Family member in house during probate

pidleynet

Good morning


I'm currently in probate dealing with my mum and dad's estate. I am the sole executor of the wills and the only asset is the house. There is quite a delay in probate as am waiting to get the original copy of both wills as were filed with a solicitor that went bust last year.


Is it OK for a family member to live in the house whilst probate takes place? It is likely this family member will continue to live in the house once all is resolved, and the house will be 'signed over' to them.


The house was rented, but the tenant moves out 10th April and my family member wants to move in straight away.


Thanks for any advice.

Crabapple

Who are the beneficiaries?

If you as sole Executor agree to them living there then that is fine, but it would be usual for them to rent from the Estate and the beneficiaries eventually to get a share of this income. They should also of course pay the utilities etc.

If this person is not the sole beneficiary then you should look into the tax implications of 'signing over' the house to them.

pidleynet

No rent will be charged. It's a bit of a delicate situation, and the house will become theirs when the probate is complete. They will take on all utilities straight away.

pidleynet

Meant to say, myself and my sister are beneficiaries. I am buying her out of her share so the other family member can live there

madbadrob

Crabapple as given you great advice however I agree that until the house is transferred over rent should be charged as your sister is entitled to half of that. You could get her to sign an agreement that she will let this person live there rent free until probate is completed and you buy her out. Remember as well that until the transfer takes place you have a legal requirement to do gas safety checks just like your parents were whilst renting the property.

There will be CGT implications for the proposed owner but this is not really your concern

Rob

getmore4less

Absoulutely no problem doing this(been there done it) if you and sis are happy with the temporary arrangement.

The occupier takes on all the bills council tax insurance etc(just check the insurance is done or do that yourself) which simplifys the estate account.

Forget the have to pay rent etc that just creates a tenancy which you don't want. No need for gas safety if a family member is living in the place.

If the person is not a benificiary and you want to gift them the house then look at your IHT tax situation it may be better to do DOV.

getmore4less

Unlikely to be a CGT issues unless the value rockets between DOD and final handover.

You need to double check any SDLT if the place is worth over £250k and you are buying out 1/2 I think this can be avoided.

Mojisola

getmore4less wrote: »

Absoulutely no problem doing this(been there done it) if you and sis are happy with the temporary arrangement.

The occupier takes on all the bills council tax insurance etc(just check the insurance is done or do that yourself) which simplifys the estate account.

Forget the have to pay rent etc that just creates a tenancy which you don't want. No need for gas safety if a family member is living in the place.

If the person is not a benificiary and you want to gift them the house then look at your IHT tax situation it may be better to do DOV.

Put everything in writing and get everyone affected by the arrangement to sign the agreement.

As executor, you are personally responsible for what happens.

pidleynet

Thanks for all the replies. The house is only worth £155k so I guess Stamp Duty at 1% will be payable. I don't think the value will change from start to end of probate so no CGT to pay I believe.


As a sale is not actually taking place, how would we calculate how much Stamp Duty to pay? Would this be based on a valuation?

madbadrob

getmore4less wrote: »

Unlikely to be a CGT issues unless the value rockets between DOD and final handover.

You need to double check any SDLT if the place is worth over £250k and you are buying out 1/2 I think this can be avoided.

I thought I knew most of the acronyms we use on here but what is SDLT

Rob

dzug1

Stamp Duty Land Tax - to give it its full name