What if probate isn't applied for?

treecol

I seem to be spending all my time asking here for advice re my late mother in laws estate & I apologise for asking more. But I'm dealing with difficult circumstances & it's really hard, so please bear with me. It's bad enough to lose a loved one without all this.
My MIL's will leaves everything to her husband who survived her. A house & a piece of ground she owns jointly with her brother. The total of her estate will be slightly below her £325k allowance & the entire estate upon her husbands death should be below £650k so there will be no IHT. She & her husband are tenants in common on the house, she is tenant in common with her brother on the land. The family don't want to get involved in probate & say they will not apply for it or send off form IHT205. (I've prepared the paperwork but not sent it off). What are the future implications for this?

Tuesday_Tenor

Previous thread here, but we don't seem to be much further forward:
https://forums.moneysavingexpert.com/discussion/5129544

It is hard to tell for sure on the on the basis of the information provided, but it is highly likely that not applying for probate will cause a hugh mess for someone in the future when land ownership needs to be transferred again. At that stage somone will have to go through the process of applying for the probate that should have been done now.

I suggest that because you have already said that the Land Registry have told you that probate is required to transfer ownerships of those parts of the estate that were held as 'tenants in common' with someone else.

Unless:
Has the solicitor explained in clear terms the reasons WHY he is saying to the family that probate is not required. Someone on this forum has suggested that there may be circumstances where if the land is UNregistered it can transfer between family members without probate. Is the solicitor saying something like this? If so, it is very peculiar that he and the Land Registry have such different understandings of the situation.

Is the estate comprised solely of the 'TIC' share of the property and land. Are there no other assets that have required a grant of probate for the executors to access them?

Your husband is one of the executors. If he is still unclear then I would be inclined to seek the opinion of a different solicitor. Prepare ALL the facts and write them down clearly. More clearly than you have on this forum. Everything very specific, no room for ambiguity. Hopefully a different solicitor could then give you an opinion within a free first-half-hour session, or for a minimal fee if it takes a little longer.

If your husband is finally assured that probate IS required and the other executir refuses, then your husband should apply saying that the other named executor refuses to act as executor. If the other exec won't sign the form to either act as exec or to renounce the position, then your husband states this in a covering letter. I think the Probate Office would write to the other person asking him to decide what he is doing. I would think that failure to agree to act as exec when so named in the will would be deemed to be a renunciation, and you husband could proceed as sole executor. The probate office will be very helpful in guiding you through all this.

Good luck. Sounds a very difficult situation.

Savvy_Sue

Who is named as executor(s) in the will?

What assets were there apart from the house and the land? bank accounts - where they in joint names?

Anything else?

As I understand it, if they don't apply for probate now, neither the house nor the land can be sold. So if Dad wants to sell the house, he'll need probate.

If those named as executors don't want to act in that capacity, or are unable to do so, then you could apply for them to be replaced and DIY.

treecol

Things have changed so much in this. Initially we thought my husband was executor, but as it turned out when we finally got the will, my father in law is executor. I have prepared the IHT 205 & probate form. It is the rest of the family who don't want to apply for probate as they don't see the need despite my explanations.
There is only house & land involved.
If they don't do it, which means not sending off IHT205, can the unused £325k transfer to my FIL's estate when he dies?
I know FIL cannot sell the house without it, so it may come to light if a sale goes through, at the last stage.

Land_Registry

I've had a look at the previous thread which Tuesday Tenor has linked to and would make the following comments, which hopefully will help from a registration perspective.

If a registered title is in joint names (whether tenants in common (TIC) or not) and one owner dies then the survivor can deal with or transfer the title. Probate should not be required for the deceased for registration purposes and the only evidence of death we would need would be a death certificate.

Clearly the deceased's share in the property can come into play for those dealing with the property but this aspect is dealt with as part of the 'beneficial' title and not the legal title (property). We deal with the legal and not the beneficial title of course.

Invariably the beneficial title aspects are dealt with away from the register and between the surviving owner and the deceased's beneficiaries (if not the surviving owner).

In such cases probate may have been obtained for reasons other than dealing with the legal title.

