Land registry after death advice needed

Tiglet2

wenger08 said:

p00hsticks said:

wenger08 said:

Keep_pedalling said:

How did you own the property, Joint tenants or  tenants in common? Are we talking about the marital home or some other property? 

If you held as joint tenants then you become the sole owner automatically, if not then it will pass either by his will if he had one, or by the intestacy rules 

If this is the marital home your mother would be very foolish to give her share up, and it could have significant impacts on IHT and CGT. What is the value of the property?

Just on this 2nd question you asked, what would be the best way to avoid IHT and CGT if my mum was to pass away? She is talking about gifting me 25% of the family home as well, would i then have to pay IHT and CGT on this? She says that if she doesnt pass away for 7 years then i dont have to pay anything on this gift, is that correct? (i have asked her to ask solicitors advice but shes adamant she knows what shes doing!)

Thanks

Unless you are also living in the family home , gifting a share to you will immediately start the CGT clock ticking for you. And unless she starts paying you a market rent to live in your share, then it is a 'gift with reservations of benefit' and so doesn't fall out of her estate for IHT purposes. 

In general it's not usually  good move to give away the home you are living in - it leaves you vulnerable and is often done to avoid scenarios which wouldn't apply anyhow - is her estate likely to be over £1 million ? If not, she' probably worrying unnecessarily, If it is she can afford to pay for proper legal advice. 

Thanks. Yes im living in the family home and always have been. Does this change things in terms of her gifting?

Perhaps google Deprivation of Assets?

wenger08

Keep_pedalling said:

wenger08 said:

Keep_pedalling said:

How did you own the property, Joint tenants or  tenants in common? Are we talking about the marital home or some other property? 

If you held as joint tenants then you become the sole owner automatically, if not then it will pass either by his will if he had one, or by the intestacy rules 

If this is the marital home your mother would be very foolish to give her share up, and it could have significant impacts on IHT and CGT. What is the value of the property?

Thanks. Sorry should have been more clear. It is a property we rent out, it is not the family/marital home. We were joint tenants.

So when you say it will pass to me automatically, does this mean i dont have to fill out a DJP form for this at all then? Or should i fill one put anyway?

It passes to you by survivorship, so does not form part of his estate that can be willed (although it does form part of his estate for IHT purposes). You should still complete the DJP.

"If this is the marital home your mother would be very foolish to give her share up, and it could have significant impacts on IHT and CGT. What is the value of the property?"

Just on this 2nd question you asked, what would be the best way to avoid IHT and CGT if my mum was to pass away? She is talking about gifting me 25% of the family home as well, would i then have to pay IHT and CGT on this? She says that if she doesnt pass away for 7 years then i dont have to pay anything on this gift, is that correct? (i have asked her to ask solicitors advice but shes adamant she knows what shes doing!)

Thanks

Assuming you no longer live there, gifting any part of the family home does not help with IHT planning as it will be classed as a gift with reservation of benefit, so will not be subject to the 7 year rule for gifting and could lumber you with a CGT liability further down the line. If she has more in savings than she will need to live comfortable for the rest of her life cash gifts are a better option. 

Everything your father left to you mother is exempt from IHT, and if everything went to her she would have up to £1M in exemptions, this will however be reduced by his share of the house passing to you. His estate has a £325k NRB and any unused amount of this can be transferred to your mother’s estate. His share of the house you jointly own will eat into this, and it will be wiped out entirely if it is worth £325k or more. If it is worth more than £325k then IHT will be due on his estate. 

Thanks. I do live in the family/marital home (i always have done). Does this change things for what you're saying above?

The house jointly owned is not worth £325k its more likely worth £200k but with a £100k mortgage. I assume everything else is passing to my mum

Also with the property i jointly owned with dad, do i still need to fill in the DJP form even if its automatically passing to me?

Thanks

Tiglet2

wenger08 said:

Keep_pedalling said:

wenger08 said:

Keep_pedalling said:

How did you own the property, Joint tenants or  tenants in common? Are we talking about the marital home or some other property? 

If you held as joint tenants then you become the sole owner automatically, if not then it will pass either by his will if he had one, or by the intestacy rules 

If this is the marital home your mother would be very foolish to give her share up, and it could have significant impacts on IHT and CGT. What is the value of the property?

