How to Reduce the Risk of an Inheritance Act Claim Against Your Estate

Many people expect their will to determine exactly what will happen to their possessions after their death. While this is often the case, a will is not always the end of the story. Certain people may be able to apply to the court for financial provision from your estate under the Inheritance (Provision for Family and Dependants) Act 1975.

It’s impossible to guarantee that no claim will be made against your estate. However, careful planning can help you identify potential applicants, understand their needs, explain your intentions and put your executors in a stronger position if a dispute arises. This is particularly important if you intend to leave little or nothing to your spouse, civil partner or child.

Who can make a claim?

To be eligible to apply, a person must fall within one of the categories set out in the 1975 Act. These include your spouse or civil partner, a former spouse or civil partner who has not remarried or entered a new civil partnership, your child, someone you treated as a child of the family, a person whose maintenance you contributed to in circumstances covered by the Act, and, in some cases, a cohabitant. A qualifying cohabitant will generally need to have lived in the same household as you, as if they were your spouse or civil partner, throughout the two years immediately before your death.

Being eligible to apply does not mean that a claim will automatically succeed. The applicant must also show that your will, or the intestacy rules if there is no valid will, failed to make reasonable financial provision for them.

For a surviving spouse or civil partner, reasonable financial provision is not limited to maintenance. As a cross-check, the court may consider the financial outcome of a hypothetical divorce when deciding what is reasonable, although death and divorce are not treated in exactly the same way. For other applicants, reasonable financial provision is limited to what is reasonable for their maintenance.

A claim will not succeed simply because someone is eligible to apply. The court will look at the circumstances as a whole, including the applicant’s needs and resources, the position of your beneficiaries, the size and nature of your estate, and any obligations or responsibilities you had towards those involved. Where relevant, the court may also consider the applicant’s disability, conduct and contributions to the family’s welfare.

Practical steps to plan for potential claims

1. Identify potential applicants and assess their needs

Before drafting your will, it can be helpful to make a list of anyone who you think may qualify to bring a claim. For each person, think about your relationship with them, any support you currently provide and what their financial position may be after your death.

This is especially important if you plan to exclude an adult child from your will. Estrangement does not, by itself, prevent them from bringing a claim. The court will consider how the estrangement arose, together with all the other relevant factors.

2. Consider whether a modest provision could meet their needs

If you do not want someone to receive a substantial share of your estate, you may wish to consider whether a smaller, carefully structured provision could meet their needs while still respecting your wider intentions.

For example, you might leave someone a limited sum of money or give them a right to occupy a property for a defined period, rather than giving them a percentage share of the estate. Any such provision should be considered alongside the needs of your other beneficiaries and the practical responsibilities it may place on your executors.

A fixed cash gift may also become unsuitable if the value of your estate changes. You may have sufficient funds now, but care costs or other changes in your financial circumstances could significantly reduce what is available for your beneficiaries. It is therefore sensible to review the arrangement regularly.

3. Use a letter of wishes carefully

A letter of wishes can help explain the reasons behind the decisions in your will. For example, you can explain why you have made different provisions for your children or why you have excluded someone entirely. Although it is not legally binding on your executors or the court, it can provide useful context and help others understand your intentions.

If you use a letter of wishes, try to keep it factual, measured and consistent with your will. Avoid angry or exaggerated comments about someone from whom you are estranged. If a claim is brought, the letter may become relevant to the dispute, so it is worth preparing it with the same care as your will.

You should also review your letter of wishes when your circumstances change. An outdated explanation may create confusion rather than clarify your intentions.

4. Consider a life interest trust for your spouse or civil partner

If you want to provide security for your spouse or civil partner during their lifetime while preserving capital for your children or other beneficiaries, a life interest trust may be worth considering. Depending on its terms, the trust can provide someone income from the trust assets or a right to occupy a home, with the capital passing to the other beneficiaries at a later stage.

A life interest trust can be a helpful way to balance the needs of different family members, particularly if you have remarried and have children from an earlier relationship who you would like to ensure inherit some of your estate. Whether this type of trust is suitable will depend on the assets in your estate, your family’s circumstances and any potential tax consequences. It is also worth remembering that, if an application is made, the court can still consider the trust alongside the wider circumstances of your estate.

5. Seek advice before considering a forfeiture clause

In some circumstances, a will may state that a beneficiary will lose their gift if they challenge the will or bring a claim against the estate. This type of provision is sometimes called a no-contest or forfeiture clause.

A forfeiture clause cannot outright prevent an eligible person from applying under the 1975 Act, nor can it prevent the court from considering their claim. It may, however, discourage a beneficiary from bringing a claim because doing so could put their existing inheritance at risk.

Whether a no-contest clause is effective will depend on its precise wording and the surrounding circumstances. It will usually need to explain clearly what conduct will trigger forfeiture and what will happen to the gift if it is lost, often by directing it to another beneficiary.

How you can strengthen your estate plan

Although you cannot prevent an eligible person from bringing a claim, thoughtful planning can help you balance competing needs, reduce uncertainty and put your executors in a stronger position if a dispute arises.

It is a good idea to review your will, any letter of wishes and your wider estate planning regularly so that they continue to reflect your circumstances and intentions.

If you are looking at drafting a will and are concerned about a potential Inheritance Act claim, Farleys’ specialist Private Client team can talk you through your options and help you plan your will and wider estate arrangements with confidence. To find out more, please call us on 0330 828 3955, get in touch by email, or use the online chat below.