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  • FIRST POST
    • drs5
    • By drs5 12th Sep 17, 10:41 AM
    • 3Posts
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    drs5
    Scotland legal rights and other property
    • #1
    • 12th Sep 17, 10:41 AM
    Scotland legal rights and other property 12th Sep 17 at 10:41 AM
    My parents have an estate that includes a house, some cash/shares, and some land. There are 3 children (me and 2 sisters). 1 sister makes an income from the land (it is forestry so has tax benefits). My parents are thinking that to make their life easier and reduce risk on the other two siblings if the business fails that they give this sister the land in lieu of her share of the estate - thus removing it from the estate. Currently they value the land as being an equal share. No on the face of it this looks a sensible move and we can live with the risk that in the future this might mean that the shares are not so equal when my parents have passed away.

    But in Scots law - there are "legal rights" - I have read up on these and it makes sense that the land is not part of the estate - so my sister could turn around and claim her legal rights - reducing the share myself and my other sister inherit. As this is not my parents' intention is anyone aware how this can be handled in Scots Law to avoid this situation?

    At present we all get on well, but you never know what the future brings and how people will react to the death of parents - so rather than rely on good moral conduct we wish to explore if there is a legal way to protect my parents' intentions?
Page 1
    • Yorkshireman99
    • By Yorkshireman99 12th Sep 17, 12:19 PM
    • 2,963 Posts
    • 2,319 Thanks
    Yorkshireman99
    • #2
    • 12th Sep 17, 12:19 PM
    • #2
    • 12th Sep 17, 12:19 PM
    My parents have an estate that includes a house, some cash/shares, and some land. There are 3 children (me and 2 sisters). 1 sister makes an income from the land (it is forestry so has tax benefits). My parents are thinking that to make their life easier and reduce risk on the other two siblings if the business fails that they give this sister the land in lieu of her share of the estate - thus removing it from the estate. Currently they value the land as being an equal share. No on the face of it this looks a sensible move and we can live with the risk that in the future this might mean that the shares are not so equal when my parents have passed away.

    But in Scots law - there are "legal rights" - I have read up on these and it makes sense that the land is not part of the estate - so my sister could turn around and claim her legal rights - reducing the share myself and my other sister inherit. As this is not my parents' intention is anyone aware how this can be handled in Scots Law to avoid this situation?

    At present we all get on well, but you never know what the future brings and how people will react to the death of parents - so rather than rely on good moral conduct we wish to explore if there is a legal way to protect my parents' intentions?
    Originally posted by drs5
    Your parents need to take paid for professional advice about what the options are.This also needs to include an IHT specialist.
    • TBagpuss
    • By TBagpuss 12th Sep 17, 12:57 PM
    • 5,874 Posts
    • 7,622 Thanks
    TBagpuss
    • #3
    • 12th Sep 17, 12:57 PM
    • #3
    • 12th Sep 17, 12:57 PM
    I agree, your parents will need to take proper, professional advice.

    They may be able to find a way round, whether it involves transferring the land to all three of you with your sister paying rent during your parents lifetimes, or it may be possible for your sister to sing some kind of disclaimer in advance, but your parents need to get proper advice, and it may also be necessary for your sister to get separate advice, particularly if there is any kind of disclaimer she could sign.
    • Keep pedalling
    • By Keep pedalling 12th Sep 17, 1:27 PM
    • 3,573 Posts
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    Keep pedalling
    • #4
    • 12th Sep 17, 1:27 PM
    • #4
    • 12th Sep 17, 1:27 PM
    Agree that this requires professional advice. The issue is the movable assets (cash and shares) which if she chose to she could claim a share.

    The other issue is the 7 years rule which could mean the remaining estate is hit with additional IHT, which would come out of your shares not hers. No doubt this can all be resolved but it is not something that can be DIYed.
    • drs5
    • By drs5 12th Sep 17, 1:49 PM
    • 3 Posts
    • 0 Thanks
    drs5
    • #5
    • 12th Sep 17, 1:49 PM
    • #5
    • 12th Sep 17, 1:49 PM
    Thanks for all the replies - pretty much thought that professional advice would be required here, but was optimistic someone might have prior experience that might reduce the amount of advice.

    IHT is a concern, but as the land is classified as forestry different rules apply to it iro IHT. But if any part of it was considered outside that scope then agree the IHT would be paid from the remaining moveable estate.

    We had considered a wavier type agreement, but were unsure if that would carry much real weight if challenged. It was very much about ensuring that after their passing my parents' wishes are carried out and there is little squabbling as there is no real scope to squabble over things - just makes things simpler and allows everyone to move on as wanted - ie still friends!
    • Yorkshireman99
    • By Yorkshireman99 12th Sep 17, 3:56 PM
    • 2,963 Posts
    • 2,319 Thanks
    Yorkshireman99
    • #6
    • 12th Sep 17, 3:56 PM
    • #6
    • 12th Sep 17, 3:56 PM
    There really are far too many variables for any detailed advice from anyone but a paid professional. See if any neighbours have experience with a local specialist certainly not a will writer.
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