Distributing Estate - no will

Superb52

bobster2 said:

pollypenny said:

Sadly, if she didn't make a will any savings she had go to her husband. 

Not all of it to the husband if in England & Wales and estate is worth over £270,000

The husband, wife or civil partner gets:

• up to £270,000 in assets, and half of the rest of the estate
• all of the personal possessions of the deceased

The children of the deceased are entitled to a share of the half of the estate above £270,000.

Unfortunately, she had nowhere near that much & most of what she did have went in care home fees.

elsien

Superb52 said:

comeandgo said:

Which country are you in?

I'm in the UK

I think they meant England, Scotland et cetera. Because Scottish law can be  different

Superb52

Mojisola said:

Superb52 said:
My mum died intestate earlier this year.
Although she had no will she did tell her husband her wishes & that included passing money to her children.
My stepdad has been told he can't pass any money to us without him having to pay a huge amount of tax due to rule changes.

Is this an excuse he's using because he doesn't want to just say no to complying with her wishes?

I don't think so, we were all working on the basis he wouldn't give us anything but he said he wanted to. He's even included us in his will. He's a very decent & trusting guy, which is why I'm concerned about the advice he's getting. 

Superb52

Keep_pedalling said:

Marcon said:

Superb52 said:

Hi,
My mum died intestate earlier this year.

Although she had no will she did tell her husband her wishes & that included passing money to her children. 

My stepdad has been told he can't pass any money to us without him having to pay a huge amount of tax due to rule changes. I'm confused by this as the only tax risk I thought there would be is if he dies within 7 years but surely that relates to inheritance tax which I am certain won't be an issue. 

He is looking at passing £15k to each of us. 

I have suggested a deed of variation may solve the issue but he doesn't really understand.

Can someone explain the tax risks to my stepdad if he passes money to us without a deed of variation.

Many thanks. 

He won't have to pay any tax. If he dies within 7 years then his estate might have to pay some tax, but not on all the money. He can gift a total of up to £3,000 a year (and if he didn't make any gifts last year, then he can use £3,000 from that year).

For some clarity, you can gift as much as you like, the £3k is an exemption not a limit. If some tax was due on the gifts it would still be less than would be payable if no gifts were made ( because of the annual exemption) and would still be payed from the residual estate not clawed back from the people who received the gifts.

None of this really matters unless your net worth is in IHT territory.

Thanks, that really helps. It is what I thought but good to get clarification.

Superb52

elsien said:

Superb52 said:

comeandgo said:

Which country are you in?

I'm in the UK

I think they meant England, Scotland et cetera. Because Scottish law can be  different

Good point 🤣 That'll be England then.