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Thanks getmore.. salient bit word for word:- 'I direct my trustees as soon as possible to give in writing to my said daughter (wife) the option of purchasing all my beneficial interest in (or the future proceeds of sale of) the properties (details included)'
I suspect that the intention was as you said
That does not sound like a legacy to me that says she has to buy it which will incur SDLT.
Who inherits the properties in the will.
snippits from wills rarely tell the full picture.0 -
I appreciate this is only a snippet - I can't type well enough to get the entire contents in!!getmore4less wrote: »That does not sound like a legacy to me that says she has to buy it which will incur SDLT.
Who inherits the properties in the will.
snippits from wills rarely tell the full picture.
I'm not sure if you are saying, do you think she will be liable for SDLT due to the wording in the will?
Re "who inherits the properties in the will", There is no other mention of the properties in his will other than wife having the option to purchase etc as detailed previously so I guess it would otherwise simply become part of his estate. Will states Trustees shall not sell his share or said properties unless and until wife has refused in writing such right of pre-emption.
Solicitor not in til 1pm so I'll call him then0 -
I wonder if the Will leaves the residue of his estate to his two daughters: your wife and sister in law? If so it might be worth looking into your wife not taking up the option to buy the 80% share in the property.
Instead the executors could satisfy the entitlements under the Will by appropriations of assets. If the values work out that could be by appropriating the 80% share in the property to your wife and stocks and shares to the same value to her sister.0 -
FIL owned 80% of a propertyThanks 00ec25
Thats exactly the situation.
I think SIL's husband is more savvy and has mentioned CGT.
I am about to call the solicitors but in answering getmore..'s message I wonder if having been given the 'option to purchase' is the bit that renders it liable for SDLT. It will be a bit unfair if it is as it was presumably written like that so if when the time came it was not an option then an alternative existed but the FIL clear and stated intention was for wife to get the properties and SIL to take the cash equivalent.
His will also stated that it was his wish but not binding that SIL sells her interest in properties to wife.
Ill see how the Solicitor explains it, he cannot blame the way it was written as he did it!
Thanks again
FIL is dead and the property is part of his estate
what does the will say about how his estate is to be shared out.
As SDLT geek says, it might make better context if the estate is to be valued as an entirety and then wife and SIL "fight" over the difference between what 80% of the property is worth in comparison to 50% of the estate. If the property is worth more than 50% then obviously wife needs to pay SIL something to redress the shortfall on SIL's slice of the action.
if that is the case I can see the benefit of the "option" wording as that then gives wife the first refusal at her having the property but ensures SIL gets money as recompense for not getting the property.
I'll leave SDLT geek to advise if SDLT would be due in such circumstance where a beneficiary buys out an asset of the estate in lieu of being given money from the liquidation of the estate's assets.0 -
If a beneficiary puts in their own money from resources outside of the inheritance to obtain a property interest then that outside money is chargeable consideration on which SDLT is due.I'll leave SDLT geek to advise if SDLT would be due in such circumstance where a beneficiary buys out an asset of the estate in lieu of being given money from the liquidation of the estate's assets.
But there is no chargeable consideration if the assets in the estate are sufficient for the value of one sister's entitlement to be met by land and the other sister's by other assets of the estate.0 -
OK, so I've spent an age talking to the solicitor and it is indeed the wording giving the option to purchase that appears to render it subject to SDLT
Solicitor has mentioned the apportioning bit and perhaps offering some of the saving in SDLT as an incentive to SIL to agree.
Had a brief chat with the BIL and his position is that they would be very unhappy if the 80% of full market value is discounted due to tenants in common situation.
Looks like someone is going to end up unhappy regardless of which way it goes.
SDLT Geek;, if we can get a discounted valuation due to tenants in common then there should be just about enough cash to balance it. If not then I'll be putting cash in so your comments are noted, thank you. That cash may come from a small legacy to which I am beneficiary and the split proceed of an insurance policy to which my wife is beneficiary - if that is the case does this fall within the 'resources outside of the inheritance'?
Thanks again for the continued help chaps0 -
If they are in agreement with each other about how to split the inheritace, in a way different to the will they could always get a deed of variation drawn up. It sounds like he wanted an even split, but did not think through the problems doing it this way could cause.0
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The standard discounting of valuations is for IHT.
The reality in a buyout situation where the alternative is to sell then the full market value should be used as the starting point.
then the discussion centres around the adjustment related to non incurred costs.0 -
I appreciate this is only a snippet - I can't type well enough to get the entire contents in!!
I'm not sure if you are saying, do you think she will be liable for SDLT due to the wording in the will?
Re "who inherits the properties in the will", There is no other mention of the properties in his will other than wife having the option to purchase etc as detailed previously so I guess it would otherwise simply become part of his estate. Will states Trustees shall not sell his share or said properties unless and until wife has refused in writing such right of pre-emption.
Solicitor not in til 1pm so I'll call him then
if the property is not mentioned anywhere else then it will fall in to the general distribution clause or the residual estate clause.
What do they say.
what are the assets totals here(that fall within the estate) we have 80% of the market value of the property and ??????.
What are the distributions0 -
Thanks for continuing support, just written long reply then hit refresh by accident and lost the lot!
I'll try again:-
Keep pedalling....:yes his intention was to have an even split of value between his two daughters with the properties going to wife to give some pension provision in later life. He had previously wanted to favour wife/me over (significantly better off) SIL/BIL but wife persuaded him to even things out for fairness. It is my belief that he knew his 80% share would be discounted by the way his instructions are worded. If an agreed value cannot be negotiated then there is recourse to having RICS appointed valuation. I have found out that this will cost minimum of a grand but also that it could come back with a figure that may be discounted by possibly 10-15%. This would make the BIL even less happy. Should we go this route then it would be understood that we both sign up to accepting the RICS valuation, this route also immediately means that wife has exercised the option to take the properties with the SDLT implications and that if we go this route then there can be no apportioning can be done.
getmore4.....Discounting in this instance is due to tenants in common with any share being worth less than actual %age on the open market.
The will indicates that the market value should not take into account that parts are owned by the daughters. BIL has interpretted this as simply taking 80% of om value. Solicitor states that the meaning is to ignore WHO owns the shares but still value as a share of a tenants in common property.
Probably missed some of the points I had covered in my first draft!
Thanks again guys0
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