The legal rights of children and spouses in Scotland explained: Forced inheritance

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Legal rights are a form of forced inheritance. The legal rights of spouses and children are a right not to be entirely disinherited. We explain in more detail below.

This is a right of collection up to the net movable assets of the deceased person. Legal rights transcend the will and constitute a right. Net movable assets are after deduction of debts and certain charges.

The legal movable heritage excludes land and buildings so that they can be left to whoever you want. However, land and buildings are included in the pot of legal rights if they are incorporated into a business, that is, when the land is in partnership or owned by a corporation.

The legal rights to the net movable assets are as follows: –

• If there is a spouse and one or more children – the spouse has 1/3 and the child or children 1/3 (equally between or among them, so five children would receive 1/5 each of 1/3, or 1/15th each);

• If there is only one spouse – 1/2;

• If there are only children and no spouse – 1/2;

If legal rights are a concern, there are different planning options:

• Ask your spouse and/or child(ren) to waive their legal rights now. If a waiver doesn’t happen, you know you have a problem and can plan accordingly;

• Offer assets to the future heir during your lifetime. However, affordability and taxation should be considered before donating for life;

• If affordability is an issue, you can create a trust for yourself and your future heirs and transfer the assets to this trust. The tax should be taken into account;

• You could build other assets to meet demand. Life insurance could be considered to achieve a similar result;

• Pensions are generally protected from legal rights;

• The person who assumes legal rights also cannot take everything that has been bequeathed to him in terms of a will. It might be possible to tempt them with provisions in the will;

• If the land and buildings are the subject of a partnership, they are vulnerable to a claim of legal rights. Additional advice can be given on protection;

• Invest in land and buildings. The Scottish Government has recently considered reforming statutory rights to extend to land and buildings, but has decided not to pursue this reform;

Legal rights transcend the will and constitute a right. This can prevent your wishes from coming true, but you can minimize this through planning.

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