Thanks. Sorry should have been more clear. It is a property we rent out, it is not the family/marital home. We were joint tenants.

So when you say it will pass to me automatically, does this mean i dont have to fill out a DJP form for this at all then? Or should i fill one put anyway?

It passes to you by survivorship, so does not form part of his estate that can be willed (although it does form part of his estate for IHT purposes). You should still complete the DJP.

"If this is the marital home your mother would be very foolish to give her share up, and it could have significant impacts on IHT and CGT. What is the value of the property?"

Just on this 2nd question you asked, what would be the best way to avoid IHT and CGT if my mum was to pass away? She is talking about gifting me 25% of the family home as well, would i then have to pay IHT and CGT on this? She says that if she doesnt pass away for 7 years then i dont have to pay anything on this gift, is that correct? (i have asked her to ask solicitors advice but shes adamant she knows what shes doing!)

Thanks

Assuming you no longer live there, gifting any part of the family home does not help with IHT planning as it will be classed as a gift with reservation of benefit, so will not be subject to the 7 year rule for gifting and could lumber you with a CGT liability further down the line. If she has more in savings than she will need to live comfortable for the rest of her life cash gifts are a better option. 

Everything your father left to you mother is exempt from IHT, and if everything went to her she would have up to £1M in exemptions, this will however be reduced by his share of the house passing to you. His estate has a £325k NRB and any unused amount of this can be transferred to your mother’s estate. His share of the house you jointly own will eat into this, and it will be wiped out entirely if it is worth £325k or more. If it is worth more than £325k then IHT will be due on his estate. 

Thanks. I do live in the family/marital home (i always have done). Does this change things for what you're saying above?

The house jointly owned is not worth £325k its more likely worth £200k but with a £100k mortgage. I assume everything else is passing to my mum

Also with the property i jointly owned with dad, do i still need to fill in the DJP form even if its automatically passing to me?

Thanks

Family/Marital home - owned as joint tenants by mum and dad.  Correct?
Rental property - owned as joint tenants by dad and son.  Correct?

Sorry, it's quite confusing to me when you say 'we' and are talking about two properties.

You don't have to complete a DJP form.  It can be sorted out when you come to sell in the future.  My father was still named as a Joint Proprietor on my mum's property, even though he died 30 years earlier.  When my mum passed and I was selling the property, I just had to submit my father's death certificate (+ probate for my mum).  I believe there are no fees for submitting the DJP, so you can do it if you want to tidy up the title, but it isn't necessary.

wenger08

Tiglet2 said:

wenger08 said:

Keep_pedalling said:

wenger08 said:

Keep_pedalling said:

How did you own the property, Joint tenants or  tenants in common? Are we talking about the marital home or some other property? 

If you held as joint tenants then you become the sole owner automatically, if not then it will pass either by his will if he had one, or by the intestacy rules 

If this is the marital home your mother would be very foolish to give her share up, and it could have significant impacts on IHT and CGT. What is the value of the property?

Thanks. Sorry should have been more clear. It is a property we rent out, it is not the family/marital home. We were joint tenants.

So when you say it will pass to me automatically, does this mean i dont have to fill out a DJP form for this at all then? Or should i fill one put anyway?

It passes to you by survivorship, so does not form part of his estate that can be willed (although it does form part of his estate for IHT purposes). You should still complete the DJP.

"If this is the marital home your mother would be very foolish to give her share up, and it could have significant impacts on IHT and CGT. What is the value of the property?"

Just on this 2nd question you asked, what would be the best way to avoid IHT and CGT if my mum was to pass away? She is talking about gifting me 25% of the family home as well, would i then have to pay IHT and CGT on this? She says that if she doesnt pass away for 7 years then i dont have to pay anything on this gift, is that correct? (i have asked her to ask solicitors advice but shes adamant she knows what shes doing!)

Thanks

Assuming you no longer live there, gifting any part of the family home does not help with IHT planning as it will be classed as a gift with reservation of benefit, so will not be subject to the 7 year rule for gifting and could lumber you with a CGT liability further down the line. If she has more in savings than she will need to live comfortable for the rest of her life cash gifts are a better option. 

