Residential nil rate £150,000

mdni

Good morning. I had had good advice for my mum in the past but things have changed

Mum came to live with me about 5 years ago. Her retirement flat sold February 2020. She has investments of approx £400,000 + £215,000 flat sale all in 2 trusts

Please can anyone confirm that she (her estate) can still use her residential nil rate band £150,000 as neither her IFA or solicitor can give me a straight answer. Surely this can't be an unusual situation?

Second question - more complicated?
Her income from pension is approx £900 a month. She pays £400 towards the house.
I understand she can gift £3000 + several £250 each tax year. I am her POA
She gifts the grandchildren £250 at Christmas and buys a smaller gift for birthdays (actual gift, not cash) she has done this since they were born
She gifts me the £3000 from her pension income - is this correct or should it come from investment income? 
Her IFA says that now she has lost capacity I should not gift to myself as POA and definitely not from investments. 

Third point
The solicitor with whom the trusts were set up went bankrupt and the business transferred to another solicitor. Part of the cash from the sale of the flat has been invested but approx £70,000 is sitting in the solicitors bank account doing nothing. My solicitor has been requesting this money for over a year without a response. She advised me to open a METRO account in May. To do this I need the original Trust document but despite many requests they have still not sent it. I can rarely speak to someone. One person is sympathetic but nothing happens, others won't speak to me as I have employed another solicitor. They are now blaming each other, denying messages received. 
What can I do to solve this? How do I complain? Who to?

Mum had a severe stroke in April. She returned home but is paralysed and has 2 x carers 4 time a day. Approx cost is £700 a week so I desperately need this money from the trusts

Many thanks to anyone who reads all this and has an answer. I tried to keep it short - much more has gone on. Please ask if I need to give more info

Dazed_and_C0nfused

I understand she can gift £3000 + several £250 each tax year. 

You're understanding is wrong.  There is no limit whatsoever on gifts.

Jeremy535897

Did your father use all his nil rate bands? If not, and they were still married when he died, your mother should benefit from that.

The rules on downsizing or selling the family home are complex, and explained here:
https://www.gov.uk/guidance/how-downsizing-selling-or-gifting-a-home-affects-the-additional-inheritance-tax-threshold

Without knowing the nature of the trusts involved, it is impossible to advise further.

Lifetime gifts above the annual and other exemptions are not taxable as Dazed says, but if mother dies within seven years of making them, they will reduce her nil rate band of £325,000.

The source of a gift can only be relevant if claiming the normal expenditure out of income exemption. It is normally inappropriate to make gifts using a POA when the donor has lost capacity. That does not stop the funds being used to pay for the carers, as that is for mother's benefit. That is subject to the terms of the trusts, which may affect what is actually in her estate, and how income is taxed.

You should raise a formal complaint with the firm of solicitors involved, using their complaints procedure, which should be set out in the letter of engagement. The procedure may be on their website. This, and further action, is explained here:
 https://www.lawsociety.org.uk/public/for-public-visitors/using-a-solicitor/complain-about-a-solicitor

Albermarle

Perhaps just another example of having trusts complicating a situation, often without bringing a great deal of benefit, or not as much as hoped anyway?

Keep_pedalling

What sort of trusts are these and who are the beneficiaries of the trust. I agree with the above putting all her assets into trusts looks to have been a terrible idea and having seen and commented on your other thread I can’t see a sensible reason for why this was done.