Father terminally ill - his will is causing problems

Legacy_user

Dear all,

My father is terminally ill, its a very difficult time and there is a lot of upset for all his family and friends. The upsets are multifold and he is getting very poorly now, so its getting worst and worse by the day. One of the issues is his will which I'd like some tax advice on if possible

His estate is roughly as follows:

£350k home (although he thinks its worth £500k)
£175k flat with family member living in it
£200k approx of stocks / cash etc

totals: £725k

He thinks it will earn around £230k tax but he thinks the whole estate is worth around £930k whereas I think £725k is more realistic

His will is as follows:

Dad's ex partner - named amount of £200k
Friends and brother - named amount of £15k
My brother and I will receive the rest of the estate

However, the flat worth £175k will probably show as the family member can stay there as our tenant for the rest of their life

If anyone could help me work out what the tax will be on this I would be very grateful.

My fear is this...his ex partner will get £200k and pay no tax so the tax bill will fall to my brother and I.

If this happens, my brother and I estimate we will get £65-£70k each, plus share the ownership of the flat. His ex partner will get £200k cash. Will we also have to pay tax on selling the 2 properties?

Any advice gratefully appreciated.

Treevo

Why will she pay no inheritance tax on her £200,000? Is it written in the will that the tax bill should come from the remainder of the estate?

zzzLazyDaisy

For goodness sake, can't you let the poor man live out the rest of his life in peace? He must have taken advice when he drew up his will, so those are his wishes. What are you going to do when you get your answers? Bully him into changing his will?

System

Treevo wrote: »

Why will she pay no inheritance tax on her £200,000? Is it written in the will that the tax bill should come from the remainder of the estate?

Re: the second question, I dont know but I'm under the impression that is how its usually done. I havent sought any advice but my brother has to that effect and I am wondering if that is the case. Dad told my brother he would show him the will when its complete but I dont think we should look at it. I am seeking answers to calm a situationd down.

System

zzzLazyDaisy wrote: »

For goodness sake, can't you let the poor man live out the rest of his life in peace? He must have taken advice when he drew up his will, so those are his wishes. What are you going to do when you get your answers? Bully him into changing his will?

My dad is a solicitor, he knows what he is doing. You have no idea where I am coming from and under what circumstances I am asking these questions. Quite frankly, I have no space in my head right now for thoughtlessness, so if you don't mind, I won't respond to you again.

Mojisola

MagicCarpet wrote: »

His will is as follows:

Dad's ex partner - named amount of £200k
Friends and brother - named amount of £15k
My brother and I will receive the rest of the estate

My fear is this...his ex partner will get £200k and pay no tax so the tax bill will fall to my brother and I.

That's the way it's usually done. Specific gifts are handed out and the IHT is paid from the residue. It's only if the residue isn't enough to pay the tax that the gifts would be affected.

It sounds as if your father assumed you would be left with much more because he thought the whole estate was worth more than it actually is.

If he's very poorly, do you really want to talk to him about changing his will? Depending on the medication he's on or his health in general, he may not be considered competent to change it. Opening up the possibility of a new will being challenged by his ex would be an expensive exercise.

Tiddlywinks

MagicCarpet wrote: »

My dad is a solicitor, he knows what he is doing. You have no idea where I am coming from and under what circumstances I am asking these questions. Quite frankly, I have no space in my head right now for thoughtlessness, so if you don't mind, I won't respond to you again.

If he is a solicitor then the will *should* have been drawn up with tax efficiency in mind. Could any of his colleagues give their advice? If not, engage a solicitor to help.

Having cared for a terminally ill mum, I can only offer my opinion... time is precious and shorter than you can ever imagine... please spend that time making the most of your time with your father... you will never get a second chance to do the right thing.

Everything else can be sorted out later.

Treevo

If you're day's a solicitor then it'd be very unusual for him to do something legally speaking without realising it. They are his wishes so you should respect them.

System

Mojisola wrote: »

That's the way it's usually done. Specific gifts are handed out and the IHT is paid from the residue. It's only if the residue isn't enough to pay the tax that the gifts would be affected.

It sounds as if your father assumed you would be left with much more because he thought the whole estate was worth more than it actually is.

If he's very poorly, do you really want to talk to him about changing his will? Depending on the medication he's on or his health in general, he may not be considered competent to change it. Opening up the possibility of a new will being challenged by his ex would be an expensive exercise.

Thanks for the advice. I won't be speaking to him, there has been too much about it already but as he is a solicitor he has instigated most of the conversations.

He is competent at the moment, his ex won't challenge, i know He understands the implications. as you say, where its gone wrong is the house valuation. There is so much involved here that's its too much to post so thanks for the tax advice. Unfortunately no one can give me answers on the rest of this horrible and heartbreaking situation

System

Treevo wrote: »

They are his wishes so you should respect them.

Where have I said that I don't respect his wishes?

fluffymuffy

Sounds like your father's a clever person, able to cope with the facts. Just tell him his estate isn't worth what he thought, and is he aware of the effect of tax. My father was having business meetings during his final hours in a hospital bed. That's who he was. Someone who until the last made every effort to see his family was left in a strong position.