When wealth outpaces planning: the risks of dying intestate in the case of young HNWs

While the full details of Liam Payne’s estate remain unconfirmed, the principle is clear. Where wealth is accumulated rapidly, through commercial success or otherwise, estate planning frequently lags behind. In this briefing, Hardeep Nijher explains how the resultant mismatch can cause significant legal, tax, and personal complications for those left behind.

The intestacy rules in England and Wales operate as a rigid framework, determining the distribution of an estate in the absence of a Will. These rules do not take into account modern family dynamics, unmarried partners, or the intentions of the deceased. In Liam Payne’s case, for example, he was unmarried at the time of death, his partner (reportedly Kate Cassidy, an American social media influencer) would have no automatic entitlement under the intestacy rules, regardless of the closeness or duration of their relationship.

Children may inherit at a statutory age, typically 18, regardless of whether they are emotionally or financially prepared to receive and manage substantial assets. If there are minor beneficiaries, the estate (or their share of it) may pass into a statutory trust, often administered by the Public Trustee or more likely, other appointed trustees under the rules of the Administration of Estates Act 1925. This may be far removed from the bespoke arrangements many clients would have envisaged.

When estates pass into trust by operation of law rather than by deliberate planning, the outcome is often less efficient, both in terms of asset management and tax exposure. Trusts created under intestacy rules are typically inflexible, lack tailored provisions, and may not provide the long-term control, protection, or tax mitigation that a professionally drafted Will trust would achieve.

Moreover, intestacy rules may inadvertently trigger trust structures under statutory rules that do not qualify for reliefs or exemptions otherwise available under carefully planned Wills. This can result in unanticipated Inheritance Tax (IHT) charges under the relevant property regime.

From an IHT perspective, intestacy often leads to inefficient use of available allowances. The nil-rate band and residence nil-rate band may not be fully utilised if assets are not distributed in the most tax-efficient manner. Likewise, charitable intentions, which is often common among public figures, are lost entirely unless expressed formally, resulting in increased IHT liabilities that might otherwise have been mitigated.

Furthermore, in the absence of a Will, executors (technically administrators, in this case) have limited discretionary powers, which may frustrate efforts to posthumously implement planning through variations or elections that would have been straightforward under a Will.

Although Liam Payne died intestate, his long-term partner, Kate Cassidy, may have grounds to bring a claim under the Inheritance (Provision for Family and Dependants) Act 1975. This statute allows individuals who were being financially maintained by the deceased immediately prior to death to apply for reasonable financial provision from the estate, even if they are not a spouse or civil partner.  As publicly reported, Cassidy and Liam were in a committed relationship and cohabiting, with Cassidy allegedly financially dependent on him during that time. If she can establish the extent and regularity of that dependence, she may be able to argue that the statutory intestacy rules fail to make adequate provision for her. The strength of such a claim would depend on the evidence available, such as shared financial arrangements, lifestyle, and any plans for marriage, and the discretion of the court, particularly given the size of the estate and the competing interest of his minor child. This potential costly litigation process would have been avoided had Liam made a Will and factored Kate into his planning.  

The reality is stark: the absence of a Will shifts control from the individual to a statutory formula. For young HNWIs, many of whom are still navigating their financial maturity, this can lead to outcomes wholly inconsistent with their values, wishes, and family structures.

As trusted advisers, we must continue to encourage young clients, particularly those whose wealth profile changes rapidly, to put appropriate testamentary arrangements in place early and to revisit them regularly. Estate planning is not just a matter for the elderly; it is a fundamental element of wealth stewardship at every stage of life.