. As such, this position has been greatly criticised as being out of line with public opinion or what most people without children would want. 

The Act will change the order of priority so that spouses are next to inherit after children and grandchildren. This change will mean that when someone dies without a Will and had no children, the entire estate would be inherited by a surviving spouse or civil partner- in short, they have been promoted in the eyes of the law and now rank second only to surviving children or grandchildren.  The best way to ensure that your estate goes where you want it (with a few exceptions) is to have a Will but this brings the default position more into line with most people’s expectations.

The Act will also clarify the effect of divorce, dissolution or annulment on “survivorship clauses”. These commonly appear in the title of jointly owned property by spouses and as proposed, divorce will result in such clauses to fail, meaning that property is not automatically inherited by the (now) ex-partner. This is a welcome reform to the surprisingly common survivorship clauses, which many people are unaware of in their title deeds. It also  further clarifies a change to the law which happened a few years ago already. To find out more please see  (link to GD’s article from 2020). 

Changes to the law of intestate succession will come into force three months after getting royal ascent, as such the law is expected to take effect from the end of April. If you like to get a Will in place or review your succession planning, please contact our specialist Private Client team on 03330 430150.

About the authors

Graeme Dickson
Graeme Dickson

Graeme Dickson

Partner

Wills, Trusts & Succession

Robyn Canning
Robyn Canning

Robyn Canning

Trainee Solicitor

Wills, Trusts & Succession

For more information, contact Graeme Dickson or any member of the Wills, Trusts & Succession team on +44 131 322 6166.