How is a trust handled in probate application?

poseidon1

Archiedextrous56 said:

doodling said:

Hi,

Archiedextrous56 said:

Just come across the thread which has been most useful as I’m in the same situation. Property left in the will with 50/50 ownership as tenants in common, with a life interest for the surviving spouse.However im trying to get clarity on two issues:
1. Does this type of will trust need registration on TRS? Traditionally the answer would be No, but since recent changes I believe it may have to be. There will be no income from the property.
2.Do I need to change anything on the Title deeds of the property as a Trustee at this time? I.e to remove deceased name and add me as trustee or beneficiaries? 

I’ve researched this and there are so many conflicting views even in the legal profession.
Any thoughts based on experience would be most welcome.
Many thanks

To answer your questions:

1. Yes, the trust needs to be registered - it can be done online fairly easily.

2. It all depends on how tidy you need to be, which in turn depends on whether the executors and trustees for the first death are the same people.   If they are then it doesn't really matter and you can leave that bit of work for when the second death occurs.  If the executor and trustees for the first death are different people then really you should change the ownership to, for example, "The trustees of [name] (deceased)." As the executors job isn't complete until that is done.

Many thanks for your response. I will register the trust at the end of the 2 year period.Just to clarify, on the second point, my father in law is executor and trustee. His name is obviously on the title deed. I am the other executor and trustee so do I add my name to the title? If so which form would I use? Many thanks again

It would be highly prudent for the exsistence of the trust to be notified on the land registery by way of a Form A and possibly Form B Restriction ( depending on exact terms of the trust). 

Such a restriction puts the world at large on notice that your father in law is not the sole beneficial owner of the property and prevents him ( for example) selling and having the  proceeds solely paid to himself in contravention of the trust terms.

Notifying your trusteeship in this way does not in anyway jeopardise your standing as a first time buyer or for the purposes of 2nd property SDLT , since you do not have any beneficial rights to the property until your FIL's  death. Similarly your trusteeship appearing on the register does not confer any rights to the property to a third party in the event you were to become bankrupt or divorced.

Indeed I would go a stage further and suggest failing to register a Restriction could been seen as an act of trustee negligence on your part, since failing to obtain a Restriction could allow your FIL ( for example )  to obtain an equity release loan unbeknownst to you, potentially wiping out the inheritance of the remainderman.

I am all in favour of these IPDI trusts where circumstances justify, but where lay  people are administering the same without legal input, Form A Restrictions seem to be overlooked. Registering the trust with HMRC on the Trust register is a separate and distinct requirement and does not achieve the protection of a Land Registry Restriction.

I am disappointed you have not received consistent legal guidance on this issue, the competency of some solicitors out there leaves alot to be desired.

Have a word with the Land Registry on this, they are very helpful.

Archiedextrous56

poseidon1 said:

Archiedextrous56 said:

doodling said:

Hi,

Archiedextrous56 said:

Just come across the thread which has been most useful as I’m in the same situation. Property left in the will with 50/50 ownership as tenants in common, with a life interest for the surviving spouse.However im trying to get clarity on two issues:
1. Does this type of will trust need registration on TRS? Traditionally the answer would be No, but since recent changes I believe it may have to be. There will be no income from the property.
2.Do I need to change anything on the Title deeds of the property as a Trustee at this time? I.e to remove deceased name and add me as trustee or beneficiaries? 

I’ve researched this and there are so many conflicting views even in the legal profession.
Any thoughts based on experience would be most welcome.
Many thanks

To answer your questions:

1. Yes, the trust needs to be registered - it can be done online fairly easily.

2. It all depends on how tidy you need to be, which in turn depends on whether the executors and trustees for the first death are the same people.   If they are then it doesn't really matter and you can leave that bit of work for when the second death occurs.  If the executor and trustees for the first death are different people then really you should change the ownership to, for example, "The trustees of [name] (deceased)." As the executors job isn't complete until that is done.

Many thanks for your response. I will register the trust at the end of the 2 year period.Just to clarify, on the second point, my father in law is executor and trustee. His name is obviously on the title deed. I am the other executor and trustee so do I add my name to the title? If so which form would I use? Many thanks again

It would be highly prudent for the exsistence of the trust to be notified on the land registery by way of a Form A and possibly Form B Restriction ( depending on exact terms of the trust). 

Such a restriction puts the world at large on notice that your father in law is not the sole beneficial owner of the property and prevents him ( for example) selling and having the  proceeds solely paid to himself in contravention of the trust terms.

