Right to occupancy clause in will

moneysaver371

Hi

I have a question about a will including a right to reside/occupancy clause as I’ve been made an executor/trustee. It is a very similar situation experienced by another user in this topic: https://forums.moneysavingexpert.com/discussion/6098270/holding-a-house-in-trust

The Will of the family member who has passed away states that their adult child can live in the property rent-free indefinitely (subject to them paying all bills) until they decide to move. At this point, the property can be sold to distribute the proceeds to the beneficiaries.

Is this a 'trust' or a clause, and does it need to be registered to HMRC? If so is there some guidance on how to register a trust?

Also do the title deeds have to be updated to show the 'trustees of the estate' (or something along those lines) or can they be left until the sale?

Any advice would be appreciated. Thanks

Keep_pedalling

This is a clause that establishes a trust on the death of a testator. This sort of trust only needs to be registered if the life tenant (the child given the right to remain in the house) is likely to remain in place for mor the two years in which case it needs to be registered within the two years. If you are not one of the ultimate beneficiaries then in your shoes I would be reluctant to take on the role of trustee and try and dump that on the ultimate beneficiaries unless they are minors.

If we were talking about a life interest for a spouse I would say no need to register with the land registry, but foe a child I would advise you (or the trustees) do so. 

https://www.gov.uk/trusts-taxes/registering-a-trust

https://www.gov.uk/guidance/register-a-trust-as-a-trustee

lr1277

Are you the sole executor? If so you may not want to hear the followin. I mention this incase distributing your relative’s estate takes many years instead of many months.
Should you die before completing distribution of the estate, then the executor of your will also becomes the executor of your relative’s will. Suspect this might also apply if you don’t have a will and somebody applies for letters of administration.
Suggest you have your own will in place if you don’t already.Let your executor know this might be a possibility.
I found this information by searching on: what happens if an executor dies before the will is distributed.

Keep_pedalling

lr1277 said:

Are you the sole executor? If so you may not want to hear the followin. I mention this incase distributing your relative’s estate takes many years instead of many months.
Should you die before completing distribution of the estate, then the executor of your will also becomes the executor of your relative’s will. Suspect this might also apply if you don’t have a will and somebody applies for letters of administration.
Suggest you have your own will in place if you don’t already.Let your executor know this might be a possibility.
I found this information by searching on: what happens if an executor dies before the will is distributed.

The life interest trust should not push distribution of the estate back any longer than a simple estate. The will creates the trust which becomes the legal owner of the house and the distribution to the ultimate beneficiaries (remainder men) will be down to the trustees of the trust rather than the executor of the will.

That said, the advice about having their own will in place is still a sound one.

moneysaver371

Thank you for the help, I am not a beneficiary of the property but not sole executor. I guess my next question would be how does having my name on the title deeds as trustee affect my future first time buyer status (i.e. Lifetime ISA bonus, FTB relief) even though I'm not going to get a share or own the house?

Keep_pedalling

There is no need to have your name on the deeds, the trusts trustees are the people why need to make the changes and unless the remainder men are minors once the estate has been finalised I would hand that responsibility to them so you are shot of it.