The importance of having a Will: Lessons from Liam Payne’s Estate

Liam Payne, the former One Direction singer, sadly died in Argentina in October 2024 reportedly without a Will in place. This means that Payne’s net estate of apparently just over £24.3million will pass in accordance with the statutory intestacy rules of England and Wales (the “Intestacy Rules”). The Intestacy Rules are rigid and follow a strict hierarchy of inheritance, and do not account for what may have been the deceased’s wishes.

Who will inherit?

Payne was unmarried, but was survived by a partner of two years, both parents, two siblings and an eight-year-old son with his former partner, Cheryl Tweedy.

Under the Intestacy Rules, there is a particular order for inheritance depending on whether the deceased was married (or in a civil partnership), had children, or has other living relatives:

• Married (with children): up to the value of (currently) £322,000 and the deceased’s chattels pass to the spouse (or civil partner), and the remainder is split one half for the spouse (or civil partner) and the other half for the children.
• Married (without children): the estate passes to the spouse (or civil partner).
• Unmarried (with children): the estate passes to the children.
• Unmarried (without children): the estate passes to the deceased’s parents, or if there are no living parents then siblings and so on (depending on living relatives at the time).

Therefore, Payne’s entire estate will pass to his son. His long-standing partner, siblings and parents will inherit nothing.

Whilst Payne’s son is a minor (i.e. under the age of 18), the estate will be held on trust for him by the administrators of his estate (the “Statutory Trust”). Once he turns 18, and unless there are any successful claims to the estate by other relatives or dependents before then, he will inherit the entire estate outright.

Who are the administrators?

As Payne did not have a Will, there were no executors appointed to administer the estate. Instead, the people with the right to apply to act are identified by law under the Non-Contentious Probate Rules (the “Probate Rules”). Once identified, such individuals can apply to court for Letters of Administration to grant them the necessary administrative powers to (a) deal with the administration of the estate and (b) act as the first trustees of the Statutory Trust.

The Probate Rules largely mirror the Intestacy Rules in that the administrators will be the same as the beneficiaries. However, as Payne’s son is a minor and unable to take up the role, the Letters of Administration have been obtained by Tweedy and Richard Bray, a music industry lawyer. Under the Probate Rules, two administrators are required when some or all of the estate is to be held for minors.

What are the issues?

• Beneficiaries: Other than his son, Payne’s relatives and loved ones are not provided for under the Intestacy Rules, which is unlikely to be what he would have wanted. Payne may also have wanted to leave legacies for charities or other institutions which carried meaning for him during his life, which he has been prevented from doing. Payne’s partner may consider bringing a claim for reasonable financial provision under the Inheritance (Provision for Family and Dependents) Act 1975, which provides an avenue for those who were either cohabiting with the deceased for in excess of two years or more, or financially dependent on the deceased, even if they were not married. There will, however, be many hurdles to overcome to prove that she satisfies the necessary criteria. Furthermore, not only will there be the financial burden of bringing a claim, but this is a battle that she likely would not have endured had Payne left a Will in the first place.
• Appointment of administrators: In the absence of a Will, Payne has not been able to control who manages and administers his estate and, pertinently here, who will decide how his son’s inheritance will be managed until his son turns 18. Instead, Tweedy and Bray have been appointed to fulfil this role. Administrators bear great responsibility over the deceased’s estate and the role can be very complex, particularly when there is significant wealth at stake. Payne may have preferred to allocate this responsibility elsewhere, for example to professional trustees or other friends / relatives.

• The son’s absolute right to the estate: At the age of 18, Payne’s son will be entitled to inherit the entire sizeable estate in full. This is a significantly large fortune for an 18-year-old to have outright without any wealth protections in place. Payne could have implemented provisions in his Will to pass assets to, or to be used for, his son incrementally in ‘instalments’ over time, for example by leaving flexibility and instructions with his chosen trustees by setting up a discretionary trust.
• Inheritance tax and wealth planning: When someone dies, their estate is taxed at 40% (subject to the deduction for any allowances or relief, such as the ‘nil rate band’, spouse relief or gifts to charity). There are ways of mitigating the impact of inheritance tax through careful wealth planning and well-structured Wills. If, for example, Payne had left 10% of his estate to charity, the inheritance tax rate would have been reduced from 40% to 36%. As he has been unable to take advantage of this avenue, his entire estate will be taxed at 40%.

Takeaway

Had Payne left a Will, he would have been able to: (a) clearly identify who should inherit; (b) identify his executors and provide instructions for administration; and (c) put any long-term necessary wealth protections and plans in place for his son and future generations.

This is a stark reminder of the importance of having a Will in place, even at a young age, particularly when there is wealth at stake.

If you are considering making or updating your Will, please contact Matthew Barnett or any member of the Private Client team.

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