capital gains tax

charlie2015

hello I wonder if anyone can give me any advice . this is an on going problem . and I have mentioned this before . my father died over three and a half years ago . the executors are withholding about £45,000 from the 5 beneficieries to pay solicitors fees but mostly to pay CGT . they say that there has been no correspondence at all from HMRC in this time . and they have wrote to them a few times . this occurred because they told probate my fathers assets were £554,000 but sold the property for £625,000 they actually sold the property before they went to probate so must have known this was wrong. in my last letter to them I asked as this was going on and on . why could the remaining money not be shared out . and each of us sort out our own tax .out of our own £11,500 tax allowance they did not reply to this question this was 4 months ago. I am about to write to them again asking the same question . is there any reason this solution would not work as they appear to be doing nothing . many thanks for your help

Crabapple

The most obvious reason is that HMRC may not accept this is a CGT situation at all and may insist on payment of the IHT.

If not, the trustee and individual rates of CGT are different.

In any event the executors are liable to pay any tax due. What if they distributed and then a beneficiary refused to pay them back?

I don't think you have any chance of a distribution.

Yorkshireman99

The executors have been very stupid in under declaring the value for probate. They can, and should apply to have the probate value amended along with the IHT calculation. It is their responsibility to chase HMR&C and they will be personally liable for any costs due to their failure to chase HMR&C. You need the give them a formal written complaint. Don't let them mess you about any more.

charlie2015

hello this is not a IHT case it is under the joint threshold .it is a CGT issue . how do you do a formal written complaint. do you need a solicitor?. I am trying to resolve this mess with many thanks

Yorkshireman99

charlie2015 wrote: »

hello this is not a IHT case it is under the joint threshold .it is a CGT issue . how do you do a formal written complaint. do you need a solicitor?. I am trying to resolve this mess with many thanks

If the value was understanted then there shuld be little or no CGT. You can't use your own CGT allowance as any gain is by the estate not the beneficiaries. It is the executor(s) who have to deal with this. Are they individuals or a solicitor?

charlie2015

hi they are husband and wife . the problem is there is a £70,000 difference between the two figures this gives a.CGT of approx. £20,000 which we are all liable for apparently although 4 of us have had no input at all in this .it beggars belief .many thanks

Yorkshireman99

charlie2015 wrote: »

hi they are husband and wife . the problem is there is a £70,000 difference between the two figures this gives a.CGT of approx. £20,000 which we are all liable for apparently although 4 of us have had no input at all in this .it beggars belief .many thanks

The benificiaries have no liability for CGT! The executors should have, and still can have, the probate value amended. It is the executor's responsibility to sort out the mess they have created. You and the other benficaries need to take this up with the executors. Ultimately the executoprs are responsible to the beneficiaries for the loss. Don't let them get away with it.

charlie2015

advice please I wrote to executors over a month ago no reply as yet and to be honest not expecting one. solicitor is hopeless will not reply to any phone calls and only seems to be interested in executors. I guess because they are paying the bill .although we will all be paying the bill. after reading previous thread are executors solely responsible for paying CGT out of their own finances many thanks

Yorkshireman99

charlie2015 wrote: »

advice please I wrote to executors over a month ago no reply as yet and to be honest not expecting one. solicitor is hopeless will not reply to any phone calls and only seems to be interested in executors. I guess because they are paying the bill .although we will all be paying the bill. after reading previous thread are executors solely responsible for paying CGT out of their own finances many thanks

If the xecutors under declared the value for probate it is up to them to negotiate with HMR&C to amend the probate value. That will remove most, if not all, of the CGT liability. The beneficiaries have no CGT liability but unless the executors sort the mess out the estate will. The executors need to be told, in writing, that they will be personally liable for their negligence. Where does the solicitor come in?

charlie2015

from what I understand this could be what is being done but they wont tell 3of us what is going on . this has been going on for 3years 8 months now. they are saying they have not had any reply from HMRC in all this time despite sending reminders to HMRC?. this was about 6 months ago .they now will not reply to emails sent do I need a solicitor to say they are personally responsible for their negligence .the solicitor was dealing with CGT but they then gave the problem to his accountant to sort out about 3 years ago .the last time I spoke to him he told me the CGT was nothing to do with him now.i was just pointing out how hopeless the solicitor seems to be many thanks

Tom99

What was the time gap between date of death and the sale?

If values have risen between those two dates there may be a taxable gain.