Will Trust & IHT205

fcjf

I am completing form IHT205 for my late Mother and have a query around Will Trusts which I am hoping someone can help me with.


When obtaining the original Will from the Solicitors they mentioned that the house in the Will was a Trust House. The clause in the Will states ' I GIVE free of tax to my trustees my beneficial share in the residential property which I own at the date of my death'.


My Dad still lives in the property and the Will states further that he has a beneficial share in the property etc. They set up mirror Wills in 2009.


I have seen a letter from the Solicitors who set up the Will advising that they had advised the Land Registry that the property was no longer owned under Joint Tenancy. I obtained the Title Register and it states the owners as my Mum and Dad but has a restriction that 'No disposition by a sole proprietor of the registered estate under which capital money arises is to be registered unless authorised by an order of the court'.


I don't really understand what this means but if it isn't a Joint Tenancy or Tenants in Common on the IHT205 form does this go down as an asset being held in Trust and the details entered in Box 9.3 (it is valued at £90,000).


In addition do I need to register with the Land registry that myself and my brother (also named as a Trustee) have an interest in the property and does this have to be done by a Solicitor or can we I do it once I have Grant of Representation?


The Will also states that my Mum personal property was given in equal shares to her Trustees (myself and my brother) UPON TRUST. Do these have be entered in Box 9.3 as held in a Trust?

Any advice much appreciated.

Crabapple

The IHT 205 is the picture at the date of death.

None of the assets were in trust at that point, they were just hers, so don't go in any trust sections.

The second bit isn't really a trust as such, it's just holding assets safe until distribution to the beneficiaries has taken place.

Yorkshireman99

Crabapple wrote: »

The IHT 205 is the picture at the date of death.

None of the assets were in trust at that point, they were just hers, so don't go in any trust sections.

The second bit isn't really a trust as such, it's just holding assets safe until distribution to the beneficiaries has taken place.

Regarding registration you only need to do that if you are going to keep the proerty. Otherwise the change can be incorporated when you sell it.

fcjf

Regarding registration you only need to do that if you are going to keep the property. Otherwise the change can be incorporated when you sell it.

So just to confirm, my Mothers share of the property is now owned by myself and my brother, my Dad carries on living at the property and we don't need to notify any changes to the Land registry unless we are keeping the property when my dad passes away?

Yorkshireman99

fcjf wrote: »

So just to confirm, my Mothers share of the property is now owned by myself and my brother, my Dad carries on living at the property and we don't need to notify any changes to the Land registry unless we are keeping the property when my dad passes away?

What you need to remember is that the value at the date the house ceame yours needs to be established so that the base value for CGT purposes is established when you fianlly sell the property. This needs a paid for valuation by a RICS or similar professional.

Crabapple

If this is a life interest trust for the surviving spouse as suggested in the op then there will be CGT uplift on his death.

Only if it is an outright gift to the sons could there be a tax issue later for which they would need a base cost.

cherry76

Crabapple wrote: »

If this is a life interest trust for the surviving spouse as suggested in the op then there will be CGT uplift on his death.

Only if it is an outright gift to the sons could there be a tax issue later for which they would need a base cost.

Do I understand there will be no CGT upon selling if the house was held in a trust.?

Crabapple

If this is a life interest trust then it's treated as owned by the life tenant so no CGT on disposal, unless it's increase in value after date of death. But this does not apply to other types of trust ownership where CGT may be an issue.

loulou41

There will not be any capital gains tax liability on the share of the property held by the Trust since the trustees can claim principal private residence relief as a result of the surviving partner’s right to occupy. Saw this on the internet does this make sense. If the trustees have got their own house how can they claim relief.