Possible Labour Changes in Inheritance Tax

Keep_pedalling

NateW said:

HI KP, seems then that it would have all gone to my mother by what you say, despite my father's wishes.  Yes, it was drawn up by a solicitor. They were joint executor with myself but relinquished that right not long after my father's death.

No, based on your previous post the tenancy was severed in 2004, so they held as tenants in common.

In order to get the property in your name you are going to have to apply for probate for both your parents and are going to need a valuation of the house for the time of both deaths. Because they both died prior to the changes in the probate procedure you are also going to have to submit IHT returns for both of them. Do you have any idea of the house value when your father died?

RAS

NateW said:

HI KP, seems then that it would have all gone to my mother by what you say, despite my father's wishes.  Yes, it was drawn up by a solicitor. They were joint executor with myself but relinquished that right not long after my father's death.

No. As far as I can tell, that is the phrase used to record a basic tenancy in common.

So you will need to complete probate for your father before you do mum's.

Do you still have the renunciation from 2009? Did dad die on or after April 6?

Grumpy_chap

NateW said:

Both my parents have passed in the last 10 years, my mother lastly 5 years ago. Being the sole beneficiary, with no inheritance tax due under current legislation, I have stupidly not sort probate(partly due to exhaustion of being a carer and my own cancer scare) in those 5 years. With a new budget due end of Oct 2024, and possible changes in thresholds for various taxes, if I was to submit now for probate, could those changes to IHT be backdated? Thanks.

NateW said:

I do not think the house will have increased that much, the shares would have but in total the value of the estate is £400-425k.

The Estate(s) look as though they would not be liable for IHT.

However, the delay in resolving matters may mean that the Estate(s) may incur a CGT liability.
You need to ascertain accurate values for the property at date of death and accurate valuation now - not just rely on "not thinking" there has been much increase.

Keep_pedalling

If your father left you nothing other than his share in the house then his estate will not owe ant IHT as his bequest to you would have been below the NRB. You will however have to submit an IHT return using IHT 205. The value of the property at that point is important as it will govern how much of his NRB can be transferred to her estate.

You will also need to submit an IHT return for your mother, but if you don’t have enough transferable NRB to avoid also having to use her residential NRB that will need require the use of IHT 400 which requires a bit more work.

Savvy_Sue

If the OP has lived in the house throughout, where does the potential CGT liability arise?

Keep_pedalling

Savvy_Sue said:

If the OP has lived in the house throughout, where does the potential CGT liability arise?

It doesn’t.  

NateW

RAS said:

NateW said:

HI KP, seems then that it would have all gone to my mother by what you say, despite my father's wishes.  Yes, it was drawn up by a solicitor. They were joint executor with myself but relinquished that right not long after my father's death.

No. As far as I can tell, that is the phrase used to record a basic tenancy in common.

So you will need to complete probate for your father before you do mum's.

Do you still have the renunciation from 2009? Did dad die on or after April 6?

Thanks RAS, sorry for delay in responding, very busy day in office today. My father died in May 2012.

NateW

Grumpy_chap said:

NateW said:

Both my parents have passed in the last 10 years, my mother lastly 5 years ago. Being the sole beneficiary, with no inheritance tax due under current legislation, I have stupidly not sort probate(partly due to exhaustion of being a carer and my own cancer scare) in those 5 years. With a new budget due end of Oct 2024, and possible changes in thresholds for various taxes, if I was to submit now for probate, could those changes to IHT be backdated? Thanks.

NateW said:

I do not think the house will have increased that much, the shares would have but in total the value of the estate is £400-425k.

The Estate(s) look as though they would not be liable for IHT.

However, the delay in resolving matters may mean that the Estate(s) may incur a CGT liability.
You need to ascertain accurate values for the property at date of death and accurate valuation now - not just rely on "not thinking" there has been much increase.

Thanks for your input GC, I had a valuation after my mother's death in 2019, valued at £300k. Sadly I did not on my father's death in 2012, quite difficult to have valued so the estate agents say as it's one of few bungalows in the area.

NateW

Keep_pedalling said:

If your father left you nothing other than his share in the house then his estate will not owe ant IHT as his bequest to you would have been below the NRB. You will however have to submit an IHT return using IHT 205. The value of the property at that point is important as it will govern how much of his NRB can be transferred to her estate.

You will also need to submit an IHT return for your mother, but if you don’t have enough transferable NRB to avoid also having to use her residential NRB that will need require the use of IHT 400 which requires a bit more work.

Thanks KP, sorry for delay in responding, very busy today in office. Re Savvy Sue's query on CGT, I came home to care for my parents in 2010, living with them from then, my father passing in 2012, my mother in 2019. They had lived in the house since 1998.

Savvy_Sue

NateW said:

Keep_pedalling said:

If your father left you nothing other than his share in the house then his estate will not owe ant IHT as his bequest to you would have been below the NRB. You will however have to submit an IHT return using IHT 205. The value of the property at that point is important as it will govern how much of his NRB can be transferred to her estate.

You will also need to submit an IHT return for your mother, but if you don’t have enough transferable NRB to avoid also having to use her residential NRB that will need require the use of IHT 400 which requires a bit more work.

Thanks KP, sorry for delay in responding, very busy today in office. Re Savvy Sue's query on CGT, I came home to care for my parents in 2010, living with them from then, my father passing in 2012, my mother in 2019. They had lived in the house since 1998.

So there's no CGT to worry about in that area then. (I think someone mentioned it earlier, which is why I was querying it.)