joint account/rights on death

juney59

Hi everyone, this is my first time posting on here but really do need help.
Several months ago my mum sold her house and moved in with me so that I could care for her and support her (She is 84).
After the sale of the house she gave money to all of her children rather than when something happens to her as her old will dealt with her house and the proceeds which no longer exists.
She informed all of my siblings that the will was now void and they had all received their share of her house and would receive nothing more on her death .
As I am the only one of her children that has always been constantly there for her and my father before he passed away, she has expressly said that any money left in her bank account should go to me and no-one else.
She does not want to make another will as she feels that it is a waste of money. She wants to add my name to her bank account as a joint account holder and state in the mandate that we are both to operate the account so that in the event of her death the money in the account becomes mine automatically. Is she correct that this would be the case if I was the joint account holder and what would happen when mum passes.:question:

agrinnall

It probably would be OK but for the sake of a few pounds to make a Will I would do that and make certain.

Of more immediate concern should be the potential for deprivation of assets should your mum need more care than you can provide and have to go into residential care. Perhaps you and your mum could book an appointment together at Citizen's Advice to get information on this.

silvasnow

In terms of the account if you're mother passed away the account would transfer into you're own name once the probate and bereavement procedure was completed

xylophone

In terms of the account if you're mother passed away the account would transfer into you're own name once the probate and bereavement procedure was completed

With a joint account, the control of the account will normally pass immediately to the joint account holder.

https://www.gov.uk/wills-probate-inheritance/property-and-bank-accounts

However, where the whole of the money in the account has been provided by one party, it can be included in the deceased's estate on death for IHT purposes.

See https://www.gov.uk/wills-probate-inheritance/property-and-bank-accounts

The money in a joint account cannot normally be left by will.

http://www.boodlehatfield.com/the-firm/articles/joint-accounts-whose-money-is-it/

I remember a very long running thread on another forum where a widow with her own child and step children ( her late husband's) put all the cash remaining after her husband's death into joint accounts with their own child.

The bank pointed out that the accounts were joint and several, that her son would have full access while she was living and would fall into her son's ownership after her death and she expressed herself as quite content with this.

Her will left the residue of her estate to be shared between the siblings but of course the cash was in the joint accounts.

There was then a long running case with caveats before probate etc and I think a court case followed...I don't know how matters were finally resolved.

With regard to the situation of the OP's mother, she should be aware that if her mother should require care, there could be a question of deprivation of assets.

http://www.ageuk.org.uk/home-and-care/care-homes/deprivation-of-assets-in-the-means-test-for-care-home-provision/

It would be better if the mother kept her money in her own account and left a will?

mt99

as an aside - and you probably know this already - if your mum dies within 7 years then your siblings will have to pay inheritance tax on the money they received (if the total estate value is over the iht limit). Allso as previously mentioned if your mum has to go.into a home then the money might need to be repaid to fund local authority care costs.

Keep_pedalling

mt99 wrote: »

as an aside - and you probably know this already - if your mum dies within 7 years then your siblings will have to pay inheritance tax on the money they received (if the total estate value is over the iht limit). Allso as previously mentioned if your mum has to go.into a home then the money might need to be repaid to fund local authority care costs.

No, that is not correct. For a start the OPs mother's estate ineeds to be over nil rate band, which if she is a widow will be up to £650,000, fir any IHT to apply, and if that is the case then it come out of the of the assets she has not given away. The only comeback on gifts is if there is insufficient money left in the estate to pay the tax bill.

I strongly recomend that she indeed does sort out a new will via a solicitor. If she dies intestate her sibling can challenge the set up, and make a claim on that money. The other issue is what happens if the OP dies first? That unlikely but not impossible situation needs to be covered in the will.

While she is at it she should set up a lasting power of attorney, so that should she lose capacity to manage her own affairs her child can take over.

alanq

Do you have Power Of Attorney? Is the joint account an attempt to allow you to manage Mum's funds without a need for one? I believe that there may be issues continuing to operate a joint account if Mum loses capacity with or without a PoA. With a PoA it would still be possible to manage separate accounts solely in Mum's name.

Something formal would be needed to revoke the old will not just "expressly" saying something. I think that drawing up a new will would be the best solution. Even with professional advice it needn't be too expensive to draw up a simple will revoking the old will and leaving everything to you. I suspect the will would also need to mention that others had already received something prior to death as otherwise the will could be challenged.

System

If any relatives might be unhappy with the setup then a new will is definitely the way to go.

pinkdalek

Consider the consequences of having a joint account with your mum. It immediately becomes your asset to, which would affect any benefits you are currently in receipt of and also if you yourself needed to go into any form of care.

Your mum makes a new will. She appoints you as her attorney to act on her finances whilst alive and appoints you as her executor and beneficiary.

mt99

Well I stand by what I said about inheritance tax obviously it depends on the value of a house she sold but let's say her house was 1.5 million and she gave her children a total of 1300k then on her death could be a big inheritance tax bill to pay and she might not have that amount of money in her bank account left . of course if the house was only worth 150k then none of this would apply I don't know the figures but it is worth thinking about if the house was valuable

juney59

The house sold for way below the threshold. It was only £86,000 and after everything was sorted out only £21,000 remains.