What to do when a partner/spouse dies.

cj1967xx

NAR wrote: »

If the estate, with the £25k, is over the Inheritance Tax Limit then yes IHT will have to be paid from the estate.

??? What did you pay back in cash? Was it a gift or a loan?

it was both we paid back 7k and half of orginal 12k was gift other loan..but it comes under the 325 k inhertaince tax bracket so we should be ok .one last thing if there house in joint names do we put it down as half value as mum still alive and half hers .also thanku so muchfor replying this is a mind field at a emotional time ty x

getmore4less

cj1967xx wrote: »

it was both we paid back 7k and half of orginal 12k was gift other loan..but it comes under the 325 k inhertaince tax bracket so we should be ok .one last thing if there house in joint names do we put it down as half value as mum still alive and half hers .also thanku so muchfor replying this is a mind field at a emotional time ty x

You need to read the notes that come with the IHT205 and the IHT400

They explain what you have to do to value assets and what needs filling.

If the estate is going to spouse then there are exemptions and you need to get this right for the transferable nill rate band on her death.

There are books that can help the local library should have them.

You need to look back 7 year for gifts loans are different they are a debt tothe estate if they have not been repaid and need collecting.

Was there a will?.

cj1967xx

getmore4less wrote: »

You need to read the notes that come with the IHT205 and the IHT400

They explain what you have to do to value assets and what needs filling.

If the estate is going to spouse then there are exemptions and you need to get this right for the transferable nill rate band on her death.

There are books that can help the local library should have them.

You need to look back 7 year for gifts loans are different they are a debt tothe estate if they have not been repaid and need collecting.

Was there a will?.

yes ther is a will and debt has been paid but they just used cash etc for whatever they wanted ie new sofa holiday , but obviously they wrote cheque for 25k

hyersal

Hello, I am looking for a bit of help. A good friends husband died last week (suicide). She has 2 young school age children. She has asked me to help her try and understand the financial implications. He had no will, they have a joint mortgage (up to date but not with a high street lender), he was self employed and she is part time self employed but will not be working in the immediate future. He has some small debts in his name - I understand they are for items such as courses related to his work qualifications. Any savings will be eaten up by the funeral.

She is aware that his life cover will not pay out in this circumstance.

Her immediate concerns are will she have to go to probate and what does this actually mean?

Is she liable for his debts?

If she is unable to pay the next instalment of the mortgage (very likely with no income) is she best to contact the company up front?

Anywhere you can point me to that might help with the many questions she hasn't yet thought of?

I am trying my best to help her with the more mundane side of things and I am fully aware that while these things need addressing asap each step towards doing this will make her feel like she is erasing him.

Any help would be appreciated as neither of us have had to face anything like this before.

John_Pierpoint

Can I express my sympathy, as I was just 21 and my sister was still at school, when our father died of a heart attack, leaving our mother as a widow, who had been out of the labour market for 21 years.
Things like houses mortgages and bank accounts if owned as "joint" with her late husband can be transferred into the name of the widow, just on the authority of the death certificate.
Don't worry about the grant of "probate" or letters of administration (for the majority of estates because there is no will to appoint executors), as that procedure can take months. In the probate court office the clerks refer to "admon" as shorthand to cover both possibilities.
The important thing is to see a welfare rights officer and get the flow of benefits enhanced. Some trades and professions have an organisation that can help out is such distress situations.
Can both his and her relatives help in any way? (My mother died still bitter about the attitudes of some relatives).
It could well be useful to start a new thread on here in the welfare rights section of the forum and carefully explain the financial predicament and the assets & liabilities of "the estate" (ie establish the "net worth" of the dead husband).

There are a lot of supportive posters on this forum, who will be sympathetic and will help with specific questions. Having a master check list will help. "Which?" publishes three books on this topic and the Library should have those and similar guides; though it is important to realise that procedures and legalities are continually being changed and the guide really should have a copyright date of 2006 or later to be reasonably comprehensive.

sarymclary

Hello Hyersal,

I'm so sorry to hear about your friend's death, and realise that you want to try to help your good friend as much as possible at such a difficult time in her life.

Firstly, your friend doesn't need to rush to sort out the financial situation straight away, institutions will wait, and are usually quite happy once they've seen a copy of the Death Certificate to put most things on hold.

It doesn't sound as though there is a great deal of money in the estate, therefore probate won't be needed.

My husband died when my children were all young, and it wasn't expected, however, he hadn't kept up payments on his life insurance, therefore I was in a similar situation to your friend. A big mortgage, and I'd given up work a long time before to raise our family, plus I had the responsibility of caring for the 4 children.

Here are what I suggest your friend does to begin with:

1. Get several copies of the Death Certificate (write a number on the back of each). Keep a record of which Certificate goes out to which company/address. They can very easily get kept in a pile of paperwork by some establishments. I had one returned 5 years after I'd sent it to a company!

2. If your friend's husband had ever paid National Insurance contributions for a period of 6 months in his working life, she could more than likely claim a one-off Bereavement Payment, this was £2,000, and it was what I was able to use to pay for the funeral. If money is going to be very tight, then I suggest your friend tries to keep costs of the funeral to an absolute minimum. I didn't have any funeral cars, as family were able to accommodate us in their cars to the church, and back home again. I had a basic coffin, no fancy linings. I knew my husband would have just said it was pointless paying for it, and he was past bothering now anyway. I just bore in mind how he would have approached the whole thing, and that meant I wasn't making any emotionally charged decisions, that would cost me dearly. I did get them to put an announcement in the local press, which in hindsight I could have done myself, and saved £50 in the process. Even keeping things to a minimum, it was still very close to the £2000 mark.

