Mum passed intestate, need to change name on house

skizz_b

Thank you for your advice guys, I will speak with the solicitor to confirm and keep you updated. :beer:

RAS

skizz_b wrote: »

Thirdly, he does not have any children.

If he dies intestate then his siblings or parents or even his distant cousins get his share.

getmore4less

skizz_b wrote: »

No problem, I'm sure the solicitor will be aware but will ensure this is checked.

So the essence is, if at any stage the house is transferred into the name of myself and my brother, we owe inheritance tax on it? Even in the future?

It can be done without IHT


Spouse in iherits £250k + 1/2(£100k) lifetime, 1/2(£100k) belongs to the kids.

NO IHT.

Spouse now has £325 nillrate band + the % uplift by the unused nill rate band of mum.

More than enough to cover the value of the house so unlikely that alone would cause IHT in the future unless it goes up a lot.

Now it depends what you guys want to happen to the haouse and the spouse, do thye have a lifitime interest, do they gift it to you now, does it gt sold etc

It gets a bit complictaed with the future CGT,IHT issues depending what is done next but it should be possible to avoid IHT.

skizz_b

getmore4less wrote: »

It can be done without IHT


Spouse in iherits £250k + 1/2(£100k) lifetime, 1/2(£100k) belongs to the kids.

NO IHT.

Spouse now has £325 nillrate band + the % uplift by the unused nill rate band of mum.

More than enough to cover the value of the house so unlikely that alone would cause IHT in the future unless it goes up a lot.

Now it depends what you guys want to happen to the haouse and the spouse, do thye have a lifitime interest, do they gift it to you now, does it gt sold etc

It gets a bit complictaed with the future CGT,IHT issues depending what is done next but it should be possible to avoid IHT.

solicitor best to discuss this with, or an accountant? :rotfl:

madbadrob

Without wanting to inflame you I am going to put this in a way that is not meant to be anything but as the law stands.

Has your mum passed intestate then as you know everything goes to her widdower (your step dad) Under the law it doesnt matter what your mum wished when alive it is now his to do with has he pleases. Well with his £250k ad 100k life interest. This leaves 100k that passes to you and your brother immediately. Upon his death and if he dies without leaving a will then the 100k would pass to you and your brother the rest of the value of the house would pass to his issue (which you say he doesn't have) his parents (if they survive him),his grandparents (if they survive him) his siblings or their children if the parents have died. There is no legal requirement for him to place this property in your names whatsoever.

Now if he loved your mother like we assume he did and he is aware of what she would have done had she left a will then morally I am sure he would do this.

The question I would ask is whether he could sell the house in these circumstances and purchase another without yours and your brothers agreement should he not change the house into your name. What about if he decides to put the house into one of these companies who liquidate funds. Remember he is entitled to the interest from the life share also so on his death if the house was to sell for 600k then after IHT is paid and your 100k share is paid the remainder would be there to do as per his will or laws of intestacy. Therefore even changing the house into your names you would end up paying a large amount of money out to his estate on his death. Working with todays interest rates of .5% that would equate to £500 per year. Yet something else for you to discuss with your solicitor

Rob

skizz_b

Not inflaming at all, these are all things that need to be considered, thank you for presenting them in a well thought out manner. It's a legal minefield in many ways, we will just have to wait and see what happens!

NAR

skizz_b wrote: »

Not inflaming at all, these are all things that need to be considered, thank you for presenting them in a well thought out manner. It's a legal minefield in many ways, we will just have to wait and see what happens!

What an interesting scenario to read about. I think you need to get the solicitor to explain things to step-dad, perhaps advising him he needs to make a will. Unless of course you feel you can discuss it with him without causing him upset or worse resentment.

skizz_b

NAR wrote: »

What an interesting scenario to read about. I think you need to get the solicitor to explain things to step-dad, perhaps advising him he needs to make a will. Unless of course you feel you can discuss it with him without causing him upset or worse resentment.

I'm sure I will be able to. This was all about getting a little more understanding about the laws around this situation, I seem to have that now, so we will see what happens.

MotownFox

MotownFox wrote: »

In simple terms
IF Estate is just the House worth £450k
Spouse gets £250k + life interest in £100k of it
Children get £100k + £100k when Stepfather dies
If you can wait do a deal with stepfather that he gets ALL the house as a Life Interest via a Deed of Variation and on his death then the estate goes to your mothers children with perhaps some to his family.

I would try and interest your step father in my earlier suggestion of a Deed of Variation, giving him a full life interest in the property, particularly if he wants to stay in the house and you are happy for him to do so (which you already have said you are)

As he has no family to lose out you are not going to get problems from that quarter. Also if say he had to go into care at a later date the house would not be his so would not therefore have to be sold to pay for such care.

Unless the property value shoots up there will be no IHT as there are very few assets in his name you mentioned. So on his death the property can then be sold and the proceeds split after expenses between whoever is entitled then (you and your brother at the moment)

Of course all parties you, your brother and your step dad would have to agree to such an arrangement taking place and as such will have to sign the deed which the Solicitor will prepare, at a nice price no doubt.

Fire_Fox

It's not as simple as him just refusing to inherit, if he has no assets how is he supporting himself now and in the future? Google deprivation of assets. Sorry to be harsh but your mother should have prepared a will the second she was diagnosed and preferably prior to that, she has left a right mess.