Money gifting probate and wills

Belle1576

My dad passed in February and didn’t update his will, we brought a house together, he gifted me the money for his part of the house, it would have been 6 years in August. He did live at the house and contributed towards the bills etc.
the amount of money was £240000 which is about 40% of the property ownership 
I want to give my brothers their share of the money he put into the house, so will be selling the house to do this.
first question is do I have to do inheritance tax form or what ever it is?
what to do about probate do I need to do this?
 also need to set up trusts account for my nieces that were not in the will but would like to treat them the same as the other grandchildren, they are under 18 

p00hsticks

When you say he didn't update his will, that implies that there is one, (even if he may have been meaning to change it)  ? 

If so, then whoever is named as executor of the will would to apply for probate if necessary - which will be if he owned property, shares or had savings over the limit which the savings institution will release funds to an executor without probate (the limit varies from institution to institution). 

Also it's not clear from the post in whose names the property is in - just yours or both you and your fathers and if the latter whether it was owned as joint tenants or tenants in common ? If joint tenants, then ownership would automatically pass to you regardless of what any will says. 

The executor is legally obliged to carry out what is written in the will. However, if the will does not reflect what you believe your father would have later wished, it is possible to do a 'deed of variation' within two years of the death, providing that any beneficiary who would be made worse off agrees to it. For example if you wished your brother to have a greater share than you to make up for the fact that your father gave you money in his lifetime, you could do a deed of variation and that part of the estate would go directly to him from the estate rather than it being given to you and you gifting it to him, which may avoid later inheritance tax issues if you were then to die within seven years. 

Keep_pedalling

Do you live there? If not you may have a CGT liability to think about as well.

The gift will use up his entire NRB plus a bit more as he failed to live 7 years after the gift. You will almost certainly need probate and possibly have to do an IHT return as well, depending on the total value of his estate and his marital status.

Belle1576

Hi the property is in mine and my husband’s name, we lived here with him. As we both put money in we are also the executor of his will. I don’t think his estate will be higher than £325000. Also I don’t think my mums IHT was used as everything went straight to my dad. My dad was widowed.
yes he did mean to change it to include 2 more grandchildren and because he brought a house with us.

not sure what NRB is 

elsien

All the affected beneficiaries will need to agree a change to Include the extra children, unless it comes out of individual people’s portions. If the children who are beneficiaries are under 18, I don’t think they can agree to any change so their share will have to stay as it is. 

 You can’t just decide to change the will off your own bat even if it is what you believe it is what your father would have wanted.

Keep_pedalling

Sorry, NRB = nil rate band. 

It sounds like you will not need to do an IHT return, even if his estate was over £325k his wife’s unused NRB is available. You will only need probate if any savings or investments cannot be released without it.

Belle1576

I’m not deciding to change it off my own bat my father wanted to include them, but unfortunately he didn’t get to change his will, his death was very unexpected, and thought he had more time.

thanks for your help keep peddling, I have been doing lots of reading and getting confused with all the information, and dealing with my grief and all that goes with it 

p00hsticks

Belle1576 said:

. I don’t think his estate will be higher than £325000. 

Is that including the £240k that he gave to you ? As he died within seven years of the gift I think that (the majority of that sum ) would fall back into his estate.

Notepad_Phil

Belle1576 said:

I’m not deciding to change it off my own bat my father wanted to include them, but unfortunately he didn’t get to change his will, his death was very unexpected, and thought he had more time.
...

Not a problem to do a deed of variation if the beneficiaries over the age of 18 can agree to vary their own shares to benefit those who have been left out, but they can't agree to reduce any amounts that the existing will says are to go to those under 18.

Belle1576

p00hsticks said:

Belle1576 said:

. I don’t think his estate will be higher than £325000. 

Is that including the £240k that he gave to you ? As he died within seven years of the gift I think that (the majority of that sum ) would fall back into his estate.

Yes that includes the gifted money

madbadrob

So the house is in yours and your husbands name and basically your father gifted you the money to buy the house which in return you shared with him.  If this is correct as I understand your post then the house will not form any part of his estate although the gift will.  So with the house not in the equation and assuming the 240k was not given to you would the estate be worth the IHT value?  Did your father use any of your late mothers IHT allowances?  If not then the IHT Threshold for your father would be 650k   If it is under the IHT threshold then you can forget the whole NRb situation.  

Did your late father have savings in his bank accounts? If so are they asking for probate or letters of Administration for you to access the accounts?  If not then if all the above applies probate may not be required.  With regards the bank accounts did he hold any of these with you in a joint account situation?  If so then that money becomes yours on his death and also falls outside of his IHT calculations.  These monies also in law do not form a part of the will.

Finally if you change any of the will even if it is detrimental to yourself I would get a deed of variation to protect you from any problems in the future such as needing LA care fees etc.

All that said a quick trip to speak to a Citizens advice beareau solicitor may be a prudent course of action as this doesnt come  across as straight forward amd we all may have missed something 

Rob