Ways To Reduce IHT - Adding Daughter To Deeds?

Emmia

jumpingjaq said:

Thank you for all the helpful answers.

I will try to answer some of the points you have raised.

If my daughter were to die, I would want her husband to inherit my estate. 

My daughter and son do not speak to each other, and other than birthday/Christmas cards (which are sent out of a sense of ‘duty’ I suppose), I do not have any contact with my son either. He is not a nice person, and there is a long history of him mistreating me, including threatening behaviour. The last time we saw each other was three years ago at my own mother’s funeral, where we only said a couple of words to each other. 

He has his own home and a well paid job, and is in no way dependent on me. He has no children, but as far as I know has a partner. I do not know if they live together.

I hope that explains why I want to write my will in the way that I do.

 

Whether or not you speak, and irrespective of his financial position your son may still believe he will be entitled to, and will therefore expect a share of your estate on your death (especially if your son in law inherits) - on that basis he may challenge the will.

pphillips

Emmia said:

jumpingjaq said:

Thank you for all the helpful answers.

I will try to answer some of the points you have raised.

If my daughter were to die, I would want her husband to inherit my estate. 

My daughter and son do not speak to each other, and other than birthday/Christmas cards (which are sent out of a sense of ‘duty’ I suppose), I do not have any contact with my son either. He is not a nice person, and there is a long history of him mistreating me, including threatening behaviour. The last time we saw each other was three years ago at my own mother’s funeral, where we only said a couple of words to each other. 

He has his own home and a well paid job, and is in no way dependent on me. He has no children, but as far as I know has a partner. I do not know if they live together.

I hope that explains why I want to write my will in the way that I do.

 

Whether or not you speak, and irrespective of his financial position your son may still believe he will be entitled to, and will therefore expect a share of your estate on your death (especially if your son in law inherits) - on that basis he may challenge the will.

He may have an expectation but, unless his behaviour and financial circumstances change, that expectation is probably unreasonable.

jumpingjaq

Thank you once again for your help. It is much appreciated. This is the first time I have written a will, so it’s a steep learning curve!

To answer another couple of points (and I know this has strayed from the original question, but nothing is ever simple, is it?!). If my daughter was to divorce and then die before me, then I would want my grandchildren (her two sons) to inherit my estate.

After your queries about my son, and the possibility of him trying to make a claim on the estate, it made me think. After a little research, it would appear that I would need to also write a ‘Letter or Wishes’ outlining why I have made the decisions in the will.

Just to clarify the original question, regarding putting my daughter on my deeds, to possibly reduce the amount of IHT payable, the answer is no, it’s not worth it. Given the value of the house, the remaining assets and the provision of the RNRB, coupled with the fact I’m not under 50 (I wish!), it would be better to leave things as they are on the deeds. 

getmore4less

The big issue with putting anyone on the deeds(and gifting them that share)  if they did not live there  it would be a gift with reservation and not change the IHT position.

Keep_pedalling

jumpingjaq said:

Thank you once again for your help. It is much appreciated. This is the first time I have written a will, so it’s a steep learning curve!

To answer another couple of points (and I know this has strayed from the original question, but nothing is ever simple, is it?!). If my daughter was to divorce and then die before me, then I would want my grandchildren (her two sons) to inherit my estate.

After your queries about my son, and the possibility of him trying to make a claim on the estate, it made me think. After a little research, it would appear that I would need to also write a ‘Letter or Wishes’ outlining why I have made the decisions in the will.

Just to clarify the original question, regarding putting my daughter on my deeds, to possibly reduce the amount of IHT payable, the answer is no, it’s not worth it. Given the value of the house, the remaining assets and the provision of the RNRB, coupled with the fact I’m not under 50 (I wish!), it would be better to leave things as they are on the deeds. 

