Deed of variation or Gift???
Comments
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getmore4less wrote: »A DOV will remove the same amount of transferable nil rate band if the mother is spouse of the father.
gifting will be IHT neutral for 7 years then add the size of the gift to the survivors nil rate band.
Ahhhhh, beat me to it! I was just coming back to edit my post, as I had forgotten that it would use up £90k of the fathers band......:D0 -
My mother is living in a council house and has her pensions, she wants nothing to do with the money, she doesn't have any benefits that are means tested in that she already has over £16K before this money hits the executor account and is happy with what she has, there are no assets. Don't worry, we're not strong arming or anything, it was both my father's and my mother's wishes, just unfortunately worded Will in that left everything to mum, obviously something we didn't look at closely, otherwise would have saved on money for DOV. (quote of 450 to 750 + VAT)
So it seems a DOV is the correct legal way to go to allow the sole beneficiary (my mum) to redirect the claim award part of the will to whoever she decides. Does this seem correct? ThanksMortgage Started Nov 2018
2 year fixed 1.78%, £336pcm, 23yrs 2 mths remaining
Deal ends 30/11/2019
Current Balance 23/8/2018 £76K
Want to be Mortgage Free by Dec 20220 -
My mother is living in a council house and has her pensions, she wants nothing to do with the money, she doesn't have any benefits that are means tested in that she already has over £16K before this money hits the executor account and is happy with what she has, there are no assets. Don't worry, we're not strong arming or anything, it was both my father's and my mother's wishes, just unfortunately worded Will in that left everything to mum
She might not but, if she needs care, the council will unless she had a very large sum in savings.
Read up on DOA - deprivation of assets - before Mum gives it away and the money gets spent.0 -
My mother is living in a council house and has her pensions, she wants nothing to do with the money, she doesn't have any benefits that are means tested in that she already has over £16K before this money hits the executor account and is happy with what she has, there are no assets. Don't worry, we're not strong arming or anything, it was both my father's and my mother's wishes, just unfortunately worded Will in that left everything to mum, obviously something we didn't look at closely, otherwise would have saved on money for DOV. (quote of 450 to 750 + VAT)
So it seems a DOV is the correct legal way to go to allow the sole beneficiary (my mum) to redirect the claim award part of the will to whoever she decides. Does this seem correct? Thanks
A DOV is still a gift just has tax benefits.
There are no tax benefits over a normal gift why bother.0 -
Many thanks for your input, regarding the DOA there is already a care plan in place for my mother when she needs it which was put in place many years ago and both mum and dad provided for this.Read up on DOA - deprivation of assets - before Mum gives it away and the money gets spent.
Regarding the DOV, is the DIY version easy to do or just bite the bullet and get it done by a solicitor, there is only mum as beneficiary, no impact on IHT as only £90K, is this all we need to consider?Mortgage Started Nov 2018
2 year fixed 1.78%, £336pcm, 23yrs 2 mths remaining
Deal ends 30/11/2019
Current Balance 23/8/2018 £76K
Want to be Mortgage Free by Dec 20220 -
Does the amount for the claim actually form, an albeit delayed, part of your father's estate?Many thanks for your input, regarding the DOA there is already a care plan in place for my mother when she needs it which was put in place many years ago and both mum and dad provided for this.
Regarding the DOV, is the DIY version easy to do or just bite the bullet and get it done by a solicitor, there is only mum as beneficiary, no impact on IHT as only £90K, is this all we need to consider?0 -
Yes, on the will it states all proceeds to go to my wifeMortgage Started Nov 2018
2 year fixed 1.78%, £336pcm, 23yrs 2 mths remaining
Deal ends 30/11/2019
Current Balance 23/8/2018 £76K
Want to be Mortgage Free by Dec 20220 -
The usual reason for using a DoV to transfer money from parent to (say) grandchild rather than parent to child is that if the child dies within seven years AND has themselves an estate (including the gift) that is subject to IHT, then there will be IHT, whereas by transferring it direct to the grandchild that is avoided. It's not clear to me from the account of what's going on as to why a DoV to give money to the child, rather than a spouse, helps.
It's also not obvious from the OP as to why the other children of the claimant would be willing to sign a DoV.
There is a Deprivation of Assets issue if and only if the mother is currently likely to require care in the immediate future.
I can't really see why the DoV is needed.0 -
Many thanks for your input, regarding the DOA there is already a care plan in place for my mother when she needs it which was put in place many years ago and both mum and dad provided for this.
Regarding the DOV, is the DIY version easy to do or just bite the bullet and get it done by a solicitor, there is only mum as beneficiary, no impact on IHT as only £90K, is this all we need to consider?
Baring in mind that you parents have very little in the way of assets how on earth did they manage to finance this?0 -
I'd advise legal route because this is a legal document with implications if you get it wrong, but you will, as stated, need to get a move on.Regarding the DOV, is the DIY version easy to do or just bite the bullet and get it done by a solicitor, there is only mum as beneficiary, no impact on IHT as only £90K, is this all we need to consider?Signature removed for peace of mind0
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