Solicitor's letter 7 months after Probate / Estate closed and finalised

Keep_pedalling

Although you found this out late, you should have adjusted the estate accounts to take everything related to house out, its those small details the solicitors, or your sister, have picked up on.

childofbaahl

So what would you suggest? Do as Margot says and bide my time, see what they say next? Seeing as how She's signed off on the estate accounts, literally signed a document stating she accepts it as final, settled and that she has no further interest in the estate.

Keep_pedalling

childofbaahl wrote: »

So what would you suggest? Do as Margot says and bide my time, see what they say next? Seeing as how She's signed off on the estate accounts, literally signed a document stating she accepts it as final, settled and that she has no further interest in the estate.

There is no actual requirement for a beneficiary to sign off the final acccounts, but even if they do sign such a document it does not prevent them going back to the executor if they subsequently find errors in the accounts.

There clearly is a problem with these accounts as you have claimed expenses that should not have been claimed which has reduced the amount she should have received, and on this point at least you need to respond to the questions you have been asked. As a minimum I would rework the accounts with these expenses stripped out, and pay out any additional amount due.

As no one here is a legal expert, or has visibility of any of the documents involved you may also be very wise to take your own legal advice on how to respond.

Not_a_clue

You may have to pay your sister half the cost of the stopcock etc. However surely your father got automatic full ownership of the house on your mother's death and so the proceeds from this were a gift from your father, half to you, a third to your sister, and one sixth retained by him to meet any CGT liabilities. As such surely your sister can't challenge how your father decided to gift his own money?

I don't imagine that there was deed of variation involved as the house was never a part of your mother's estate.

childofbaahl

Not a clue = No deed of variation - I had to look up what it was myself. That's how I see it, that the house was my father's to do with as he pleased. So no idea where sis' is getting the notion she had an interest in it. She hadn't lived there for over 15 years, hadn't paid anything towards it ever and she wasn't dependent on my Mum, in fact she barely spoke to her but that's by the by. She hadn't paid anything towards it ever and

Keep Pedaling = I'll look into the accounts and see what's what when I take out the those costs. Though if we go down that route there was also a survey done to get the most accurate valuation for probate / possible sale and if anything to do with the house is to be taken out then that might have to go too. Though could an argument be said that the stopcock and pest control issues were not only there to protect the house itself but also the contents which did form part of the estate? Or am I clutching at straws here.

If I have made a mistake then I'll make that right and thanks you all for your views and help so far, it is greatly appreciated.

eddyinfreehold

CoB

Bear in mind your father will have to survive for 7 years from the date of the gift to you and your sister, otherwise you will be liable to a CGT demand. It would be a good idea to calculate the maximum liability for you both and set that money aside for 7 years. You might in a quiet moment suggest your sister does the same.

NordicNoir

When your Mum and Dad divorced, was there legal paperwork etc. that stated that your Mum was to get the house?

Is it possible that the beneficial ownership of the house was in fact 100% your Mums, even though it had not been officially changed at the Land Registry? Did you take any legal advice on the house situation with your father after your Mum died, to make sure that your understanding was correct?

It may be that your sisters solicitor is trying to determine whether the house should have been included in the estate, as she may have had beneficial ownership, rather than automatically going to your Dad as the joint owner still shown at the Land Registry.

Keep_pedalling

eddyinfreehold wrote: »

CoB

Bear in mind your father will have to survive for 7 years from the date of the gift to you and your sister, otherwise you will be liable to a CGT demand. It would be a good idea to calculate the maximum liability for you both and set that money aside for 7 years. You might in a quiet moment suggest your sister does the same.

That is wrong in so many ways. There is no 7 year rule on capital gains tax. The CGT rules on the sale or disposal of a property after divorce are complex (see following link) so the father needs to take advice on whether he owes any or not, but even if he does he is the sole person responsible for paying it.

https://www.taxation.co.uk/Articles/2015/07/13/333365/home-broken-home

Inheritance tax on the other hand is covered by the 7 year rule, but IHT on gifts made within 7 years of death are usually taking from the estate not the recipients of the gifts. The only time a recipient is responsible for paying IHT is where gifts have exceeded the givers nil rate band of £350k

Keep_pedalling

childofbaahl wrote: »

Not a clue = No deed of variation - I had to look up what it was myself. That's how I see it, that the house was my father's to do with as he pleased. So no idea where sis' is getting the notion she had an interest in it. She hadn't lived there for over 15 years, hadn't paid anything towards it ever and she wasn't dependent on my Mum, in fact she barely spoke to her but that's by the by. She hadn't paid anything towards it ever and

Keep Pedaling = I'll look into the accounts and see what's what when I take out the those costs. Though if we go down that route there was also a survey done to get the most accurate valuation for probate / possible sale and if anything to do with the house is to be taken out then that might have to go too. Though could an argument be said that the stopcock and pest control issues were not only there to protect the house itself but also the contents which did form part of the estate? Or am I clutching at straws here.

If I have made a mistake then I'll make that right and thanks you all for your views and help so far, it is greatly appreciated.

Things like the survey, utility and council tax bills should also be taken out, as should house insurance, although not the portion of that that covered contents.

childofbaahl

Michelle = There was no formal divorce paperwork setting out any settlement or anything of the sort, I checked with the courts on that one whilst looking into the house and finding out they were both still on the deed. As far as I know there is nothing at all in writing to say that my dad gave up the house. Though he hasn't used it in 20+ years he did continue to give my Mum money every month to pay the mortgage. I took legal advice at the time and they were of the opinion that as there was no formal agreement or anything in writing of any kind that the house passed to my father but they weren't 100% certain.

Pedaling = CTax, utility and insurance I paid for myself as I was using them. My father and I went to a financial advisor and were told that we "shouldn't" need to pay any CGTax but to set aside funds enough to pay for it for 5 years as that's the time frame they have to claim unless they believe it to be fraud. So that is what we've done, we split the costs 3 ways and have set aside the money in case payment is required. My sister's funds will be forwarded to her with interest after that period unless CGTax is payable. This was a condition of the house transfer from my dad.

My thinking so far regarding the estate is to include the costs that can only be directly attributable to the contents as the house doesn't form part of the estate and to prepare new accounts. I understand now that this should have been done but I honestly didn't realise. I don't think there will be anything they can do though as I had advanced her a sum from the estate that was owed to me on the understanding that she pay it back from her portion of the final estate (back when we thought the house was still part of it.) I was able to survive without it and she made out that she was in desperate need. That advance was never actually paid back from the estate as there wasn't enough left over, I took it from her mortgage money but as that is a gift and not part of the estate I don't think there is anything she can forcibly do. I will of course ensure that she is made whole regarding the money but only once this is all sorted out.

Then to only answer questions relating to the estate and nothing relating to the house as that is my dad's issue and nothing to do with my sister, the way I have always seen it is my dad gifted the house to me and I made a gift of a large sum of cash to my sister so that my mother's wishes were at least followed in some way.