Everything your father left to you mother is exempt from IHT, and if everything went to her she would have up to £1M in exemptions, this will however be reduced by his share of the house passing to you. His estate has a £325k NRB and any unused amount of this can be transferred to your mother’s estate. His share of the house you jointly own will eat into this, and it will be wiped out entirely if it is worth £325k or more. If it is worth more than £325k then IHT will be due on his estate. 

Thanks. I do live in the family/marital home (i always have done). Does this change things for what you're saying above?

The house jointly owned is not worth £325k its more likely worth £200k but with a £100k mortgage. I assume everything else is passing to my mum

Also with the property i jointly owned with dad, do i still need to fill in the DJP form even if its automatically passing to me?

Thanks

Family/Marital home - owned as joint tenants by mum and dad.  Correct?
Rental property - owned as joint tenants by dad and son.  Correct?

Sorry, it's quite confusing to me when you say 'we' and are talking about two properties.

You don't have to complete a DJP form.  It can be sorted out when you come to sell in the future.  My father was still named as a Joint Proprietor on my mum's property, even though he died 30 years earlier.  When my mum passed and I was selling the property, I just had to submit my father's death certificate (+ probate for my mum).  I believe there are no fees for submitting the DJP, so you can do it if you want to tidy up the title, but it isn't necessary.

Family/Marital home - owned as joint tenants by mum and dad.  Correct? Yes correct
Rental property - owned as joint tenants by dad and son.  Correct? Yes correct

Sorry for the confusion, when im sayign we im referring to me and mum since dad has passed away, apologies.

Would filling in the DJP do any harm you think?

Thanks

Tiglet2

wenger08 said:

Tiglet2 said:

wenger08 said:

Keep_pedalling said:

wenger08 said:

Keep_pedalling said:

How did you own the property, Joint tenants or  tenants in common? Are we talking about the marital home or some other property? 

If you held as joint tenants then you become the sole owner automatically, if not then it will pass either by his will if he had one, or by the intestacy rules 

If this is the marital home your mother would be very foolish to give her share up, and it could have significant impacts on IHT and CGT. What is the value of the property?

Thanks. Sorry should have been more clear. It is a property we rent out, it is not the family/marital home. We were joint tenants.

So when you say it will pass to me automatically, does this mean i dont have to fill out a DJP form for this at all then? Or should i fill one put anyway?

It passes to you by survivorship, so does not form part of his estate that can be willed (although it does form part of his estate for IHT purposes). You should still complete the DJP.

"If this is the marital home your mother would be very foolish to give her share up, and it could have significant impacts on IHT and CGT. What is the value of the property?"

Just on this 2nd question you asked, what would be the best way to avoid IHT and CGT if my mum was to pass away? She is talking about gifting me 25% of the family home as well, would i then have to pay IHT and CGT on this? She says that if she doesnt pass away for 7 years then i dont have to pay anything on this gift, is that correct? (i have asked her to ask solicitors advice but shes adamant she knows what shes doing!)

Thanks

Assuming you no longer live there, gifting any part of the family home does not help with IHT planning as it will be classed as a gift with reservation of benefit, so will not be subject to the 7 year rule for gifting and could lumber you with a CGT liability further down the line. If she has more in savings than she will need to live comfortable for the rest of her life cash gifts are a better option. 

Everything your father left to you mother is exempt from IHT, and if everything went to her she would have up to £1M in exemptions, this will however be reduced by his share of the house passing to you. His estate has a £325k NRB and any unused amount of this can be transferred to your mother’s estate. His share of the house you jointly own will eat into this, and it will be wiped out entirely if it is worth £325k or more. If it is worth more than £325k then IHT will be due on his estate. 

Thanks. I do live in the family/marital home (i always have done). Does this change things for what you're saying above?

The house jointly owned is not worth £325k its more likely worth £200k but with a £100k mortgage. I assume everything else is passing to my mum

Also with the property i jointly owned with dad, do i still need to fill in the DJP form even if its automatically passing to me?

Thanks

Family/Marital home - owned as joint tenants by mum and dad.  Correct?
Rental property - owned as joint tenants by dad and son.  Correct?

Sorry, it's quite confusing to me when you say 'we' and are talking about two properties.