Notifying your trusteeship in this way does not in anyway jeopardise your standing as a first time buyer or for the purposes of 2nd property SDLT , since you do not have any beneficial rights to the property until your FIL's  death. Similarly your trusteeship appearing on the register does not confer any rights to the property to a third party in the event you were to become bankrupt or divorced.

Indeed I would go a stage further and suggest failing to register a Restriction could been seen as an act of trustee negligence on your part, since failing to obtain a Restriction could allow your FIL ( for example )  to obtain an equity release loan unbeknownst to you, potentially wiping out the inheritance of the remainderman.

I am all in favour of these IPDI trusts where circumstances justify, but where lay  people are administering the same without legal input, Form A Restrictions seem to be overlooked. Registering the trust with HMRC on the Trust register is a separate and distinct requirement and does not achieve the protection of a Land Registry Restriction.

I am disappointed you have not received consistent legal guidance on this issue, the competency of some solicitors out there leaves alot to be desired.

Have a word with the Land Registry on this, they are very helpful.

Many thanks for such a comprehensive reply, I appreciate your thoughtful response and time it took to write. I have been in touch with the Land registry recently and took the opportunity to download the Title deed to the property in question. I was surprised to note that there is currently NO restriction listed on the Title, which I find odd, as when the Will was drafted in 2014, both parties severed their joint ownership to become 'tenants in common'. I would have thought a Restriction A would have been logged by the solicitor at that time in order to offer the protections you describe. Based on the facts as they stand then, I clearly need to register a Restriction on the Title in order to protect the interests of the beneficiaries inheritance. Presumably, I can apply for the restriction to be added on the proprietorship register at the Land registry myself without a solicitor? What would happen if FIL has an objection for me doing this?  It is somewhat worrisome that if my FIL did secure an equity release loan without my knowledge, it could wipe out the inheritance. Just out of interest, if that were to happen, would there be recourse to reclaim the money as FIL has ignored the terms laid out in the Will Trust?
Once again many thanks for your insights.

Archiedextrous56

RAS said:

No, you don't add your name to the title deed.

The whole point of the Immediate Post Death Interest trust is that it protects you from CGT, possible additional SDLT tax, and loss of first time buyer status if aren't already a home owner, and ensures that 50% of the house value is protected from things like care fees.

Whilst protecting your parent's needs should you divorce, go bankrupt or die.

Thank you for your response, that makes sense

poseidon1

Archiedextrous56 said:

poseidon1 said:

Archiedextrous56 said:

doodling said:

Hi,

Archiedextrous56 said:

Just come across the thread which has been most useful as I’m in the same situation. Property left in the will with 50/50 ownership as tenants in common, with a life interest for the surviving spouse.However im trying to get clarity on two issues:
1. Does this type of will trust need registration on TRS? Traditionally the answer would be No, but since recent changes I believe it may have to be. There will be no income from the property.
2.Do I need to change anything on the Title deeds of the property as a Trustee at this time? I.e to remove deceased name and add me as trustee or beneficiaries? 

I’ve researched this and there are so many conflicting views even in the legal profession.
Any thoughts based on experience would be most welcome.
Many thanks

To answer your questions:

1. Yes, the trust needs to be registered - it can be done online fairly easily.

2. It all depends on how tidy you need to be, which in turn depends on whether the executors and trustees for the first death are the same people.   If they are then it doesn't really matter and you can leave that bit of work for when the second death occurs.  If the executor and trustees for the first death are different people then really you should change the ownership to, for example, "The trustees of [name] (deceased)." As the executors job isn't complete until that is done.

Many thanks for your response. I will register the trust at the end of the 2 year period.Just to clarify, on the second point, my father in law is executor and trustee. His name is obviously on the title deed. I am the other executor and trustee so do I add my name to the title? If so which form would I use? Many thanks again

It would be highly prudent for the exsistence of the trust to be notified on the land registery by way of a Form A and possibly Form B Restriction ( depending on exact terms of the trust). 

Such a restriction puts the world at large on notice that your father in law is not the sole beneficial owner of the property and prevents him ( for example) selling and having the  proceeds solely paid to himself in contravention of the trust terms.

Notifying your trusteeship in this way does not in anyway jeopardise your standing as a first time buyer or for the purposes of 2nd property SDLT , since you do not have any beneficial rights to the property until your FIL's  death. Similarly your trusteeship appearing on the register does not confer any rights to the property to a third party in the event you were to become bankrupt or divorced.

