Missing money...?!?

Miss_Merlot

Hi all,

Hope someone can help me out with the below...

My grandma sadly died in January and the probate process was initiated early February, with the solicitor guesstimating a one month turnaround (which I immediately counted on tripling - in my experience things like these never move that quickly!).

The total estate was worth about £150k, and divided equally between siblings - no tricky disputes or anything to slow things down.

My dad was left £20k, £10k of which he is passing on to me as soon as it comes through. This money would make the difference to us between a 15% and 20% mortgage, and we are really counting on it coming through by the end of July...

But here we are five months on in June and still nothing - we have recently been informed that it is with HMRC to process a rebate and then it will be paid out.

Unfortunately my dad is not a - what's the word? - appointed administrator of the will, so we are reliant on second hand information from aunts and uncles here.

Does anyone please have any advice on timeframes we can expect here, given that we are already 5 months in and getting increasingly antsy about it...?

troubleinparadise

Sadly I think you were misinformed re the timescale for distribution of an estate after death - 2 months to payout is really almost unbelievably quick, unless it was a very uncomplicated estate not involving probate....

I was warned by a solicitor not to make any plans for the money until it was in my hands - such as a house purchase - and we're on the 18 months mark now with no date for the final reconciliation - but it is a complicated estate!

Can you not, via Dad as the direct beneficiary, approach the Solicitor to find out where things are in the timescale? It wouldn't be unreasonable for him to ask the solicitor himself, I feel.

Miss_Merlot

I thought as much re misinformation, which is why I allowed far more time than stated - obviously not enough And it is really not a complicated estate!

According to my dad he's not able to approach the solicitor directly (only nag aunts and uncles to do so), but will ask again - thank you!

Chrissie72

Can't add any more to what TIP said... Good luck x

Miss_Merlot

Thanks both - just wondered if anyone had experience of general HMRC rebate turnaround times, as that seems to be the main sticking point atm...?

RAS

Could dad ask for an interim payment?

We did this when one of our beneficiaries stopped general bleating about "when is it coming, hurry up" and explained that they needed the money to pay a specific bill or would have to take a loan out.

Miss_Merlot

Good idea! Don't ask don't get

RAS wrote: »

Could dad ask for an interim payment?

We did this when one of our beneficiaries stopped general bleating about "when is it coming, hurry up" and explained that they needed the money to pay a specific bill or would have to take a loan out.

John_Pierpoint

Your dad has been given a specific bequest.
When he has still not had it in 12 months time, he can demand that interest is added to the bequest.
The solicitor was almost certainly lying when he said 30 days just to get the business, like an estate agent flattering a potential customer by over valuing their "beautiful" house.
A more realistic HMRC starts charging interest on unpaid IHT after 6 months, in spite of its procedures often being the cause of the delay. Presumably there isn't any capital tax to pay on this estate; though there could be some disagreement over the valuation of real estate?

The notice in the London Gazette has to offer 2 months for claimants to come forward, so allowing for printing dates and gathering in any claims that is three months.

Persons wanting to challenge the situation under the 1975 act have 6 months from probate in which to enter their claims.
If your father has a desperate need for funds, for example to stave off bankruptcy, then were I the executor, I would be sympathetic and try to make an interim payment, however he has no rights in this matter yet and were he just being impatient, I would point out that his behaviour is increasing the costs for everyone else and tell him to go forth and multiply.

Asking for a guestimate for when probate might be granted is acceptable, but it would be just a guestimate. For the last estate on which I was an executor, after agreeing the values with HMRC and paying the IHT, I ran into another black hole in that it took the central London probate 6 weeks to acknowledge the receipt of the will and offer me a date to swear it. It then took another 2 weeks for the grant of probate to arrive.

A solicitor taking more than 6 - 12 months is making the problem more complex because the trust he is administering will have income coming in that needs to be reported, taxed and distributed to each beneficiary.

zzzLazyDaisy

My sister and I did our mum's will ourselves (small estate, no property, no tax issues, but had to go to probate). It still took over a year to call all the money in and distribute it, mainly due to one particular bank losing the papers.... three times.

This is quite a useful article about dealing with a will - note the time scales towards the end

http://www.stoneking.co.uk/literature/info-sheets/probate-guide

One thing to be aware of is that if the executors distribute the estate too early, they can be personally liable if creditors later crawl out of the woodwork, so two months was never going to happen!

John_Pierpoint

The best simple summary I have read.

I have "survived" as "PR" on 5 estates but I don't understand this information:
5. If a trust applies to the estate after the death, PRs should be very cautious if intending to make distributions from it within three months after the death there may be adverse tax consequences. Technical advice should be taken on the tax consequences of any distribution from such a trust.
Any one care to comment on what the LLP is getting at ?

The 80:20 rule definitely applies to the distribution of the latest of my family's 5 estates: In my case HMRC and Barclays Bank were the 2 causing 80% of the delays.There is a whole thread, on the MSE forum somewhere, criticising Barclays attempt to hive off its "Bereavement Dept," to an outside organisation trying to profit from the situation.

purple_haze

It's known as the Frankland trap. S144 IHTA allows appointments from a trust in a will within two years of death to be treated as a gift by the testator for IHT purposes, but only if the appointment would attract an exit charge.

Since appointments within three months of a trust's creation do not attract an exit charge, s144 can't apply so there can be adverse IHT consequences.