Knowing Your Rights: What is “Reasonable Financial Provision” in an Inheritance?

If you have been left out of a Will, you may be eligible to claim for reasonable financial provision from the deceased’s estate. We look at who can claim and how much they might receive. It can be distressing to find that you have not been provided for from the estate of a loved one. The Inheritance (Provision for Family and Dependants) Act 1975 (the Inheritance Act) allows certain individuals to make a claim against the estate.  

Who can make an Inheritance Act claim?

  The Inheritance Act allows the following individuals to make a claim:

  • A spouse or civil partner
  • A former spouse or former civil partner, provided that they have not remarried or entered into a new civil partnership
  • The cohabiting partner, provided they were living with the deceased for at least two years prior to the date of death
  • A child of the deceased
  • Anyone the deceased treated as their child
  • Anyone supported financially by the deceased at the date of their death
How much can you claim under the Inheritance Act?

A spouse or civil partner can claim for ‘such financial provision as it would be reasonable in all the circumstances of the case for a husband or wife to receive.  This is not dependent upon that provision being required for his or her maintenance.  In practice, this could be a similar sum to what they would have received if they had divorced or dissolved the civil partnership.  All other individuals are entitled to make a claim for ‘reasonable financial provision’.  

What is reasonable financial provision?

  If the court is asked to decide what reasonable financial provision is, it considers the following points:

  • The financial resources you have available to you and those available to you in the foreseeable future
  • Your financial needs both now and in the foreseeable future
  • The financial resources and needs of other beneficiaries and any other potential claimants
  • The deceased’s obligations and responsibilities
  • The size of the estate
  • Any physical or mental disability of any beneficiary or potential claimant
  • Anything else which the court considers relevant

In the case of Ilott v Mitson [2017], the Supreme Court considered a particularly interesting case. An estranged daughter challenged her mother’s will, which left the entire estate to charities. The daughter, Mrs. Ilott, had five children, relying on state benefits and living in Housing Association accommodation.  The court first clarified the concept of reasonable financial provision. They emphasized that it shouldn’t encompass everything a claimant desires, but it shouldn’t be limited to mere subsistence either.

The court explored the options for awarding financial provision. While a lump sum can be appropriate, the justices cautioned that capital that appreciates in value goes beyond just meeting basic needs.  In this case it might exceed reasonable provision. In such cases where housing is a primary need for the claimant, a life interest in a property might be a more suitable option.  Considering the estranged relationship between mother and daughter, the court acknowledged the long period of estrangement to be a significant factor in the case. Additionally, they noted the deceased’s clear wishes for her daughter to inherit nothing and for the executors to contest any claim.

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