What to do?

Severndroog

An inheritance received several years ago was to be split equally between several siblings. One sibling is, to say the least, a bit odd, has no bank account and tries to live under the radar. As he is resident abroad, giving him the money in used oncers is not possible. He has verbally refused the money, but not in writing or in a legally proveable way.

The executor has distributed the remainder of the estate but is left holding this portion of the money. Executor fears it looks as though she has acted fraudulently. Should executor predecease sibling, the money will presumably be counted as part of her estate and will attract IHT at 40%. Sibling refuses to answer questions about a will. Both he and his wife are in poor health. there are no children of the marriage, so if she predeceases her husband without a will there will be no legal claimant on the estate (though there is a relative of the wife's who would have a moral claim). But payment to him would surely count as a gift and therefore still potentially attract IHT?

The remaining siblings have no need of this money. What should the executor do?

getmore4less

Executor holds the money as a trustee, not part of their estate.

Just sit on it.

The only other thing to check is what happens to the trust when the executor dies,

It might be that their executor takes over would have to check on the rules it is a while since I looked at them

the other bit about will and ill heath no legal claimants no idea which people you are talking about.

Look up the rules on intesty they can reach quite a few relatives before there is no one and the estate falls to the state.

Mojisola

Severndroog wrote: »

The executor has distributed the remainder of the estate but is left holding this portion of the money. Executor fears it looks as though she has acted fraudulently. Should executor predecease sibling, the money will presumably be counted as part of her estate and will attract IHT at 40%.

Not if the money is in an executor's account. She hasn't got someone else's inheritance in her own account, has she?

Sibling refuses to answer questions about a will. Both he and his wife are in poor health. there are no children of the marriage, so if she predeceases her husband without a will there will be no legal claimant on the estate (though there is a relative of the wife's who would have a moral claim). But payment to him would surely count as a gift and therefore still potentially attract IHT?

The money belongs to the beneficiary. If he dies, the money is part of his estate. It can be paid to his beneficiary.

The remaining siblings have no need of this money. What should the executor do?

Keep the inheritance in the executor's account. Keep records of every occasion that contact was made with the beneficiary to attempt to give them their money.

pmlindyloo

it seems that if the executor keeps the money in the executor's account then on her death it will be counted towards part of her estate and attract IHT.

Personally I would suggest that the executor needs to get some legal advice about this.

Uncooperative beneficiaries must be fairly common place and I am sure there must be some kind of procedure to be followed in cases like this.

Severndroog

Thanks that is helpful.

To clarify, the sibling concerned, let's call him X, has a wife but is childless. They own a house which is in disrepair but occupies a potentially valuable development site. If he dies without a will, Mrs X will presumably inherit. Great, except that she won't take the money either. At least the descent to her next blood relative would be clear, so at her death, it could all be cleared up.

But if Mrs X dies first without a will life will get more complicated. We think that the intestacy rules of his adopted country would mean his estate goes to the remaining siblings, who would presumably inherit the house as well as this (substantial) sum of undistributed money. They would have to make all the arrangements in person or by delegation for winding up the estate. This would be a daunting task. X and his wife live frugally and in dire poverty - by choice. You simply can't believe that anyone living like that would turn down money and the chance to live in comfort! We suspect there are hidden pots of money and that they may be benefit fraudsters. There has to be mental health issues at play. Sorting out the estate would be a nightmare.

Yorkshireman99

Severndroog wrote: »

Thanks that is helpful.

To clarify, the sibling concerned, let's call him X, has a wife but is childless. They own a house which is in disrepair but occupies a potentially valuable development site. If he dies without a will, Mrs X will presumably inherit. Great, except that she won't take the money either. At least the descent to her next blood relative would be clear, so at her death, it could all be cleared up.

But if Mrs X dies first without a will life will get more complicated. We think that the intestacy rules of his adopted country would mean his estate goes to the remaining siblings, who would presumably inherit the house as well as this (substantial) sum of undistributed money. They would have to make all the arrangements in person or by delegation for winding up the estate. This would be a daunting task. X and his wife live frugally and in dire poverty - by choice. You simply can't believe that anyone living like that would turn down money and the chance to live in comfort! We suspect there are hidden pots of money and that they may be benefit fraudsters. There has to be mental health issues at play. Sorting out the estate would be a nightmare.

The executor should open a trust account and make sure their executors know about it and have all the documentation. Perhaps the beneficiary could nominate a charity of his choice and do a deed of variation.

Mojisola

Severndroog wrote: »

He has verbally refused the money, but not in writing or in a legally proveable way.

Getting him to sign that he refuses the inheritance would be the most straightforward way to sort things out - could someone go and see him face-to-face and get a signature from him?

Keep_pedalling

Yorkshireman99 wrote: »

The executor should open a trust account and make sure the their executors know about it and have all the documentation. Perhaps the beneficiary could nominate a charity of his choice and do a deed of variation.

Sounds like too much time has passed to do a DoV, which must be done within 2 years. He could still instruct the executor to give the money away, although it would still form part of his estate for the next 7 years if he died back in the UK.

Keep_pedalling

Just a thought, but if this pair of idiots continue to refuse the money and fail to provide instructions on what to do with it, could not the executor wash their hands of it by setting up a trust controlled by independent trustees?

wwl

I wonder if the cost of the executor going out to visit the person to get them to either accept or formally refuse it (on video if they won't sign it) would be a legitimate estate expense. Might be the easiect option considering the situation.

Severndroog

Face to face hasn't worked. They think anything official will instantly alert the government and result in the withdrawal of benefits. There's nothing rational about this thinking, since they obviously wouldn't need benefits if they accepted the money (and I would not be at all surprised to find out that there is a huge cache of money under the proverbial mattress).

Also I suspect that when we ask about wills they think we are after their money even though we have explained that we just want to sort it all out. It's like it's them against the world. I'm not sure they even know that they live in squalor.

They are both in very poor health. I don't think either of them will last a lot longer.