Joint tenant with mum - does she need to make a will?

localhero

sebastianj wrote:

Confused, so in what circumstances TIC will be relevant, i thought it was to safeguard against Health care expenses?

There are pros and cons, depending on the circumstances of the individual.

I've answered a similar question here: http://forums.moneysavingexpert.com/showthread.html?t=1531061&highlight=iht

freeasabird

localhero wrote: »

I'm afraid inheritance tax is levied on the estate of the deceased and the estate does include jointly owned property.

Depending on what the brother's share of the property is worth will determine whether or not IHT will be liable.

If there is an IHT liability on the asset, I'm afraid also that it's payable by the person entitled to the asset after the deceased's death.

How do you work out someone's share of the property? I would have thought in my case, it's 50% each but how do I know for certain?

EdInvestor

localhero wrote: »

I'm afraid inheritance tax is levied on the estate of the deceased and the estate does include jointly owned property.

Depending on what the brother's share of the property is worth will determine whether or not IHT will be liable.

If there is an IHT liability on the asset, I'm afraid also that it's payable by the person entitled to the asset after the deceased's death.

Surely IHT is payable by the estate, and all assets (properties, shares, cash etc) would be aggregated together and the amount charged as a percentage of the total?

localhero

freeasabird wrote:

How do you work out someone's share of the property?

You will need to work out what the 'beneficial interest' is of each party, and to do that you will need to work out what each party has contributed towards the property, ie the deposit, any improvements and mortgage contributions etc. Otherwise your executors will need to resolve it at the probate stage.

If upon the death of either party, then if the estate is valued above the nil rate band, then an account will need to be submitted to the Revenue. Where an account is submitted, and assets held jointly, the following information will need to be provided to the best of the personal representative's knowledge:

• who the other joint owner is, and their relationship to the deceased
• when the item was acquired
• how much each joint owner provided to acquire the item
• who received the income or interest if there was any
• who received the benefit of any withdrawals from bank accounts if any were made (obviously not relevant here)
• whether the item passes to the joint owner by survivorship or under the Will

EdInvestor wrote:

Surely IHT is payable by the estate, and all assets (properties, shares, cash etc) would be aggregated together and the amount charged as a percentage of the total?

Edinvestor, IHT would be calculated on those lines, but ultimately who is responsible for it may require the value (and therefore the IHT) of each asset to be apportioned appropriately. The general rule is that IHT on joint assets passing by survivorship is borne by the co-owner unless a contrary intention is shown (ie in the Will).

A Grant of Probate may not even by required, but there may still be IHT due on the asset - though of course we haven't been told the value of the property.

freeasabird

The value of the property is about £190,000 to £200,000.

sloughflint

freeasabird wrote: »

The value of the property is about £190,000 to £200,000.

freeasabird wrote: »

She hasn't got much money (I'll just be glad if she doesn't leave any debts)

So IHT will not be an issue when your mother passes.

freeasabird

sloughflint wrote: »

So IHT will not be an issue when your mother passes.

That's the first good news I've had this week. Thank you.

McKneff

Hopefully, it wont be for a long time

freeasabird

anniehanlon wrote: »

Hopefully, it wont be for a long time

I hope so too.