Tenants in Common / Beneficial Joint Tenants - Inheritance

*~Zephyr~*

Hi All

Forgive me if I'm asking a dumb question (It's my age you know) because maybe I've read this wrong...

We are all encouraged to purchase property as Tenants in Common to protect ourselves if relationships break down etc etc but when it comes to inheritance, isn't it better to be beneficial joint tenants?

Assuming I have cash assets of £150k.  Our house is owned as TiC, so, assuming its worth £300k, hubby and I each own half £150k worth of the house.  If I died, my £150k would make up part of my estate (totalling £300k) and, if I don't have a will, hubby will only inherit £270k of that outright and then the residual £30k would be split between hubby and my brother (my only other family).

BUT.. reading Citizens Advice page regarding intestacy it appears that if me and hubby own our house as BJT, then the second one of us pops their clogs, the other owns the property in full and its not counted as part of the estate at all.  So my estate would only be considered as the £150k in other assets and hubby will inherit that in its entirety. 

Yes, I know i should probably just go and make a will, but, if I get run over by a bus on my way home this afternoon, wouldn't it be better to have changed the ownership of the property into beneficial joint tenants?

Or have I got completely the wrong end of the stick here...?

getmore4less

The distribution estate and taxable estate are different.

Also the £270k  intestate limit applies to kids not other relatives like brothers.

*~Zephyr~*

getmore4less said:

The distribution estate and taxable estate are different.

Also the £270k  intestate limit applies to kids not other relatives like brothers.

Ah!  So, brother wouldn't get the £30k in this example then?  Would hubby get the lot then?

TBH, I wasn't even thinking about inheritance tax, as I don't expect my estate to ever reach the threshold (there's no pockets in a shroud and all that) but more about the distribution and being BJT just sounded like it would be easier.

Keep_pedalling

*~Zephyr~* said:

getmore4less said:

The distribution estate and taxable estate are different.

Also the £270k  intestate limit applies to kids not other relatives like brothers.

Ah!  So, brother wouldn't get the £30k in this example then?  Would hubby get the lot then?

That is correct, but owning your home as TiC without having wills is only a half completed job and is rather foolish. The potential secondary beneficiaries of  whoever dies first will get nothing, while those of the survivor will get everything. If you were to both simultaneously die in a car crash under the rule of intestacy it is the older spouse who will have been deemed to survive first. If you are older than your husband and this happened to you, your husband will be deemed to have inherited your estate so your combined estate would go to his nearest living qualifying relative, which could be a sibling or a long lost cousin in Australia, it could even go to the crown if he had no qualifying beneficiaries.