HELP !! Expat dealing with the death of my Mum in the UK

martyfarty69

Hello All.
Hopefully some of you good people can provide some help if anybody else has dealt with this. My Mum passed away a couple of months ago and left my Brother and myself has the executors of her Estate.
The snag is my Brother is a resident of the Isle of Man and I am a resident of the USA and have been for 20 years. 
My mums estate is actually fairly simple, less than 10K in Bank account and a house worth a little over 150K which is actually already sold ( the house was listed in early May and sold within a couple of days ) 
My Brother ran into an issue opening an Executors account as neither of us are residents and at this point the estate is held up along with the sale of the house as we have no means of setting up an account. He did suggest using his own Lloyds bank account which would be in his name only. 
My issues with that are two-fold.

1: I am concerned about my tax exposure here in the US. Foreign inheritance is thankfully not subject to any tax implications for me here in the US, but if someone just randomly transfers a large amount of money to me then there are potential tax implications to that and I want to avoid that.
2: It's not that I don't trust my brother, but if I relinquish that responsibility and allow the estate to be transferred into his account without my name on it, what are the implications for me ? What if in the time between the account being set up in his name only and the estate being settled something happens to him ? How would I be able to access those funds ? 

Anyone with any experience and can offer advice / guidance would be greatly appreciated.

Thanks

M

poppystar

Presumably you are using a solicitor for the conveyance - is there any reason why they can’t split the proceeds and give half to each in your own accounts rather than an executor account? 

martyfarty69

Thanks Poppystar
My brother has actually been applying for the Probate and handling the paperwork himself. As far as the solicitor goes on the Conveyance we haven't been in contact with them ourselves as our estate agent has been handling it all as part of their "Package" for the sale.

Sorry if I sound dumb, but i've been living in the US for so long I really have no concept of how any of this works int he UK anymore.

poppystar

Assuming the money from the sale is not needed to cover any other estate debts then I don’t see why it can’t be split 50% to each of you. I have no experience of such estate agent package deals but I would have thought you could have arranged this via the estate agent then even if you have no contact with the solicitor directly. Better that for all concerned than having a sale fall through because of delays in giving account details for the money to go to. Few people use executor’s accounts in reality. 

mebu60

Is it possible to get the conveyancer to split the house sale proceeds then use your brother's account for the residual funds? 

Brie

1: I am concerned about my tax exposure here in the US. Foreign inheritance is thankfully not subject to any tax implications for me here in the US, but if someone just randomly transfers a large amount of money to me then there are potential tax implications to that and I want to avoid that.

Ensure you get a complete paper trail of where the money came from and how it ended up in your account stateside.  I would have thought there would be more of an issue with accusations of money laundering rather than it being a tax issue but either way documentation is the key.

2: It's not that I don't trust my brother, but if I relinquish that responsibility and allow the estate to be transferred into his account without my name on it, what are the implications for me ? What if in the time between the account being set up in his name only and the estate being settled something happens to him ? How would I be able to access those funds ? 

It's not your brother you need to worry about, it's his own family.  If he has a will that says "all to my loving partner" and croaks then the money in the account should go to loving partner.  Now loving partner should be a sensible individual and know that £XXX is from mom's estate and 50% goes to you but not all partners are sensible and potentially not particularly loving either.  So again documentation.  Bro could get a little document drawn up that outlines what's his and what's yours.  It might be a codicil to his will if he has one.  Get the solicitor to agree with the wording.  

fyi - dealing with a vaguely similar situation but in the other direction and on the better side of the 49th.  

martyfarty69

These are all great suggestions and feedback. I really appreciate it.
I'll contact the Estate Agent / Solicitor and see if there is any issue with just having the proceeds from the sale deposited directly. The reality is that 90% of her Estate is the House with very little in Cash assets ( Less than 10K ) once all of her financial obligations / bills have been paid back.

Thanks again all. I really appreciate it.