Sold inherited house- am I a ftb?

sheepy21

Right, so in December my grandmother passed away, I inherited 25% of the house, my sister inherited 50% and our aunt inherited 25%. Out aunt bought our shares in the house immediately after probate was granted. I spoke with my solicitor and they felt that I'm a ftb as although I inherited, I didn't own the house and my aunt bought us out immediately.
I realised today that we signed an as1 form as well as a tr1 form. If I signed the as1 does that mean the property assented into all three names and then the tr1 was for the sale into just my aunts name? Surely I wouldn't have been a registered owner on the land registry as I sold my share of the house?
Very confused, me and my husband already signed the ftb declaration to not pay stamp duty, I obviously don't want to do anything illegal, we also have help to buy ISAs, your thoughts would be appreciated :T
Normally I'd ask the solicitor that dealt with it, but she was utterly useless so want to avoid having to ask her!

kingstreet

If she purchased the property from the estate and all you received was the cash equivalent from the estate; you did not own the property.

If the estate was settled, the property registered to the beneficiaries and then purchased from you, you will not be considered FTB.

sheepy21

Thanks for the reply! As far as I was aware I'd just received the cash from the sale, but having signed the as1 and tr1, does that mean that I received the property first?

SDLT_Geek

Did the AS1 form transfer an interest in the property to you? Or was it drawn up just in favour of the aunt? Who was the !!!8220;transferee!!!8221;?

sheepy21

SDLT_Geek wrote: »

Did the AS1 form transfer an interest in the property to you? Or was it drawn up just in favour of the aunt? Who was the !!!8220;transferee!!!8221;?

I'm not sure, it was a few weeks ago and at the time we just wanted it all over, had no idea that how it was handled could affect us as ftb on the as1 I believe in box 10 declaration of trust, that me, my sister and aunt were all named and our shares in the house. I don't know if all our names were entered in box 6 as transferees for entry in register. We all signed as transferors in box 12

G_M

This was possibly a Capital Gain Tax strategy.


Had the value of the property risen between the date of death (Probate value) and the date of transfer to aunt? By nominally transferring it into ownership of all 3 benefciaries and then immediately to aunt, all 3 CGT llowances could be offset against the gain?

Who were the Executors of the will? Have they explained to you what happened?

Failing that, I'm not sure why an AS1 would have been required - the executors could have simply transferred the property from grandma to aunt.

If it was ransferred vi yourself/sister, then yes, I suspect you are now not a FTB for SDLT purposes.

But you need professional advice I think. Accountant?


(intreagued to know why your sister inherited double you. Had you annoyed grandma in some way..........?)

sheepy21

My aunt was also executor but her solicitor insisted on handling all monies to do with the house. I've spoken with her and she's only ever received documents to say the house was registered in her name, there hasn't been anything else received from land registry etc with mine or my sisters name on. Does that mean we're in the clear?
As for the division, I gave up a quarter to my aunt

G_M

sheepy21 wrote: »

My aunt was also executor but her solicitor insisted on handling all monies to do with the house.
?? how can a solicitor 'insist'? Unless the solicitor was a named Executor, he could only do what he was instrcted to do. But.... however.....

I've spoken with her and she's only ever received documents to say the house was registered in her name, there hasn't been anything else received from land registry etc with mine or my sisters name on. Does that mean we're in the clear?
Not necessarily.
I would get the solicitor to clarify what happened, and answer your question.

As for the division, I gave up a quarter to my aunt

You're a star!

Tom99

[FONT=Verdana, sans-serif]Sounds like the property was transferred to the beneficiaries before being sold to the Aunt, even if this was only the beneficial interest and not the legal interest. If sounds like you are not a FTB.[/FONT]
[FONT=Verdana, sans-serif]As said possible done for CGT purposes in which case you may have to complete a CGT return for the disposal of your 25% share, but the quick disposal time scale would make that an odd choice.[/FONT]
[FONT=Verdana, sans-serif]If the beneficial interest was transferred to you the solicitor/executor should have been aware of the new FTB stamp duty rules and discussed the effect on your FTB status with you beforehand.[/FONT]
[FONT=Verdana, sans-serif]Did the Aunt pay you more than probate value? [/FONT]

da_rule

This sounds like a back-to-back assent and transfer, which is why only one title register was produced/supplied.

You signed an AS1 which assented the property to you (and the others) as beneficiaries. You then signed a TR1 which transferred your share in the property to your aunt.

Therefore, for most scheme you will struggle to class yourself as a first time buyer as you had an interest in the property, no matter how fleeting it may have been.

One possible way around it would be to vary the will via a deed of variation. You vary the will so that your share in the property passes directly to your aunt. The variation takes effect from the date of death and makes it so that the will was always written in that way. If you vary it to remove your share of the house then you would never be deemed to have inherited it and as such would never have had an interest in it. You would also want some form of side agreement from your aunt that in consideration of you doing this she will pay you (the amount she paid you for your share). I would talk to a probate solicitor first, but it may get you back to first time buyer status.

Tom99

da_rule wrote: »

One possible way around it would be to vary the will via a deed of variation. You vary the will so that your share in the property passes directly to your aunt. The variation takes effect from the date of death and makes it so that the will was always written in that way. If you vary it to remove your share of the house then you would never be deemed to have inherited it and as such would never have had an interest in it. You would also want some form of side agreement from your aunt that in consideration of you doing this she will pay you (the amount she paid you for your share). I would talk to a probate solicitor first, but it may get you back to first time buyer status.

[FONT=Verdana, sans-serif]I don't think a DOV will work because a DOV is only backdated to the date of death for CGT and IHT purposes. It is not backdated for any other purpose including income tax, stamp duty, deprivation of assets and, I assume, FTB status.[/FONT]
[FONT=Verdana, sans-serif]Also since the Aunt would need to make a payment in return for the DOV it would not even be valid for CGT or IHT purposes.[/FONT]