Solvent but illiquid estate

unforeseen

TW1234 wrote: »

Is there any reason why the £K 150 could not be merely a promissory note, that would ultimately be from spouse to child and settled when convenient or at death of spouse?

The effect may be from spouse to child but it is really:-
Spouse owes estate £150k. The spouse is buying 75% of the 50% off the estate to allow the estate to pay the child.
Estate owes child £150k


Whether child is happy with promissory note is a question of my they can answer.
Would you also not be stuck other probate that can't be finalised and closed because the beneficiary has not received their legacy. I don't think a promissory note from third party would be seen as fulfilling the requirements of the will.

getmore4less

The £100k residential allowance has not kicked in yet!

is it not better to let that carry over at 100%

getmore4less

From your first post there was no IHT to pay.

TW1234

unforeseen wrote: »

Whether child is happy with promissory note is a question of my they can answer.
Would you also not be stuck other probate that can't be finalised and closed because the beneficiary has not received their legacy. I don't think a promissory note from third party would be seen as fulfilling the requirements of the will.

All parties would be satisfied, if it is permissible. There would no other probate matters to finalise.

TW1234

getmore4less wrote: »

The £100k residential allowance has not kicked in yet!

is it not better to let that carry over at 100%

Correct but only 3 weeks to survive! I thought that the residential allowance HAD to be utilized first if applicable when property was involved, before the normal nil rate allowance could be applied.

Yorkshireman99

TW1234 wrote: »

Correct but only 3 weeks to survive! I thought that the residential allowance HAD to be utilized first if applicable when property was involved, before the normal nil rate allowance could be applied.

Once again nobody can sensibly rely only on advice from here. The advice is well meant and may be correct but without full sight of all the documents nobody can be sure. The executors really should spend a few hundred pounds getting a professional opinion. Apart from anything else it will give some fallback if things go wrong. The executors would be negligent if they don't get professional advice and could end up personally liable.

getmore4less

7 weeks...

What is the goal here?

it won't save any IHT from the simple transfer it all to spouse and spouse gift £325k

with the RNRB it makes things worse.

TW1234

Thanks to both.
Yorkshireman is correct.
It looks as though a new will may be advisable, as the scenario was based on the outcome that would currently arise from one made before IHT nil rates exemptions were transferable and when the estate assets were allocated differently.

TW1234

getmore4less wrote: »

7 weeks...

What is the goal here?

it won't save any IHT from the simple transfer it all to spouse and spouse gift £325k

with the RNRB it makes things worse.

But could possibly avoid future deprivation of benefits concerns if passed to spouse

getmore4less

TW1234 wrote: »

But could possibly avoid future deprivation of benefits concerns if passed to spouse

I would say low risk as there is a clear IHT reason for depleting the assets at that point and there is plenty left to justify this is not deprivation for other reasons.

Counted at least £725k and you implied there is more.