When this happens, the law (The Succession Act 2004 NSW) will determine who receives money (or assets) from your estate.
For further information relating to the rules on intestacy, visit our family provisions webpage.
If your spouse has died without making a valid will you may not always be guaranteed the whole of your spouse’s estate.
Firstly, the definition of a ‘spouse’ can be any of the following:
- A person you are married to (this will also include a person who you are separated from, but not yet divorced from);
- A person you have been living with for the past two years (ie in a de facto relationship with); or
- A person who you have a child with (regardless of whether you have ever lived with them or been married to them).
This definition means that a person may die with more than one ‘spouse’.
For example if you are in a relationship with someone and you live together but you also have an ex-wife or husband who you haven’t yet legally divorced then you have two spouses.
The definition of children is also important. For example an adopted child is considered a biological child for the purpose of distribution of the estate.
The following examples relate to when your spouse has died without leaving a valid will. Depending on your family structure, the distribution of the estate will vary.
1. If you have one spouse and all your children are from the relationship of yourself and your spouse.
The whole of your spouses’ estate will pass to you.
This is because generally, most people will leave their estate to their spouse, on the assumption that the children will receive the benefit of the whole estate when their surviving spouse passes away.
2. If you and/or your spouse have children from previous relationships
If you belong to a “blended” family and you have step-children (children of the deceased only), then you will not receive the whole estate.
Instead, you will receive:
- All the personal effects of the deceased;
- $350,000.00 (as a statutory legacy); and
- One half of the remainder of the estate.
The children of the deceased will divide the remaining one half of the estate equally between them.
In this case, you might wish to take particular assets from the estate, such as real estate that is not in your name. If so, you can choose to take that property rather than receive the $350,000.000 statutory legacy and half the remaining estate.
You can only do this if the sum of the assets equal the amount due to you as set out above.
If you wish to acquire an asset has a greater value than your allotted share of the estate, you must pay the balance with your own funds.
For instance, if the marital home is not in your name (or you do not own the property as joint tenants with your spouse), you may lose the house unless you pay the balance of its value.
3. If you and your deceased partner were in a de facto relationship for less than two years and your deceased partner has a spouse whom they have not yet divorced, and there are no children,
The married spouse will take the whole estate and you will not be entitled to any of the estate.
4. If you and your deceased partner were in a de facto relationship for more than two years and your deceased partner has a spouse whom they have not yet divorced, and there are no children,
You and the ‘married’ spouse will share the estate. Usually the shares can be determined by an agreement between you both or if you are unable to agree then the Court will make an Order. generally, the Court will order a 50/50 split, unless there are exceptional circumstances (such as if you have been in a de facto relationship for at least ten years and the married spouse has had no contact with the deceased during that time).
5. If you and your deceased partner were in a de facto relationship for more than two years and your deceased partner has a spouse whom they have not yet divorced, and there are children,
You and the spouse will have to split the personal effects, statutory legacy and half of the remaining estate between you. The children will get the remaining half of the estate.
As you can imagine, this splitting of assets can become very confusing amongst beneficiaries. A person may own many different types of assets, such as property, shares, money, and superannuation. To split this equally, the easiest way might be to sell everything. However this could have stamp duty and other tax implications for some beneficiaries as well as causing more stress and worry to you all.
To avoid this, it is very important, especially if you are a member of a split-family to ensure you make a valid will to avoid family disputes when it comes time to distribute your estate.
Contact our office today on 9653 9466 to arrange to meet with one of our Solicitors for help with drafting your will.
Spouse’s statutory legacy
As discussed above a spouses’ statutory legacy is currently $350,000.00. This figure is adjusted according to the Consumer Price Index (CPI), to mirror current interest rates at the time of death.
The figure is calculated as follows:
CPI adjusted legacy = $350,000.00 x (CPI index for last published quarter before death / CPI for the December 2005 quarter)
If the statutory legacy is not paid in full within one year of your intestate partner’s death, then interest is also payable to you at the relevant rate (this is 2% above the rate last outline by the Reserve Bank of Australia before the 1 January of the year that the interest begins to accrue) on the outstanding amount. The interest is calculated from the first anniversary of death to the date of full payment.
If you have a relative who has died intestate and you would like clarification on where you stand, contact us today on (02) 9653 9466.