UK Law and Practice Contributed by: Ros Bever, Claire-Marie Cornford, Helen Clarke and Ashley Hill, Irwin Mitchell
Laws ). Separate wills in relevant jurisdictions often remain advisable, not least for ease of the probate process according to local laws. 2.3 Forced Heirship Laws The following applies for those domiciled in England • if not disposed of by will, statutory rules of intesta - cy determine the distribution of the estate accord - ing to proximity of relationship to the deceased; and • there is, however, a statutory basis for claim by certain relations and dependents not reasonably provided for by the deceased’s will or under the intestacy rules. For those domiciled in Scotland, testamentary free - dom is tempered by a statutory framework of legal rights, particularly for spouses, civil partners and chil - dren of the deceased. and Wales or in Northern Ireland: • testamentary freedom prevails; Forced heirship rules of other jurisdictions can be relevant for UK-resident nationals owning real estate outside the UK, unless an effective choice of UK law is made by reference to the EU Succession Regulation, where applicable. 2.4 Marital Property A concept of matrimonial property versus non-matri - monial assets is relevant in the UK in the context of division of assets on divorce. This has been developed by case law (save that in Scotland there is a statutory definition of what constitutes matrimonial property). Broadly speaking, the jurisdiction of the courts within the four nations making up the UK revolves around domicile and habitual residence. The existence of a former matrimonial home within the jurisdiction can also be a factor. Non-matrimonial property is typically property brought into or acquired by one party to the marriage from an external source such as a gift or inheritance (albeit such property can become “matrimonialised” depend - ing on how it is viewed and treated by the parties to the marriage).
The court has discretion to take into account “non- marital” assets to achieve a fair outcome on divorce by reference to needs (whereas the starting point for division of matrimonial assets is usually an equal split). Pre- and postnuptial agreements are not formally binding in England, Wales and Northern Ireland. How - ever, they are taken into account and can be decisive in financial proceedings (provided the outcome is not unfair, leaving one party in financial need or prejudic - ing reasonable provision for the children, for example). The Law Commission has recommended the intro - duction of qualifying nuptial agreements (QNAs) to provide greater certainty and enforceability, subject to conditions such as the inability to contract out of financial needs. In Scotland, pre- and postnuptial agreements are viewed as being enforceable as a contract, subject to general contract law principles. To demonstrate that both parties understood the implications and that neither had been unduly influ - enced to enter into a nuptial agreement, there should be full financial disclosure and independent legal advice for each party. Prenuptial agreements should be concluded well in advance of the marriage or civil partnership ceremony. As the approach to enforcement of nuptial agree - ments can differ significantly across borders, joined- up international advice is needed where the parties have assets in different jurisdictions, particularly if place of domicile or residence may be in issue or prone to change. 2.5 Transfer of Property UK CGT applies when a chargeable person (eg, an individual or trustee) makes a chargeable disposal (eg, a sale or gift) of a chargeable asset (anything not specifically exempt under legislation, such as cash). When a disposal is made during a lifetime, the gain to which CGT applies is generally based on the pro - ceeds of sale or on the market value at the time of transfer (including on disposal between certain con - nected parties).
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