can we transfer a relative £18k as per mums wishes

longwalks1

My mother in law passed last year and left her estate to the 3 children (my partner being one of them). Mum wanted a sum of £18,000 giving to a close relative (mums ex daughter in law) and the 3 children agreed to do this.  It isn’t documented in the will.
plan was to either transfer the full £18,000 from the executors account before the rest of the money is divided as per the will, or for each of mums 3 children to transfer her £6000 each from their own banks once the estate funds have been distributed as per the will. 

which would be a better, more transparent way to do this?  Also, would £18k landing in her bank account raise any eyebrows?  There’s nothing to hide obviously, but unsure if her bank or the taxman would question it

thank you everyone in advance 

boingy

If there is a will then the executor does not have any choice but to distribute the money as per that will, regardless of verbal instructions/requests.

Once the money is distributed then the recipients are free to do whatever they wish with the money.

theoretica

The greatest questions about where money came from seem to relate to using that money as a house deposit.  So it might help the recipient if there is a deed of variation - you don't need to pay a lawyer for it.   https://www.gov.uk/alter-a-will-after-a-death

silvercar

Needs the beneficiaries to agree a Deed of variation or to give from their shares. They could easily document it in a letter.

Yorkie1

Or I think that there could be a deed of variation from the three beneficiaries, which means that the money then goes from the estate to the close relative directly, without going through the bank accounts of the three children.

If any of the three children are reliant on means-tested benefits, then this might be an option worth considering as otherwise the receipt of the 'extra' £6K and then giving it away may impact on their eligibility for those benefits.

p00hsticks

Yorkie1 said:

If any of the three children are reliant on means-tested benefits, then this might be an option worth considering as otherwise the receipt of the 'extra' £6K and then giving it away may impact on their eligibility for those benefits.

For means tested benefits I don't believe it would make any difference either way - they'd have to sign a deed of variation to give up the rights to their share, which for benefits purposes is the same as receiving the money and giving it away. 

silvercar

This thread would be better placed on the death/ probate, wills board. I will ask the forum team to move it.

Marcon

longwalks1 said:

My mother in law passed last year and left her estate to the 3 children (my partner being one of them). Mum wanted a sum of £18,000 giving to a close relative (mums ex daughter in law) and the 3 children agreed to do this.  It isn’t documented in the will.
plan was to either transfer the full £18,000 from the executors account before the rest of the money is divided as per the will, or for each of mums 3 children to transfer her £6000 each from their own banks once the estate funds have been distributed as per the will. 

which would be a better, more transparent way to do this?  Also, would £18k landing in her bank account raise any eyebrows?  There’s nothing to hide obviously, but unsure if her bank or the taxman would question it

thank you everyone in advance 

The bank is highly likely to ask where the money has come from if the amount is significantly out of line with the usual sums being paid into someone's account. It's a money laundering requirement for them to do so - but nothing to worry about. She may need to provide some sort of documentation - but it's routine and for 'just' £18K isn't going to be exhaustive.

Malthusian

Yorkie1 said:

If any of the three children are reliant on means-tested benefits, then this might be an option worth considering as otherwise the receipt of the 'extra' £6K and then giving it away may impact on their eligibility for those benefits.

Poohsticks is correct, this is a very bad idea. A DOV would be considered deliberate deprivation and they would be assessed as if they had received the inheritance, while still having to get by without it.

Savvy_Sue

It's good that all three are in agreement about doing this. I think if I were one of the executors, I would suggest the Deed of Variation, simply because it feels 'cleaner' to me. 

For example, the lucky recipient only needs to give bank details once, to the executor who is sorting it out, rather than to three. Of course they could each send a cheque, but plenty of us no longer have cheque books. 

Plus, it concentrates the minds of those giving up part of their bequests: they've SAID they're happy with this, but are they really? 

And it prevents any potential ill-feeling if Fred takes a long time to make the transfer, because he's disorganised and not very good at internet banking (see above). 

Plus it means that it then bypasses the givers altogether, which can be a help if they're going to have a potential IHT liability down the road. 

Be aware of the unwisdom of doing a DofV if in receipt of means tested benefits: again, talking about doing on may make it easier to bring this up - and receiving the money and giving it away could be just as bad, I believe. 

tetrarch

Getting a DOV will amend effectively amend the will as though it were written that way originally. You do NOT need a solicitor for this

A signed DOV also will guarantee "permission" as the existing beneficiaries will have given their written authority for the transfer.

I can see no problem with an early payment of the £18K - especially as it is a specific amount, rather than a percentage

Regards

Tet