Indeed I would go a stage further and suggest failing to register a Restriction could been seen as an act of trustee negligence on your part, since failing to obtain a Restriction could allow your FIL ( for example )  to obtain an equity release loan unbeknownst to you, potentially wiping out the inheritance of the remainderman.

I am all in favour of these IPDI trusts where circumstances justify, but where lay  people are administering the same without legal input, Form A Restrictions seem to be overlooked. Registering the trust with HMRC on the Trust register is a separate and distinct requirement and does not achieve the protection of a Land Registry Restriction.

I am disappointed you have not received consistent legal guidance on this issue, the competency of some solicitors out there leaves alot to be desired.

Have a word with the Land Registry on this, they are very helpful.

Many thanks for such a comprehensive reply, I appreciate your thoughtful response and time it took to write. I have been in touch with the Land registry recently and took the opportunity to download the Title deed to the property in question. I was surprised to note that there is currently NO restriction listed on the Title, which I find odd, as when the Will was drafted in 2014, both parties severed their joint ownership to become 'tenants in common'. I would have thought a Restriction A would have been logged by the solicitor at that time in order to offer the protections you describe. Based on the facts as they stand then, I clearly need to register a Restriction on the Title in order to protect the interests of the beneficiaries inheritance. Presumably, I can apply for the restriction to be added on the proprietorship register at the Land registry myself without a solicitor? What would happen if FIL has an objection for me doing this?  It is somewhat worrisome that if my FIL did secure an equity release loan without my knowledge, it could wipe out the inheritance. Just out of interest, if that were to happen, would there be recourse to reclaim the money as FIL has ignored the terms laid out in the Will Trust?
Once again many thanks for your insights.

Your problem with a equity release loan behind your back, is that it could remain undiscovered until after FILs death unless of course you go to the trouble of periodically checking the registry to ensure nothing untoward had happen.

If discovered after death, and by then he had spent all the money, your options as trustee to recover the beneficiaries' half share would be limited to what remains of FIL's estate.

However the big risk here is the beneficiaries ultimately  pursuing you personally  for their loss due to negligence in failing to place the trust Restriction on title. 

FIL shouldn't object to you doing so, since this is prudent recognition that you and he are trustees of this arrangement.

Yes you can attempt to do this yourself, the land registry can assist. However, getting a solicitor involved could be useful in pre-empting any objection FIL might raise. Any objection should be viewed with great concern by yourself by way of his motives for doing so. 

Archiedextrous56

poseidon1 said:

Archiedextrous56 said:

poseidon1 said:

Archiedextrous56 said:

doodling said:

Hi,

Archiedextrous56 said:

Just come across the thread which has been most useful as I’m in the same situation. Property left in the will with 50/50 ownership as tenants in common, with a life interest for the surviving spouse.However im trying to get clarity on two issues:
1. Does this type of will trust need registration on TRS? Traditionally the answer would be No, but since recent changes I believe it may have to be. There will be no income from the property.
2.Do I need to change anything on the Title deeds of the property as a Trustee at this time? I.e to remove deceased name and add me as trustee or beneficiaries? 

I’ve researched this and there are so many conflicting views even in the legal profession.
Any thoughts based on experience would be most welcome.
Many thanks

To answer your questions:

1. Yes, the trust needs to be registered - it can be done online fairly easily.

2. It all depends on how tidy you need to be, which in turn depends on whether the executors and trustees for the first death are the same people.   If they are then it doesn't really matter and you can leave that bit of work for when the second death occurs.  If the executor and trustees for the first death are different people then really you should change the ownership to, for example, "The trustees of [name] (deceased)." As the executors job isn't complete until that is done.

Many thanks for your response. I will register the trust at the end of the 2 year period.Just to clarify, on the second point, my father in law is executor and trustee. His name is obviously on the title deed. I am the other executor and trustee so do I add my name to the title? If so which form would I use? Many thanks again

It would be highly prudent for the exsistence of the trust to be notified on the land registery by way of a Form A and possibly Form B Restriction ( depending on exact terms of the trust). 

Such a restriction puts the world at large on notice that your father in law is not the sole beneficial owner of the property and prevents him ( for example) selling and having the  proceeds solely paid to himself in contravention of the trust terms.

Notifying your trusteeship in this way does not in anyway jeopardise your standing as a first time buyer or for the purposes of 2nd property SDLT , since you do not have any beneficial rights to the property until your FIL's  death. Similarly your trusteeship appearing on the register does not confer any rights to the property to a third party in the event you were to become bankrupt or divorced.

