Confused now that the house is sold

D198632

My mother sadly passed away November last year, with me appointed as sole executor. The estate was valued at well under the IHT threshold and compromises of just cash and a vacant property.

I applied for probate myself and have dealt with the settling of any debts and the closing of any accounts.Probate was obtained in December 2017 but the house has only just sold. No income during this period just utilities and costs relating to the maintenance and sale of the house.

I’m now really stuck and have been researching online but am even more confused.

As there was no income do I still need to contact HMRC and submit a nil Estate tax return or can I just produce the summary Estate accounts for the beneficiaries to sign and then proceed and distribute the funds?

Many thanks

Margot123

I was in a similar situation a few years ago.

No income was generated from the property, so there was no need to inform HMRC. I was advised by my solicitor that if I did, and gave them 'unnecessary information' it would possibly trigger a case file (think that was the term).

I just gave the beneficiaries a copy of the accounts to sign-off, paid them and that was the end of it.

Keep_pedalling

You do not need to do a return, if there was no income or if she paid no income tax in the year share died. If she paid tax there is likely to be a rebate to be claimed.

You only need to support accounts to residual beneficiaries, and they do not need to be signed off.

D198632

Thank you both for the fast responses, this makes me feel a bit more comfortable now.

Margot123

Keep_pedalling wrote: »

You do not need to do a return, if there was no income or if she paid no income tax in the year share died. If she paid tax there is likely to be a rebate to be claimed.

You only need to support accounts to residual beneficiaries, and they do not need to be signed off.

Yes, should have added that the residual beneficiaries don't need to sign-off the accounts BUT it is prudent to ask that they do. They would have little argument at a later date if they disagree with the amount.

I have never yet had anyone refuse to sign; they just want their money!

D198632

Thanks again for the clarification, super helpful.

I may be making this more complicated than it needs to be. We had plenty of warning as Mum was terminal so we ensured that I was added to her bank accounts as a joint account holder. My understanding is that this means that technically all the funds became my sole asset at her point of death. So anything paid in and out of the account from that point onward is completely separate from the Estate administration period?

I still included the value of funds for the IHT calculation so all I need to be concerned with is if there was a capital gain made between her death and the house sale? I foolishly made an error of undervaluing the property by deducting the outstanding mortgage (sounds stupid now I think about it as doesn't make any sense) but evidence of actual sales made in the same street before and up to this date would clearly back this up.

So I think i'm safe to just distribute with my siblings and try to move on.

Thanks very much

YoungBlueEyes

I can't help with IHT etc, but re the joint bank account, yes you're right.

My father and I had a joint account and the money in there became solely mine when he passed. They did not form part of his estate.