inheritance advice needed

grey_gym_sock

cashbackproblems wrote: »

She can put into a portfolio which invests in Business Property Relief assets and after 2yrs that money sits outside her estate and becomes free from the 40% IHT.

er ... we don't know if there is any IHT issue here, but if there is, a deed of variation would get round it. keep it simple!

Primrose

I believe there is a facility called a Deed of variation whereby the beneficiary of a Will can transfer their legacy to another /other people without having receipt of it themselves. Get your motherto check this out with the solicitor. I think it has to be be done within a certain time of the Will being passed for probate though.

holly_hobby

Aegis wrote: »

Simple, but as you pointed out, if the estate plus those gifts would likely equal £325k or more, potentially very inefficient.

I'd suggest that the OP speak with their solicitor about the possibility of drawing up either a Deed of Variation or a Deed of Disclaimer, either of which can be lodged within two years of the date of death to vary the standard distribution of bequests with the consent of those who would otherwise have received them.

This should be possible as long as the mother does not have someone making financial decisions for them in the form of an attorney (attorneys are, from memory, barred from gifting away capital for the purpose of IHT mitigation).

It does sound like this is something the solicitor should have known about and suggested if it were possible though, so I have to wonder why they didn't point this out themselves.

Yes, but we have no idea if there is an IHT issue ??? And if there is any unused spousal nil rate band that may be transferred, on application following Mums death by her administrators, to Mums unused nil rate band - although yes you are correct (and as I stated) that 325K is the probably the minimum nil rate band that we are looking at here.

DOV already discussed and suggested.

Perhaps the OP will return and confirm the purpose of the exercise so relevant advice can be given.

Hope this helps

Holly

carolm56

If my Mum lives in sheltered accommodation and inherits her husband's property via his will but she chooses to get a Deed of Variation as she doesn't want the property, would the state benefits she gets be affected as she never had the property in the first place. Inheritance Tax does not apply as his estate isn't worth anywhere near the £325,000 limit

Mojisola

carolm56 wrote: »

If my Mum lives in sheltered accommodation and inherits her husband's property via his will but she chooses to get a Deed of Variation as she doesn't want the property, would the state benefits she gets be affected as she never had the property in the first place. Inheritance Tax does not apply as his estate isn't worth anywhere near the £325,000 limit

Means tested benefits would be. You can't turn down an inheritance and still live off the tax payer.

xylophone

the state benefits she gets be affected as she never had the property in the first place. Inheritance Tax does not apply as his estate isn't worth anywhere near the £325,000 limit

http://www.death-duties.co.uk/content/variation-will
"Deeds of variation are very effective but caution should be exercised where a named beneficiary is already in receipt of state means-tested benefits as the deed could be seen as a deprivation of income or capital by the benefit provider. This could possibly result in a withdrawal of the benefits. Under these circumstances it is recommended that full disclosure of the facts and prior approval of the benefit provider is sought."

le_loup

carolm56 wrote: »

If my Mum lives in sheltered accommodation and inherits her husband's property via his will but she chooses to get a Deed of Variation as she doesn't want the property, would the state benefits she gets be affected as she never had the property in the first place.

Isn't it amazing, what some people expect the rest of us to pay for just so that they can get some dosh?

carolm56

Just for the record Le Loup if your response is a pop at me. You need to get your facts straight BEFORE you start accusing. I just want to protect my Mum by checking that she would not be penalised should she give the inheritance away. Neither she nor any member of her family wish to 'get some dosh' so don't jump to conclusions!!!!

atush

Le loup may not have been nice, but was correct- if your mother is in receipt of means tested benefits she is already receiving 'dosh' as it were.

It sounds to me she must inherit and lose some benefits, as if she gives it away they can take her benefits anyway?

I know this isn't what you want to hear, but no use getting mad at us for telling you what she wants to do is mostly likely not allowed.

And anyway, you should have started your own thread instead of piggy backing on someone else's as each person's circumstance is different.

le_loup

carolm56 wrote: »

I just want to protect my Mum by checking that she would not be penalised should she give the inheritance away.

Penalised!
PENALISED!
What planet are you living on?
It is the rest of us taxpayers who would be penalised if your mother has money but gives it away to continue on benefits.
Am I popping? You bet.