Shock was felt around the world when Liam Payne tragically died in Argentina in October 2024. It has now been established that Liam had not made a Will and his entire estate is being dealt with according to the intestacy rules.
What are the intestacy rules?
If you do not leave a Will when you die, the intestacy rules apply to dictate who benefits from your estate. This depends whether you are married and if you leave children. If you are unmarried with no children, it is distributed according to who has survived you starting with your parents. In smaller families where there are no surviving parents, grandparents, aunts, uncles, siblings, nieces and nephews or cousins, the ultimate beneficiary is the Crown. This is why it is important to consider whom you wish to benefit your estate and prepare your Will in accordance with these wishes.
Liam’s estate
In this case, Liam’s entire estate is left for his son Bear. He is currently under 18 and therefore someone will need to manage this money on his behalf and deal with the administration of Liam’s estate including payment of taxes, managing properties and other assets. The intestacy rules also dictate who is in charge of administration of the estate. Liam’s estate is being managed by his son’s mother, fellow celebrity Cheryl Tweedy, with lawyer Richard Bray appointed as a co-administrator.
Why has Cheryl been appointed?
Under the intestacy rules, where a minor beneficiary inherits an estate, their parent or guardian are automatically appointed to deal with the estate. This is important to remember as it means that your ex-partner, as surviving parent to your children, could suddenly be in charge of dealing with and managing the assets in your estate.
What happens now?
Cheryl and Richard as administrators will now be grappling with managing the properties and other financial assets he left behind, along with ensuring that the necessary inheritance tax (IHT) is paid to HMRC. They will become responsible for insuring the properties, managing any investments and preserving the capital of the estate for Bear’s benefit when he reaches the age of 18. If they fail to do so, they could be liable for a claim from Bear if he feels that they did not act in his best interests as a beneficiary.
Cheryl and Richard will then be legally bound by the intestacy rules to distribute the entire £24m estate to Bear on his 18th birthday, regardless as to whether they feel he is financially mature enough to handle this level of wealth.
If Liam had made a Will
If a valid Will had been made, Liam could have chosen up to 4 executors to help manage the administration of his estate. He could have left legacies to other friends, family and charities, which may have also helped reduce any IHT bill. If he was living with a partner at the time, he may have wanted to allow provision for them to remain living in the property for a set period whilst still ringfencing the capital for his son. He may have wanted to set an older age limit for Bear’s inheritance as a buffer to allow his son to mature financially.
It is such a tragic tale but a sobering reminder to us all that it is never too early to start your estate planning.
If you would like to discuss your own affairs and what arrangements we can assist you with, please do contact Hannah Wallbridge or visit our Wills, Probate and Estate Planning to find out more.