Gift with reservation

AnnaEverett

My MIL gifted her house to get 2 children in 2012 and died in 2024. 

Probate has gone through but the house wasn’t included. 

We have since been advised that the gift has failed as she didn’t pay any market value rent, should this have gone through probate as there could now potentially be a big CGT bill to pay. 

The probate solicitor has said that it shouldn’t be included as it was already in their names. 

Helllpppp! 

Keep_pedalling

If the house is sold the 2 children will certainly be facing a CGT liability based on the increase in value over 13 year period since the house was transferred. 

As far as probate valuation is concerned the house is not oars of her estate, but it is for inheritance tax. What was the estate valuation provided for probate? What is the current valuation of the house? What was her marital status?

AnnaEverett

Value for probate was 350k, but didn’t get put through,  recently sold for £362,500. 

MIL was married husband deceased. 

Probate granted was to the value of 91k

RAS

Ok, so IHT isn't and wasn't ever an issue as her IHT allowance was £1m? And presumably no issue with deprivation of assets as yet, because she would have had been a full fee payer initially.

What was the value of the house when it was signed over to the grandchildren? Deduct that value from the sale price and calculate the CGT bill based on the grandchildren's tax rate. 

They have 60 days from the date of sale to pay. 

Not too costly a mistake because deprivation of assets issues would have been raised if she needed residential care. But the person advising on the property transfer should have seen both possibilities and advised properly.