Indeed I would go a stage further and suggest failing to register a Restriction could been seen as an act of trustee negligence on your part, since failing to obtain a Restriction could allow your FIL ( for example )  to obtain an equity release loan unbeknownst to you, potentially wiping out the inheritance of the remainderman.

I am all in favour of these IPDI trusts where circumstances justify, but where lay  people are administering the same without legal input, Form A Restrictions seem to be overlooked. Registering the trust with HMRC on the Trust register is a separate and distinct requirement and does not achieve the protection of a Land Registry Restriction.

I am disappointed you have not received consistent legal guidance on this issue, the competency of some solicitors out there leaves alot to be desired.

Have a word with the Land Registry on this, they are very helpful.

Many thanks for such a comprehensive reply, I appreciate your thoughtful response and time it took to write. I have been in touch with the Land registry recently and took the opportunity to download the Title deed to the property in question. I was surprised to note that there is currently NO restriction listed on the Title, which I find odd, as when the Will was drafted in 2014, both parties severed their joint ownership to become 'tenants in common'. I would have thought a Restriction A would have been logged by the solicitor at that time in order to offer the protections you describe. Based on the facts as they stand then, I clearly need to register a Restriction on the Title in order to protect the interests of the beneficiaries inheritance. Presumably, I can apply for the restriction to be added on the proprietorship register at the Land registry myself without a solicitor? What would happen if FIL has an objection for me doing this?  It is somewhat worrisome that if my FIL did secure an equity release loan without my knowledge, it could wipe out the inheritance. Just out of interest, if that were to happen, would there be recourse to reclaim the money as FIL has ignored the terms laid out in the Will Trust?
Once again many thanks for your insights.

Your problem with a equity release loan behind your back, is that it could remain undiscovered until after FILs death unless of course you go to the trouble of periodically checking the registry to ensure nothing untoward had happen.

If discovered after death, and by then he had spent all the money, your options as trustee to recover the beneficiaries' half share would be limited to what remains of FIL's estate.

However the big risk here is the beneficiaries ultimately  pursuing you personally  for their loss due to negligence in failing to place the trust Restriction on title. 

FIL shouldn't object to you doing so, since this is prudent recognition that you and he are trustees of this arrangement.

Yes you can attempt to do this yourself, the land registry can assist. However, getting a solicitor involved could be useful in pre-empting any objection FIL might raise. Any objection should be viewed with great concern by yourself by way of his motives for doing so. 

That has been very informative, thank you. Mmm I can certainly see where there is a potential risk to the inheritance under such circumstances. I still don’t understand why a restriction A was not registered at the LR when the solicitor drafted the last Wills which severed joint tenancy and converted it to ‘tenants in common’ ? From what I have researched, under these circumstances it seems that a restriction A would be done alongside the will. Is there any mileage in contacting the solicitor and asking the question? 

I will proceed to register the trust on TRS and have a conversation with FIL and beneficiaries about getting the restriction A in place.

poseidon1

Archiedextrous56 said:

poseidon1 said:

Archiedextrous56 said:

poseidon1 said:

Archiedextrous56 said:

doodling said:

Hi,

Archiedextrous56 said:

Just come across the thread which has been most useful as I’m in the same situation. Property left in the will with 50/50 ownership as tenants in common, with a life interest for the surviving spouse.However im trying to get clarity on two issues:
1. Does this type of will trust need registration on TRS? Traditionally the answer would be No, but since recent changes I believe it may have to be. There will be no income from the property.
2.Do I need to change anything on the Title deeds of the property as a Trustee at this time? I.e to remove deceased name and add me as trustee or beneficiaries? 

I’ve researched this and there are so many conflicting views even in the legal profession.
Any thoughts based on experience would be most welcome.
Many thanks

To answer your questions:

1. Yes, the trust needs to be registered - it can be done online fairly easily.

2. It all depends on how tidy you need to be, which in turn depends on whether the executors and trustees for the first death are the same people.   If they are then it doesn't really matter and you can leave that bit of work for when the second death occurs.  If the executor and trustees for the first death are different people then really you should change the ownership to, for example, "The trustees of [name] (deceased)." As the executors job isn't complete until that is done.

Many thanks for your response. I will register the trust at the end of the 2 year period.Just to clarify, on the second point, my father in law is executor and trustee. His name is obviously on the title deed. I am the other executor and trustee so do I add my name to the title? If so which form would I use? Many thanks again

It would be highly prudent for the exsistence of the trust to be notified on the land registery by way of a Form A and possibly Form B Restriction ( depending on exact terms of the trust). 

