Inheritance question 12 October at 9:10AM in Deaths, Funerals & Probate 12 replies 992 views

cdbe11

Adult son has just been left house which he has lived in with late father for past few years. We believe will states that he can live there till death, at which point the house split between his son and his nephew (the grandchildren). Adult son seems incapable of paying iht (maybe £50k) so house will be sold with some kind of expectation that he buys a cheaper property. Son has a lifetime history of "taking" and spending money from family members (nice work if you can get it!).

I would like to know what protection is available for the grandchildren? I can easily see him, for example, downsizing the property and treating himself to a new car etc with any surplus.

I believe the will was arranged through a solicitor so would hope it was arranged reasonably "properly", but would like to have an idea of how this generally plays out - the Son is single, mid 50's in good health etc so the grandchildren are in for a wait, which is fine, but what can they expect?

The father was one of those old fashioned individuals (60 years in the house) who thought son would just continue to live in house till he died and it would then be simply split. 

My "interest" is that my adult son is the nephew, and I can see him and his cousin being fleeced out of this inheritance by their (genuinely nice) but financially selfish Dad/Uncle.

Should my son be taking some kind of action in this situation or will the law protect his interests?

Thanks.

Jim80

Find out what the Will actually says and not what you believe it says

Keep_pedalling

You also seem to believe the estate will be subject to IHT, how have you worked that out?

You also say the son has inherited the house, which would not seem to be the case as he only has a life interest in it.

What is the total value of the estate, and what was the marital status of the deceased?

Flugelhorn

@cdbe11 the questions above are the key ones - there may not be IHT payable unless the estate is particularly large. Crucial to see the wording of the will - if the house is left to the grandsons with dad/uncle having right to stay there then there will be issues over maintenance / selling it for smaller property etc  / paying the IHT (the estate would have to do this)- who are the trustees etc etc?

If as is more likely it has been left to the dad/uncle then it is up to him what he does with it 

cdbe11

Thanks. I appreciate I might be jumping the gun a bit, this only happened 2 weeks ago, it is on my ex's side so I'm not party to many details (or the will) and I don't think probate has got very far. The house is an owned outright tatty 3 bed semi, but in London so maybe £6-650k. He was divorced (settled 30 years ago), there won't be any other assets (son was good at helping dad get through his pension), son is apparently going to CAB to see how long he can stay in house before he (someone) has to sell to pay iht. 

I suspect the will was made a few years ago while the property was below iht threshold hence no need to consider selling. 

Sorry if I have the wrong terminology but I'm fairly sure it has been left to the two grandsons on death of son, in whatever way that arrangement would normally be made if you walked into a solicitor and expressed that as your wish (as my ex wife/the daughter was apparently quite unhappy to discover this a few years ago). The deceased was generally quite naive; there are five grandchildren, two adults (apparently) get half the house each, one gets nothing because he'll inheritance a lifetime tenancy in a flat in Hampstead, two under 18 get nothing because they're "children and don't need a house", my ex gets nothing because "she has a house".

I presume the solicitor would arrange trustees.

My son is quite naive, I'm not, but don't have any legal experience, so my question is - if my son is supposed to benefit from this arrangement (I guess it must be a trust) does he need to do anything to protect himself - if nothing else when dealing with an individual (who has no real income*) who without any malicious intent, would have no problems in downsizing this valuable property to something along the lines of a tent over the course of his lifetime. I'd rather not get involved as not my side of the family but do you think I should poke my nose in, get a copy of the will etc?

Thanks. 

In writing this I think I've already decided, I'll ask my son for a copy of the will!

Tigsteroonie

As you say, get your son to ask for a copy of the will (and he then lets you see it). A lot will come down to whether the house has been left to the adult son (with the understanding - but no actual power - that it then gets left to their son and your son); or if it has been left to the next generation (grandchildren) with adult son having rights to live there.

Keep_pedalling

Providing he did not make any substantial gifts over the last 7 years, then his executor will be able to claim his full NRB plus his RNRB, leaving 100- 150k subject to IHT. With no liquid assets to pay the tax there is going to be little other option than to sell the house. The net proceeds could then be used to purchase alternative accommodation for your son.

getmore4less

If sold the net proceeds would typicall stay in the trust(depends on terms in will) and the life tenant has the right to any income.

One option might be to look at dissolving the trust and split the asset 3 ways.

Grandkids give up some of their eventual inheritance to get something now.
Would need all 3 to agree.

Flugelhorn

@cdbe11 how complicated! can imagine the solicitor was feeling cross-eyed by the time this was finished. So hard that some people were left out of the inheritance "because they were under 18 and didn't need a house" etc -

thing that struck me about wills was how quickly time flies, all the "until the reach the age of 18" clauses etc have gone, DS was to be exec and his sister's guardian until she was 18 and the young children in the Armageddon clause will soon be adults too.. maybe a rewrite is indicated 

cdbe11

@Flugelhorn Wills are strange and complicated aren't they, especially theses days - what I didn't mention is that the two children will inherit a share of a  £1M property from their father's side (which their half brother, my Son, won't). I think prodigal Sons rule!

cdbe11

@getmore4less That sounds like an interesting option, a 3 way split. I think somehow the money (my son's bit) needs to stay in property, not eroding in a bank.