Is Lendy peer2peer loan asset for Probate ?

LynneD0

I am executor for my brother's estate. He 'invested' £110k with Lendy who are now in administration. Am I right in thinking that despite the fact I may get little or nothing back I must still include the full amount as an asset for Probate which will mean I will be paying IHT ?

Keep_pedalling

LynneD0 said:

I am executor for my brother's estate. He 'invested' £110k with Lendy who are now in administration. Am I right in thinking that despite the fact I may get little or nothing back I must still include the full amount as an asset for Probate which will mean I will be paying IHT ?

That is a difficult one. Although Lendy are in administration, his money is actually owed by a number of borrowers who raised loans through that platform. Some of those loans will be in default and others will be meeting their payments, so it is difficult for you to establish the value of of investments.

I would suggest you contact the administrators to make them aware of your brother’s death and to see if they can actually provide the current status of his account. There is also a Facebook group that supports the unfortunates who put money into Lendy that might be useful. Details for both can be found in the following link.

https://www.financialthing.com/lendy-saving-stream/

noh

https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/373598/IHT416.pdf

IHT 416 is the form that needs to be completed for each debt due to the estate. It does have provision for debts that are not recoverable in full. I don't know how you will estimate the potential amount recoverable also it looks like you will have to fill in IHT 416 for each separate Lendy loan.

LynneD0

I have been in touch with Lendy who have given me a date of death balance. Asking how many loans are in default is a sensible idea so I will go back to them for more detail of individual loans. To Hank you both for your suggestions I will also look at the Facebook link.

Robert_McGeddon

noh said:

https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/373598/IHT416.pdf

IHT 416 is the form that needs to be completed for each debt due to the estate. It does have provision for debts that are not recoverable in full. I don't know how you will estimate the potential amount recoverable also it looks like you will have to fill in IHT 416 for each separate Lendy loan.

How many Lendy loans are there? If more than, say, three, I would be tempted to put in £110K as the total and explain at Box 9 that there is a portfolio of debts whose individual values cannot be ascertained at this time due to the insolvency. NOT technically correct but there seems little point in beating yourself up to put in unverifiable extimates.  You will still need to give an overall estimate and (maybe) pay IHT.  This at least shows you are including all assets and not trying to dodge IHT.  HMRC can come back to you for more info if they deem it necessary.

Malthusian

I would seriously consider getting professional advice from a solicitor, especially if there are beneficiaries other than yourself. The value of the account will be extremely unclear (the value provided by the platform may be based on fictitious par values), and if IHT is payable you are caught between the devil of underpaying IHT and the deep blue sea of underpaying the beneficiaries, unless you pay for a professional to act as human shield.

Anyone with money in P2P or other high-risk pseudo-regulated investments who is considering estate planning should seriously consider getting out of them to avoid leaving their beneficiaries this kind of mess.