Probate, Inland revenue and house sales

silvercar

If anyone can offer advice please do so.

In a house selling chain, at the top sits a lady who lost her husband some time last year. She was selling the house last summer but it all fell apart because of some requirement between probate/ revenue etc.

We only joined this chain in December. Everything was then allegedly in place, probate had supposedly been sorted. 5 people in this chain. By yesterday everything was lined up for exchange next week, everyone had had surveys etc and we are all feeling confident when her solicitor says that she won't (or can't) exchange without some document from the revenue. This could apparently take between 1 and 3 weeks. We are in the centre of the chain. Everyone is prepared to wait if it really is 1-3 weeks except the first time buyers who are getting really irritated. They are talking of pulling out.

Apparently she has been advised by her solicitor not to exchange without this document which we interpret to mean its not in her interests to do so, as opposed to legally she can't.

Can anyone guess what this doument might be an more importantly how long it may take to get?

silvercar

No-one help????

OK I'm guessing its a certificate of completion (which shows the revenue have agreed the value of the estate etc). Anyone know how quickly the revenue produce these?

kaznei

Is it the grant of probate they need? They can't touch the assets without this. (I am a probate assistant and we deal with this all the time).

kaznei

Ooops - just seen that it is an Inland Revenue document - maybe the IHT200 or something. This shows the assets and liabilities of an estate. I'll run it by my boss if you want.

Mary_Hartnell

Hi People,

I have been involved in buying two houses, one an executors' sale and one a building society repossession (Bankrupcy is "living death"), both transactions were delay free, hassle free and chain free, infact the repossession was a DIY conveyance.

I've been an executor twice and had to sell a house both times, in both cases the house was valued over the IHT zero rate band.

Back in 1997 I was able to sell the house and then finish paying the tax (I got some flack from a greedy beneficiary, who expected to get their share BEFORE I had got final agreement from the tax man - I paid them some money on account and told them to wait for the rest).

In 2005 the position has been tightened up, now that houses at least in the London area are into the IHT 40 percent rate. I had to settle with the tax man and them sell the house. As my brother and I were the beneficiaries, as soon as we got probate we transferred the house into our names at the probate value and then sold it as private individuals for a little over the probate valuation. The 100 GBP it cost to fill in the form I got from the Land Registry, probably was saved in solicitors costs because we avoided all the hassle of the buyer's solicitor needing to check who had died etc. etc.

I would say that the seller(s) at least owe(s), you all an explanation of exactly why there is a delay. I would find out who the personal representatives are and go and see them - they are the people in charge, a solicitor stands behind his client, like an insurance company. Of course, if the solicitor involved is also the executor, you are stuck at square one!

The IHT200 is the central document of the tax return for estates paying IHT, just like a personal income tax return, there are supplementary pages called "Dxx" for detailing classes of assets etc. All that should have been completed and the tax paid before probate was granted; so I suspect the delay is something more serious/complex/cocked-up ? Can you get your hands on a copy of the will (if there is one and if it has gone through probate), that could give you an insite into the complexity of the estate. Who currently appears to own the house at the head of the chain ? (2GBP at the Land Reqistry site should get the answer to that question, assuming it is registered).

Good luck.

Mary

silvercar

Thanks for responding. I am beginning to get a clearer picture now.

I have spoken to the my seller who has spoken to the lady at the top of the chain.

She had a mortgage free house until 2003 when he (as in her now deceased husband) took a business loan against it. Now that he is no longer around the estate needs to include this business loan to reduce IHT - I'm guessing. She is probably being advised that it is best to get a completion certificate on the tax due on the estate before she exchanges. The sale of the house will mean she has to settle the IHT, so she wants the security of knowing that the revenue won't call the business loan her mortgage and deliver her a larger IHT bill than she is expecting.

The house was in joint names until 1990 when it was put into her name. So technically the house is hers to sell. But, as he took a business loan on it in 2003, it could appear that the business loan was her mortgage if she buys and sells before the estate is sorted. I guess the shock of finding out your husband had taken a business loan against your house is enough to make you cautious on future dealings but its really screwwing everyone else up.

I can't think of any other reason for this.

Assuming the finances are sorted and just submitted to the revenue for their seal of approval, how long do the revenue take to rubber stamp it?

Everone along the chain has now calmed down a little but I don't know how long for!