End of administration period - CGT

tsp1

As executor of an estate I have just recently disposed of all the assets. However, I have not yet distributed the legacies to the beneficiaries.

HMRC have said that they will deal with the administration period informally. I have already told them what assets have been sold and how much untaxed income the estate gained during the administration period. I am now waiting a reply.

I know that there is no CGT to be paid on the estate, so my question is do I have to wait for their response or can I now distribute the moeny to each of the beneficiaries? Thanks for everyone's help.

John_Pierpoint

I am now waiting a reply. Me too, only today I sent yet another letter to ask how they were getting on now we are in the third month of silence.

The executor (trustee) has the liability legally so don't hand out so much that you leave yourself exposed.
Presumably you have already published "a two month notice" and no new creditors have come forward?
You obtained probate 6 months ago and no "extra" beneficiary has waded in trying to make a claim (eg unknown "love child" appeared)?
All the beneficiaries are over 18 and able to give you a valid receipt?
So you now only face demands for money from HMRC for more Income Tax (Any IHT involved?).
Provided the estate is only now receiving savings income with 20% tax taken off, you won't be running up further liabilities.
If the will hands out specific bequests (eg to my nephew the sum of 10,000 pounds) that nephew can demand that you pay him interest if you fail to pay out the 10K within 12 months of the death.
But don't be bullied by demanding beneficiaries, or their so called professional advisers, especially during "the executor's year".

Alternatively you could end up running a trust of some assets for years and years waiting for someone to get to age 18 or because there is land and the beneficiaries cannot settle the distribution between themselves and won't agree to sell; though in your case you appear to have already exercised your rights to sell everything as the legal owner of the estate's assets.

BTW when you start to pay out it is assumed that you are paying income before capital so you will need to give them their form R185's before the end of next May.


[Now tell me you are in Scotland where different laws may apply:D]