Inheritance when separated parents haven’t divorced

[Molocosh]

My parents have been separated for nearly 20 years and haven’t seen each other since. They haven’t formally divorced because of the expense and hassle, and because they’re religious and don’t believe in divorce.

Recently they’ve begun thinking about death due to Covid19 and their increasing age. They’ve both recently made wills leaving all their assets to their shared children. Is this sufficient or is there something we haven’t considered? We’ve tried to suggest they should divorce but they won’t hear of it.

Hopeful bump.

I’m no expert and I have a vague feeling there are tax implications but if their wills are properly constructed and they are in England it should be fine.

If they have made wills after date of marriage, then they should be fine.

If they have left their assets to children, will the surviving partner be able to remain in the shared house if there is one?

Have they done the leave £1 to each other to show they haven't been forgotten?

Did they do wills via a solicitor?

(I am not a lawyer)

By not leaving their estate to each other, they are not making full use of their IHT allowance. Possibly that doesn’t matter. Otherwise they can do what they like but obviously haven’t made provisions for each other. They don’t have to.

They’re both below the IHT threshold. DF owns a house that he purchased after they separated. DM rents. They are both keen that their assets go to DC not to each other. Especially DF is worried that if he dies first the council will try to seize his house to pay for DM’s care.

So much easier if they divorced! I’ve no idea what a Local authority would do. But if it’s his house and it’s been left to DC it should not be an asset available to your DM. However what assets does she still have in the marriage? Anything? Or does your father have everything?

They are being very foolish and should divorce. It’s hardly any hassle after this length of separation.

When they were married they rented and worked to pay the bills. They had no assets in the marriage apart from savings that they split 50/50. DF continued to work and bought a house about ten years after they separated. DM quit work to care for her mum who recently passed away, she rents and lives on her state pension. They have separate savings. Both have willed their entire estate to DC but are worried that they won’t receive it.

Agree that in an ideal world they should divorce. If they really won't do that then you can have a statement added to a will to make it clear you have considered the other party.

My situation is slightly different but I do have some experience of this. I am divorced (many years ago) and own my home outright. I have two adult children. I have a partner who lives with me and has done for a long time (more than 10 years) - he doesn't have children. He has his own property which he rents out. We have always been clear with each other that when I die my home/assets are to go to my children and when he dies his house/assets will go to his brother.

When I drew up my will my solicitor advised that as well as stating in the actual will that I was leaving everything to my children it was worth having a separate document drawn up and attached to the will that acknowledged that my partner and I had discussed the situation and to make it clear that it was an active decision that none of my estate should pass to him. He said this covered the scenario of it being alleged that I had not 'thought it through properly' when I made the will.

I guess this is maybe the same as the leaving £1 to them to acknowledge that you have considered them but still left the bulk to someone else.

Age uk has good advice on care home fees. The home owner would have to pay. For himself as far as I can see. If it’s not a joint asset then it could be used for funding but only for its owner. But do check this.

Difficult one as they don't have loads of assets but they really need professional advice. I don't think your fathers home is at risk re care homes fees as it is in his name and bought after separation so clear cut.

But it could be a mess if the party with no house wanted to get awkward as financially they are not separate. Divorce would have been better but they are still entitled to leave their assets to who they want, but the spouse is at liberty to ask a court to invalidate the will if adequate provision was not made for them, but it doesn't sound like this is the case...of course unless one remarries!

One benefit of them not being divorced is access to spousal pensions. My parents were very similar to yours, 20 years separated, quite hostile to each other but didn't want to divorce. When my dad died he was in receipt of a pension from his former employer. My mum was entitled to half that amount as a spousal pension until she died.

The house could be sold for care home fees for him though. It’s an asset and is, presumably, worth more than the minimum capital sum.

I would take advice on whether it’s considered to be a marital asset and it’s in his name to avoid paying for care home fees for his wife. I would definitely take expert legal advice on that.

Yes. They are separated but not divorced so how the marital capital is used, and for whose benefit, needs to be established. They are not separate entities. A financial settlement after divorce might change who has what capital too.