Reasonable Financial Provision and the Inheritance (Provision for Family and Dependants) Act 1975

Reasonable Financial Provision

Reasonable financial provision is that which is given by the court for the financial needs and/or maintenance of the applicant.  This is taken from the deceased’s net estate.

Net Estate

The net estate is composed of all of the deceased’s property – both real and personal properties – which had the power to dispose of by his/her will less the funeral, testamentary and administrative expenses, debts and liabilities including any inheritance tax payable out of the death estate.

How the Court determines Reasonable Financial Provision

Surviving Spouse/Partner

If the applicant is the surviving spouse/partner, the court will consider what the applicant should expect to receive from the estate as the spouse/partner of the deceased whether or not this is necessary for their maintenance.

If the surviving spouse/partner was judicially separated from the deceased, s/he can also claim under the Act but would only be awarded at the lower level of the provision that can be awarded to applicants.

If the marriage was void/voidable, the applicant can apply as the surviving spouse/partner.

Former Spouse/Partner

It is possible for a former spouse/partner to apply under the Act provided that they have not remarried or entered into another relationship prior to the death of the former spouse.  If remarriage takes place, the provision will be for maintenance between the dates of death and marriage.

If a Section 15 or 15A Order (an order that prevents the former spouse from claiming against the deceased’s estate) is included in the decree of divorce, nullity, or judicial separation, any application under the I(PFD)A 1975 will not prosper.

Other Applicants

The Court will base their decision on the facts of the case to determine the reasonable financial provision needed for the applicant’s maintenance.  This category includes the cohabite, child of the deceased, person child considered to be a child of the marriage, adopted children, illegitimate children, or any person maintained by the deceased two years immediately before the death.

Types of Payment Orders

Lump Sum Payment

Taken from the deceased’s net estate as a full and final financial provision.

Property Transfer

Specific property which is part of the net estate is transferred to the applicant for his Benefit. Settlement for the Benefit of the Applicant

The benefit coming from a specified property in the net estate is set aside for the applicant’s financial needs.

Acquisition and Transfer of property

The court can order that ownership of property appropriated from the net estate is transferred to the applicant’s name as his/her settlement.

Variation Order

Any ante- or post- nuptial agreements made where one of the parties to the marriage is the deceased.  Any change made will only be for the benefit of the surviving spouse, or any child or person treated as a child of that marriage by the deceased.

Periodic Payments

Depending on the facts of the case, this can either be a lump sum; payments equal to either the net estate’s entire income or a specific portion of that income; or payments equal to the whole of the income of the property appropriated for the applicant’s benefit at the date of the payment order.  The court will not appropriate more property than is necessary to satisfy the application for financial provision.

Once the court makes an order, it cannot be varied and will be effective from the date of death.  The order can be against assets that could have been given by will, nominated property, the deceased share of a joint tenancy, donations mortis causa, and lifetime gifts.