I would rethink the idea of leaving your son-in-law your entire estate in the event of your daughter dying before you. As far as tax is concerned your estate would lose its RNRB allowance if you did that. By all means leave him something to help bring your grandchildren up, but the bulk of your estate should go to the grand children under those circumstances.

pphillips

Keep_pedalling said:

jumpingjaq said:

Thank you once again for your help. It is much appreciated. This is the first time I have written a will, so it’s a steep learning curve!

To answer another couple of points (and I know this has strayed from the original question, but nothing is ever simple, is it?!). If my daughter was to divorce and then die before me, then I would want my grandchildren (her two sons) to inherit my estate.

After your queries about my son, and the possibility of him trying to make a claim on the estate, it made me think. After a little research, it would appear that I would need to also write a ‘Letter or Wishes’ outlining why I have made the decisions in the will.

Just to clarify the original question, regarding putting my daughter on my deeds, to possibly reduce the amount of IHT payable, the answer is no, it’s not worth it. Given the value of the house, the remaining assets and the provision of the RNRB, coupled with the fact I’m not under 50 (I wish!), it would be better to leave things as they are on the deeds. 

I would rethink the idea of leaving your son-in-law your entire estate in the event of your daughter dying before you. As far as tax is concerned your estate would lose its RNRB allowance if you did that. By all means leave him something to help bring your grandchildren up, but the bulk of your estate should go to the grand children under those circumstances.

Not according to the Gov.uk website:

Who is a direct descendent

For RNRB purposes the direct descendant is:

• a child, grandchild or other lineal descendant
• a husband, wife or civil partner of a lineal descendant (including their widow, widower or surviving civil partner)

This also includes:

• a child who is, or was at any time, their step-child
• their adopted child
• a child fostered at any time by them
• a child where they’re appointed as a guardian or special guardian when the child is under 18

However, I do agree with the idea that generation skipping can be a useful way of reducing IHT.

Keep_pedalling

pphillips said:

Keep_pedalling said:

jumpingjaq said:

Thank you once again for your help. It is much appreciated. This is the first time I have written a will, so it’s a steep learning curve!

To answer another couple of points (and I know this has strayed from the original question, but nothing is ever simple, is it?!). If my daughter was to divorce and then die before me, then I would want my grandchildren (her two sons) to inherit my estate.

After your queries about my son, and the possibility of him trying to make a claim on the estate, it made me think. After a little research, it would appear that I would need to also write a ‘Letter or Wishes’ outlining why I have made the decisions in the will.

Just to clarify the original question, regarding putting my daughter on my deeds, to possibly reduce the amount of IHT payable, the answer is no, it’s not worth it. Given the value of the house, the remaining assets and the provision of the RNRB, coupled with the fact I’m not under 50 (I wish!), it would be better to leave things as they are on the deeds. 

I would rethink the idea of leaving your son-in-law your entire estate in the event of your daughter dying before you. As far as tax is concerned your estate would lose its RNRB allowance if you did that. By all means leave him something to help bring your grandchildren up, but the bulk of your estate should go to the grand children under those circumstances.

Not according to the Gov.uk website:

Who is a direct descendent

For RNRB purposes the direct descendant is:

• a child, grandchild or other lineal descendant
• a husband, wife or civil partner of a lineal descendant (including their widow, widower or surviving civil partner)

This also includes:

• a child who is, or was at any time, their step-child
• their adopted child
• a child fostered at any time by them
• a child where they’re appointed as a guardian or special guardian when the child is under 18

However, I do agree with the idea that generation skipping can be a useful way of reducing IHT.

I stand corrected, thank you.

haras_n0sirrah

I would also go grandchildren after daughter mainly because if son in law remarried then your entire estate could go sideways to another woman if son in law pre deceased her and she didn't leave anything to your grandchildren in favour of her own children
 It wouldn't be the first time 

csgohan4

A lot more complex than it seems OP. Getting a solicitor who deals with wills is important, especially if you want to minimise Inheritance to one child and reduce a successful  appeal by them on your death.