Life Interest

syorkshirelass

Hi
Nearly 5 years ago, my Mum died. She was the sole owner of her house.
My brother and I are the executors and beneficiaries of the property.
We were granted Probate a few weeks after she had died and sorted out her affairs.
There was no mortgage on the property and the value was £180000 approx so under the inheritance tax threshold.

It has been a very distressing time which I have gone into further detail in some previous posts on this forum.

My Mum left a life interest to her husband. The house is in trust until he either remarries or dies. For all the problems, we have acted on our late mothers wishes. The house does not give any monetary interest. He lives there rent free but after some initial problems, now pays the bills and insures the property. He also has to maintain the property. There appears to be differing advice re this and to who should pay....as the capital benefits us then we should be responsible for larger maintenance i.e. if it needed a new roof. Hopefully this won't happen. That is perhaps a grey area in how the will was written.
Thanks for reading so far...
My Mums husband appears to be getting frailer.
We did not transfer the property with Land Registry. It is still in Mums name.
My brother and I wish to sell once my mums husband is no longer here.
I have read that the solicitor dealing with the sale could do all the work using our paperwork...Grant of Probate, The will and the house deeds.
Can somebody confirm as I am perhaps worrying unnecessarily.?
I also need to check out where we stand with Capital Gains tax on the sale?
The will says that the house is a specific legacy and free from Capital transfer.
I keep reading but appear to have some niggling feeling that things haven't been done right.
Any advice will be appreciated. I shall be relieved when we are able to sort out our Mums belongings which we haven't been able to do yet and at some point need to know exactly what to do when the life interest ends.
My brother and I are Tenants in common according to the will. We are close so will not have any problems when splitting the proceeds.

Thanks

g6jns_2

syorkshirelass wrote: »

Hi
Nearly 5 years ago, my Mum died. She was the sole owner of her house.
My brother and I are the executors and beneficiaries of the property.
We were granted Probate a few weeks after she had died and sorted out her affairs.
There was no mortgage on the property and the value was £180000 approx so under the inheritance tax threshold.

It has been a very distressing time which I have gone into further detail in some previous posts on this forum.

My Mum left a life interest to her husband. The house is in trust until he either remarries or dies. For all the problems, we have acted on our late mothers wishes. The house does not give any monetary interest. He lives there rent free but after some initial problems, now pays the bills and insures the property. He also has to maintain the property. There appears to be differing advice re this and to who should pay....as the capital benefits us then we should be responsible for larger maintenance i.e. if it needed a new roof. Hopefully this won't happen. That is perhaps a grey area in how the will was written.
Thanks for reading so far...
My Mums husband appears to be getting frailer.
We did not transfer the property with Land Registry. It is still in Mums name.
My brother and I wish to sell once my mums husband is no longer here.
I have read that the solicitor dealing with the sale could do all the work using our paperwork...Grant of Probate, The will and the house deeds.
Can somebody confirm as I am perhaps worrying unnecessarily.?
I also need to check out where we stand with Capital Gains tax on the sale?
The will says that the house is a specific legacy and free from Capital transfer.
I keep reading but appear to have some niggling feeling that things haven't been done right.
Any advice will be appreciated. I shall be relieved when we are able to sort out our Mums belongings which we haven't been able to do yet and at some point need to know exactly what to do when the life interest ends.
My brother and I are Tenants in common according to the will. We are close so will not have any problems when splitting the proceeds.

Thanks

You need to check the will. Normally a will specifies if a legacy is to be free of inheritance tax not CGT. CGT only applies to property when the owner is alive. Some CGT will be payable when the house is sold but that can be paid from the proceeds. Without seeing the will it is impossible to answer the question of liability for the repairs. Having said that since it is in your, and your brothers interest that the property is kept in good repair. At the start you say you have probate but then ask about the solicitor dealing with it when the house is sold. Do you mean dealing with theLand Registry?

Crabapple

Depending on the age of the Will it might refer to Capital Transfer Tax which was a precursor of IHT.

I would take some advice on whether the house should be transferred into your joint names as Trustees rather than leaving it in your late mother's name, and also on any CGT liability that might arise. That way you won't get any surprises when you are in a position to sell.

getmore4less

Take advice the life interest may negate the CGT issue as PRR may be available.

Don't know the details on this but it has come up before and there was PRR releaf in at least one of those cases.


For others, it is important that the maintenance issue is covered in your wills where you leave a life interest.