The TIC aspect will come into play if the surviving owner seeks to sell Lease or mortgage) the property as 'capital monies' change hands and as such he/she cannot take receipt of these without appointing someone else to act in respect of the deceased's share. There is no registration requirement for that appointee to be the executor/beneficiary but in most cases it will be simply as they have an interest/involvement in what happens next re any monies etc

If the property is unregistered then any transfer of ownership (on sale of by way of a gift) would now trigger first registration.

In this example the property and the piece of land appear to be in joint, but different names. In the former case with the MIL's husband and in the latter with her brother. As such the surviving owners should be able to deal with the property and land with the TIC (if any) aspect acting as a caveat as explained above. Probate should not be required for registration purposes.

I am not aware that this situation changes when dealing with unregistered land.

Naturally I cannot offer any guidance re IHT or any wider implications around probate law and the remainder of her estate as that is outside the registration remit

In the OP's other thread they refer to having rung Land Registry and received what appears to be conflicting advice. Whilst I would hope that this was not the case mistakes can be made. In my experience (and I make mistakes just like anyone else) this can happen where matters are complex, as in this example, involves more than just the registration aspects and where it is discussed over the phone.

I would always recommend putting matters in writing (and that is not a criticism here as these forums are excellent sources of information) simply because they can provide a more complete picture, which can then be checked against any available official records. They also enable the person handling the enquiry to double-check the information provided and what is being asked before they offer a response, which is itself also in writing.

The conflicting advice appears to have suggested that the TIC aspect means that probate is required - that is incorrect from a registration perspective although probate may be obtained for quite separate reasons as explained above.

Probate tends to be required for registration purposes where all owners are deceased.

I hope I have not muddied things for the OP or added to the complexity but if any additional questions arise re the registration requirements (such as how does the husband deal with the TIC aspect if he has inherited MIL's share) then do let me know and I'll do my best to explain.

treecol

Thank you, that clears things up. most helpful.

G6JNS

treecol wrote: »

I seem to be spending all my time asking here for advice re my late mother in laws estate & I apologise for asking more. But I'm dealing with difficult circumstances & it's really hard, so please bear with me. It's bad enough to lose a loved one without all this.
My MIL's will leaves everything to her husband who survived her. A house & a piece of ground she owns jointly with her brother. The total of her estate will be slightly below her £325k allowance & the entire estate upon her husbands death should be below £650k so there will be no IHT. She & her husband are tenants in common on the house, she is tenant in common with her brother on the land. The family don't want to get involved in probate & say they will not apply for it or send off form IHT205. (I've prepared the paperwork but not sent it off). What are the future implications for this?

Who is the executor and what reason have they given for refusing to apply for probate? It is highly unlikely that the property is the only asset in the estate. Do they have some hidden agenda? It all sounds rather suspicious and to be candid downright foolish. Certainly make things difficult for future generations who have to untangle the mess. Whilst I am well aware that bereavement often makes people behave irrationally they do need to get a grip and the sooner they do the better.

treecol

My concern now is what are the issues we are likely to face when my FIL passes away, with regard to IHT?
The family solicitor says HMRC are very likely to investigate as probate isn't being applied for now. Having done the probate & IHT205 forms myself, I know everything is above board, but I can see a big headache ahead!

G6JNS

treecol wrote: »

My concern now is what are the issues we are likely to face when my FIL passes away, with regard to IHT?
The family solicitor says HMRC are very likely to investigate as probate isn't being applied for now. Having done the probate & IHT205 forms myself, I know everything is above board, but I can see a big headache ahead!

HMR&C are likely to investigate and may apply penalties. Unless you give some more information about the background it is difficult to say more than the executor is being very foolish.

treecol

There isn't really more to add. The estate is below IHT, very straight forward & I've filled out the forms, the executor has signed them but just says he doesn't want probate applied for as he can't see the need. So I'm stuck. I think I will ask HMRC direct what will happen in this case. Perhaps something official in writing may encourage him.

Crabapple

It isn't that uncommon for Probate not to be applied for when the first spouse dies. If there is no need for it due to joint assets and no IHT liability then I don't think HMRC will be too concerned.

However, if you need to claim the transferable nil-rate band then you will need figures as accurate as possible to give to HMRC at that point, plus copies of death certificate and Will.

If the Executor persists in not wanting to apply, and there is genuninely no need to as discussed above, I'd just file away what you have and keep it for the future as it has all the financial information that must be provided to HMRC in due course.