More info on benefits here: http://www.direct.gov.uk/en/MoneyTaxAndBenefits/BenefitsTaxCreditsAndOtherSupport/Bereaved/DG_10018703

2. Contact the most important establishments, such as the mortgage company, banks by telephone. They will want to see the Death Certificate before they process anything, but it sets the ball rolling. Utilities and other companies can all be contacted by post in the coming weeks. For now, it doesn't matter whether they know or not, and she can concentrate on the funeral, and coping as best she can day to day.

3. The debts her husband had should be wiped upon his death, and again will need to see the Death Certificate. Unless he'd had serious debts, where there were charges against the property for payment to be made, or there were court proceedings for payments, but this doesn't sound the case.

4. Your friend needs to put a claim in immediately for Widowed Parents Allowance, as well as Child Tax Credit. Tied in with that she will invariably be able to claim for Council Tax Benefit, and Housing Benefit (which might pay towards the interest on the mortgage). If she contacts your local benefits office, or do as I did, take all relevant paperwork like the Death Certificate, and a Council Tax statment, and other official paperwork to prove you live at your residence, and something with your National Insurance number on it. Someone sat with me and went through filling out the form there and then (I think I rang beforehand to make an appointment). They copied and signed all my paperwork, so I didn't have to leave it all with them, and then it got sent off to be processed immediately.

If your friend isn't currently working, and has no income, and her savings are modest (under £6k), then she will be eligible to claim benefits. Widowed Parents Allowance is an enhanced form of Income Support.

She can go here: http://www.turn2us.org.uk/benefits_search.aspx
to put in her details of income, etc., to get a calculation of what benefits she's entitled to.

If your friend's husband had ever worked for a business where he paid into a pension scheme, then your friend could possibly be liable to receive a modest widow's pension, and maybe something payable to each of the children. I found a box of old paperwork in the loft about a year after my husband had died, and contacted the company. It led to me getting a monthly payment for the children and I of £150, which I've used over the years to save towards their birthday presents, Christmas and school uniform. It's the only extra income I've ever had to help me out. These are usually payable to the children until they leave full time education, or their 21st birthday (whichever is sooner).

If the insurance isn't going to be paid out, then like me, your friend would be looking at having to sell her house if she is unable to maintain the mortgage. I got a p/t job, but I didn't earn enough to be able to fund nursery fees as well as the mortgage. It took me 3 years to sell the house, which meant the amount payable was increasing, but the housing benefit did help with the interest. The mortgage company were happy that I was actively trying to sell the house, so didn't apply too much pressure, and they never threatened to repossess me, although there was about 50% equity in the property at the time, which helped.

There's an awful lot for your friend to take on board right now. The best advice I can give is to try not to do everything all at once. The financial stuff can all be dealt with in time. I would concentrate on getting through to the funeral, and dealing with that and the emotional side of things now, then once that's out of the way, focus on the practical day to day stuff.

If you need any more help or support, don't hesitate to PM me, or pass my details on to your friend. It's a really tough, isolating time, and people behave strangely to the bereaved. I hope her and his family are being supportive at this awful time, and I'm so sorry for their loss.

Take care, and she's lucky to have a good friend like you at a time like this.

Sarah

CRANKY40

Your friend should not assume that the life insurance won't pay out. A friend of mine was widowed by suicide and after some discussions the insurance paid out. Mental illness is a condition just like any other (my husband died of heart disease) and as such, the insurance cover should stand.

hyersal

Thank you for your comments John-Pierpoint. As soon as she is ready I will get on to the benefits side of things, she has started a bit of it but pretty sure she can claim a little more in the short term. I have some of the which guides on the way too which should be a great help. knowing where to start has been the biggest issue. Yes, thankfully her family is very supportive and aware of her and her childrens emotional needs although there are other issues as another family member (elderly) only died 3 weeks ago so they were all already a little raw.

Thank you CRANKY40. It turns out it was just an assumption on the life cover so will now contact the provider - no harm in trying to discuss a claim but may need to wait a few weeks as raising her hopes coupled with a knock back now maybe too much for her right now.

Thank you for all your brilliant detail Sarymclary (sarah) especially in giving my friend the confidence to go at the speed she is comfortable with. One struggle (among many at the moment as I am sure you understand) is realising that while her world has stopped for everyone else it just keeps moving, sometimes with very little thought to her current situaltion, although saying that she has now found out how brilliant her family is, how many great friends she has and that her childrens schools are prepared to above and beyond what she could have expected.

I expect as things become clearer and we can focus on specific issues (especially around the mortage and maybe having to part with the house) my friend may want to take you up on the offer to contact you.

There is a pension (relating to before she met her husband) but apparently she believes she cannot claim against it. I am going to do a little digging and may be back on here asking for more advice about the pension issue soon.

hyersal

with regards to a pension he was in the army age 15 1/2 for about 3 1/2 years until he was medically discharged after an accident. My friend believes he mentioned a pension but cannot find any paperwork relevant to his time in the army. Any ideas on where to start with this? Other issue is if there was a pension she wont be the named beneficiary as he had left the army before he met her - can only guess it would be his mum.

CRANKY40

If she was married then she is the pension beneficiary automatically, no matter when the pension was paid in to. If the pension is small, she may however receive a one off payment in settlement instead of a regular pension - I had one such payment. I'm thinking that the army would be MOD? My husband was a civilian with the MOD so my pension comes from them. I'm going out in a minute, but I'll PM you a number for their pensions admin later. She'll need his national insurance number.

The life insurance may well be a knock back at first, but you can encourage her not to accept this. My friend was initially told no payment, but they did eventually pay out.