Such a restriction puts the world at large on notice that your father in law is not the sole beneficial owner of the property and prevents him ( for example) selling and having the  proceeds solely paid to himself in contravention of the trust terms.

Notifying your trusteeship in this way does not in anyway jeopardise your standing as a first time buyer or for the purposes of 2nd property SDLT , since you do not have any beneficial rights to the property until your FIL's  death. Similarly your trusteeship appearing on the register does not confer any rights to the property to a third party in the event you were to become bankrupt or divorced.

Indeed I would go a stage further and suggest failing to register a Restriction could been seen as an act of trustee negligence on your part, since failing to obtain a Restriction could allow your FIL ( for example )  to obtain an equity release loan unbeknownst to you, potentially wiping out the inheritance of the remainderman.

I am all in favour of these IPDI trusts where circumstances justify, but where lay  people are administering the same without legal input, Form A Restrictions seem to be overlooked. Registering the trust with HMRC on the Trust register is a separate and distinct requirement and does not achieve the protection of a Land Registry Restriction.

I am disappointed you have not received consistent legal guidance on this issue, the competency of some solicitors out there leaves alot to be desired.

Have a word with the Land Registry on this, they are very helpful.

Many thanks for such a comprehensive reply, I appreciate your thoughtful response and time it took to write. I have been in touch with the Land registry recently and took the opportunity to download the Title deed to the property in question. I was surprised to note that there is currently NO restriction listed on the Title, which I find odd, as when the Will was drafted in 2014, both parties severed their joint ownership to become 'tenants in common'. I would have thought a Restriction A would have been logged by the solicitor at that time in order to offer the protections you describe. Based on the facts as they stand then, I clearly need to register a Restriction on the Title in order to protect the interests of the beneficiaries inheritance. Presumably, I can apply for the restriction to be added on the proprietorship register at the Land registry myself without a solicitor? What would happen if FIL has an objection for me doing this?  It is somewhat worrisome that if my FIL did secure an equity release loan without my knowledge, it could wipe out the inheritance. Just out of interest, if that were to happen, would there be recourse to reclaim the money as FIL has ignored the terms laid out in the Will Trust?
Once again many thanks for your insights.

Your problem with a equity release loan behind your back, is that it could remain undiscovered until after FILs death unless of course you go to the trouble of periodically checking the registry to ensure nothing untoward had happen.

If discovered after death, and by then he had spent all the money, your options as trustee to recover the beneficiaries' half share would be limited to what remains of FIL's estate.

However the big risk here is the beneficiaries ultimately  pursuing you personally  for their loss due to negligence in failing to place the trust Restriction on title. 

FIL shouldn't object to you doing so, since this is prudent recognition that you and he are trustees of this arrangement.

Yes you can attempt to do this yourself, the land registry can assist. However, getting a solicitor involved could be useful in pre-empting any objection FIL might raise. Any objection should be viewed with great concern by yourself by way of his motives for doing so. 

That has been very informative, thank you. Mmm I can certainly see where there is a potential risk to the inheritance under such circumstances. I still don’t understand why a restriction A was not registered at the LR when the solicitor drafted the last Wills which severed joint tenancy and converted it to ‘tenants in common’ ? From what I have researched, under these circumstances it seems that a restriction A would be done alongside the will. Is there any mileage in contacting the solicitor and asking the question? 

I will proceed to register the trust on TRS and have a conversation with FIL and beneficiaries about getting the restriction A in place.

No point delving into ancient history with regard to a perceived failure to register  the TIC in the past.

 Yes it should have be done when the original parties were alive,  but  you  need to deal with the new legal ownership relationship now taking effect by operation of the terms of the Will. Your duty to do this (as new trustee) is a strict one.  Not something that especially requires debate amongst the parties concerned but if you see the necessity to do so the article below may provide useful support.

https://www.jonathanlea.net/blog/how-to-register-a-declaration-of-trust-at-the-land-registry/#:~:text=In registered land the way,that proprietor was a trustee.




 

Archiedextrous56

I wondered if anyone can kindly provide a bit more clarity on registering a Restriction A on a property where a severance of tenancy already exists as I’m getting confused by Land registry guidance. Can my father in law complete a SEV form as the remaining proprietor (Mother in law now deceased) to register the restriction? Or, as we are both trustees outlined in the Will, need to use the RX1 form?