Inheritance

spikeymouse

My dad passed away and mam is to receive around 50,000 . She is coming 76yrs old and in a council flat so recieves pension , council tax etc... she wants to give me ( her daughter) some money as I was left out of dads will. Is she able to do this? We understand she will have to pay  full rent, council tax etc... until she down to £16,000. Any info much appreciated. Thank you.

sammyjammy

You would be better posting on the Benefits board for help, as she is 76 yrs old there maybe different rules as to the capital.

Robin9

If there  was a will this is best done by a Deed of Variation 

Has she claimed the 25% Council Tax reduction ?

MallyGirl

I will move this to the benefits board as they will have more knowledge to help you

calcotti

spikeymouse said:

My dad passed away and mam is to receive around 50,000 . She is coming 76yrs old and in a council flat so recieves pension , council tax etc... she wants to give me ( her daughter) some money as I was left out of dads will. Is she able to do this? We understand she will have to pay  full rent, council tax etc... until she down to £16,000. Any info much appreciated. Thank you.

Your post is not clear. She receives state pension. You say she receives Council Tax. Council Tax is something you pay. Do you mean she receives Council Tax Reduction, in which case she presumably also receives Housing Benefit.

Do you know how much her state Pension is? Does she have any other income? Does she receive Pension Credit? Does she already have savings? Does she receive a disability benefit? If so does any one claim Carer’s Allowance or carer element of UC for looking after her and does she live alone?

if she gives away some of the money, for benefits purposes, this will be treated as deprivation of capital and she will be treated as if she still has it. For Pension Credit with £50,000 there would be a deduction from the amount payable of £80/week. However if her state pension is less than £93 and she has no other income she would still be entitled to some guarantee Pension Credit which would allow her to still claim Housing Benefit and CTR.

More information is needed to confirm her situation.

Did dad have any occupational pensions which mum might inherit?

calcotti

Robin9 said:

If there  was a will this is best done by a Deed of Variation 

Has she claimed the 25% Council Tax reduction ?

if the estate is only worth £50,000 and mum has no assets of her own I don’t think there is any need for a deed of variation.

Regardless, for benefits purposes mum will be treated as having the £50,000 even if she gives it away.

squirrelpie

calcotti said:

Robin9 said:

If there  was a will this is best done by a Deed of Variation

if the estate is only worth £50,000 and mum has no assets of her own I don’t think there is any need for a deed of variation.

Regardless, for benefits purposes mum will be treated as having the £50,000 even if she gives it away.

I don't understand the relevance of £50,000 to the desirability of a Deed of Variation. And I believe that if the will is adjusted by a Deed of Variation, it will make a substantial difference for benefits purposes. Mum will not have inherited whatever is given to the daughter and won't be depriving herself of it.

calcotti

squirrelpie said:

calcotti said:

Robin9 said:

If there  was a will this is best done by a Deed of Variation

if the estate is only worth £50,000 and mum has no assets of her own I don’t think there is any need for a deed of variation.

Regardless, for benefits purposes mum will be treated as having the £50,000 even if she gives it away.

I don't understand the relevance of £50,000 to the desirability of a Deed of Variation. And I believe that if the will is adjusted by a Deed of Variation, it will make a substantial difference for benefits purposes. Mum will not have inherited whatever is given to the daughter and won't be depriving herself of it.

My understanding is that the advantage of a Deed of Variation is that the gift is taken from the deceased estate and therefore does not become of the surviving relatives estate if they then die. This can be helpful for inheritance tax purposes but if the value of the etates is low inheritance tax is not going to be an issue anyway.

Whether a Deed of variation is written or not will make no difference for benefits purposes. By making a Deed of Variation mum will be giving away money that was originally left to her and this could, I believe, be deprivation of capital in exactly the same way as giving it away. There's an old thread on the subject here https://forums.moneysavingexpert.com/discussion/5776181/can-a-deed-of-variation-leave-benefits-unaffected

As always, the decision on deprivation of capital will fall to a Decision Maker to determine motivation.

TELLIT01

My understanding of the way Deed of Variance is considered in connection with Income Related benefits is the same as Calcotti.  It is likely to be classed as Deprivation of Capital unless the original recipient can provide proof that the deceased intended the money to go to the daughter.

jamesd

Robin9 said:

If there  was a will this is best done by a Deed of Variation 

According to law firm Barker Evans:

"When shouldn’t you use a deed of variation?

There are some situations where a variation of a Will or intestacy would be unwise. 

o Means-tested benefits – if a beneficiary is receiving or applying for means-tested benefits and he or she re-directs their inheritance to someone else, this is likely to breach the disclosure rules. It could make them ineligible for certain benefits or even liable to prosecution, in some cases."

squirrelpie

Thanks for the clarification everybody