House value for probate with Deed of Trust

crabbit65

I am one of two executors of my mother’s estate. We are selling her house.
When my mother bought the house she did so with the aid of my brother. She paid half and he paid half. My mother had the benefit of the house rent free. My mother then had a Deed of Trust drawn up to ensure that when the house was sold that half of the proceeds went to my brother.
My understanding of this situation is that my mother is the sole owner of the house. When I come to do the estate valuation I therefore must include the whole value of the house, £200,000 and not half of the value. Is this correct?
Thank you for any assistance.

getmore4less

Did the deed include the right to live in the place for life rent free?
Was the deed done at purchase time or later?

Legal and beneficial interests need determining to establish the IHT and CGT positions

When the place was bought may be relevant with the tax rules changes over the years.

Even if there is no IHT, there may be a CGT issue if it was not done properly.

crabbit65

Hi
Thanks for the reply. The Deed of Trust was done after the purchase. My mother wrote that my brother had a half share of the house in a will. When she rewrote her will the solicitor said that it would be best if there was a Deed of Trust for my brother to save any confusion. I think it was also done to resolve any CGT issues that might have risen.
My mother had the benefit of the house, rent free, until her death and this was stipulated in the Deed of Trust.
Cheers

getmore4less

What year was that deed done?

crabbit65

Hi
The property was bought in 1989 and the Deed of Trust was signed in 1995.
Cheers

xylophone

How is the property registered at the Land Registry?

Is your late mother shown as sole proprietor?

Tom99

Sounds like your mother may be the sole legal owner but only have a 50% beneficial interest so £100,000.

getmore4less

crabbit65 wrote: »

Hi
The property was bought in 1989 and the Deed of Trust was signed in 1995.
Cheers

That was before 2006 when changes were made to how properties with life interest were treated for tax purposes.

Get proper legal and tax advise that applies to that time period.

xylophone

Is there any Form A or B restriction on the Register?

getmore4less

The legal title is not relevant to the beneficial interest that determines the tax situation.

crabbit65

Hi
In the 1989 Land Registry Plan Under B.Proprietorship Register there is a restriction by which no dispostion by the proprietor of the land is to be registered without the consent of my brother.
The 21-3-1995 Deed of Trust states that the registered proprietor and my brother have agreed that the Property shall as from today be held by them in equal shares. Which I think means that my mother is the 'Registered Proprietor', ie 'Sole Proprietor' my brother has an equitable interest.

I am assuming, which may be a mistake, that 'Registered Proprietor' and 'Sole Proprietor' mean the same thing.

So, at the moment I am leaning towards putting down £200,000 as the 'Registered Proprietor' and then allocate accordingly, with my brother getting his equitable share before anything else is done.
Does that make sense?
Cheers for the help