Help needed - so grateful for any advice.

WoodyMax

I hope someone can help. My Son's half-sister's mother has recently died and the house was in her name and that of her estranged husband. Her mother left a will that everything she owned went to her daughter (young adult). The estranged husband (father of my sons half sister) has agreed that he will sign over his half of the house to his daughter.  The daughter was just hoping to sell the house and move on - value of house approx. £400,000 what liability will she have in terms of IHT and or CGT and are there any ways she could minimise these costs. By the way her father lives in US for several years and has no intention of moving back to UK.

Thank you

RAS

How recently did the mother die?

You say estranged? Where the mother and father still legally married when she died?

And in addition to the house, are there any other assets like savings? Insurance policies and death in service may not be included the assets, depending who the nominated beneficiary is.

Keep_pedalling

Assuming the house was held as tenants in common the inheritable share will only be £200k and as the estate has a total exemption of £500k (NRB + RNRB) it is unlikely that IHT will be an issue unless she had other major assets. CGT does not apply here.

The other half of the house is a gift from her father, and her father may have a CGT liability on the transfer if it is no longer his residence. Any increase in value since he moved out over £6k will mean CGT is due. 

If they still held the property as joint tenants it is rather different as her father would now automatically be the sole owner so he would actually be gifting the whole lot.

p00hsticks

WoodyMax said:

I hope someone can help. My Son's half-sister's mother has recently died and the house was in her name and that of her estranged husband. Her mother left a will that everything she owned went to her daughter (young adult). The estranged husband (father of my sons half sister) has agreed that he will sign over his half of the house to his daughter. 

Was the house owned as joint tenants or tenants in common ?
If the former then it would have automatically passed to the father on the mothers death, regardless of what the mother's will said. 

If the latter, then the mothers half does indeed pass to the daughter as specified in the will.
 
As it sounds as if the father was not living in the property , then I think he may be potentially liable to Capital Gains Tax when gifting (his share of) the property to his daughter, but it would be complicated by the fact that he is now living abroad. 

WoodyMax

Thank you so much for the replies.

The girls mother died suddenly 3 weeks ago.  Her husband (girls father) was living in US for the past 16 years and still does and they were never divorced. The mother ended up paying the mortgage on the house for those past 16 years with no help from the estranged husband (and struggled hard to do so).
The mother was a teacher so I think there may have been some death in service insurance which she would have nominated her daughter to receive.
The father has agreed to gift his daughter ''his half'' of the house and if she sells it to give him 25% if whatever she gets for it.
I am still trying to find out whether it was purchased as Joint Tenants or Tenants in Common.
Unfortunately the father and daughter have not had a great relationship the past few years either but my son has managed to mediate the 25 percent deal between them.

Brie

If he is "gifting" then he doesn't get anything back for doing so.  If he is asking her to sell on his behalf I would certainly be sure that he pays capital gains tax at least on his share.  

I think you can get land registry info for a couple of £ and that might tell you what you're after.

RAS

Go to the gov.uk website and download the deeds for £3. You are looking for a statement somewhere along the lines of "No disposition of the property......"

WoodyMax

Thanks again for your replies.  I did download the Title Register and it shows both the mother and father's names on there under ''title absolute'' no mention of the type of ownership i.e. Joint tenants or not.  There is a charge on the property by the bank which I knew and mother had a policy to cover any left over mortgage in the event of her death. There is no mention of ''disposition of the property''
thanks all

WoodyMax

@Brie

He is gifting what he accepts is his ''half'' of the house.  However if she comes to sell the property he would like her to give him 25 percent of what that is - but that is between the two of them (if indeed she ever does sell)