You don't have to complete a DJP form.  It can be sorted out when you come to sell in the future.  My father was still named as a Joint Proprietor on my mum's property, even though he died 30 years earlier.  When my mum passed and I was selling the property, I just had to submit my father's death certificate (+ probate for my mum).  I believe there are no fees for submitting the DJP, so you can do it if you want to tidy up the title, but it isn't necessary.

Family/Marital home - owned as joint tenants by mum and dad.  Correct? Yes correct
Rental property - owned as joint tenants by dad and son.  Correct? Yes correct

Sorry for the confusion, when im sayign we im referring to me and mum since dad has passed away, apologies.

Would filling in the DJP do any harm you think?

Thanks

No, not at all, particularly if the properties are owned as joint tenants, as you said.

If they are owned as Tenants in Common, then the DJP can be a bit of a pain when you come to sell in the future, because the Tenant in Common who passed would have (hopefully) made a Will setting out who they wanted to leave their share of the property to and there will be a Form A restriction on the title to protect that.  There is often the need to appoint a second trustee in this situation, to make sure the Will is followed and the beneficial owners receive their inheritance.  This can cause delays when selling.  I'm not an expert on this though, so I'm others will explain better than I can.

p00hsticks

Tiglet2 said:

wenger08 said:

Keep_pedalling said:

How did you own the property, Joint tenants or  tenants in common? Are we talking about the marital home or some other property? 

If you held as joint tenants then you become the sole owner automatically, if not then it will pass either by his will if he had one, or by the intestacy rules 

If this is the marital home your mother would be very foolish to give her share up, and it could have significant impacts on IHT and CGT. What is the value of the property?

 It is a property we rent out, it is not the family/marital home. We were joint tenants.

@p00hsticks

OP confirmed it wasn't the family home

@Tiglet2 - I was responding to the second part of the OPs post (the part I quoted)  where they said that the mother was talking about gifting 25% of the family home to them, and they asked what the CGT and IHT consequences might be....

Keep_pedalling

wenger08 said: 

p00hsticks said:

wenger08 said:

Keep_pedalling said:

How did you own the property, Joint tenants or  tenants in common? Are we talking about the marital home or some other property? 

If you held as joint tenants then you become the sole owner automatically, if not then it will pass either by his will if he had one, or by the intestacy rules 

If this is the marital home your mother would be very foolish to give her share up, and it could have significant impacts on IHT and CGT. What is the value of the property?

Just on this 2nd question you asked, what would be the best way to avoid IHT and CGT if my mum was to pass away? She is talking about gifting me 25% of the family home as well, would i then have to pay IHT and CGT on this? She says that if she doesnt pass away for 7 years then i dont have to pay anything on this gift, is that correct? (i have asked her to ask solicitors advice but shes adamant she knows what shes doing!)

Thanks

Unless you are also living in the family home , gifting a share to you will immediately start the CGT clock ticking for you. And unless she starts paying you a market rent to live in your share, then it is a 'gift with reservations of benefit' and so doesn't fall out of her estate for IHT purposes. 

In general it's not usually  good move to give away the home you are living in - it leaves you vulnerable and is often done to avoid scenarios which wouldn't apply anyhow - is her estate likely to be over £1 million ? If not, she' probably worrying unnecessarily, If it is she can afford to pay for proper legal advice. 

Thanks. Yes im living in the family home and always have been. Does this change things in terms of her gifting?

it makes a difference as far IHT and CGT is concerned, in that it would not be classed as a gift with with reservation if you continue to live there as as your primary residence you would not be subject to CGT. It is only really worth doing if your mother’s estate is in IHT territory, which would be over £900k in her case. 

Do you both have wills and powers of attorney in place? 

Tiglet2

p00hsticks said:

Tiglet2 said:

wenger08 said:

Keep_pedalling said:

How did you own the property, Joint tenants or  tenants in common? Are we talking about the marital home or some other property? 

If you held as joint tenants then you become the sole owner automatically, if not then it will pass either by his will if he had one, or by the intestacy rules 

If this is the marital home your mother would be very foolish to give her share up, and it could have significant impacts on IHT and CGT. What is the value of the property?

 It is a property we rent out, it is not the family/marital home. We were joint tenants.

@p00hsticks

OP confirmed it wasn't the family home

@Tiglet2 - I was responding to the second part of the OPs post (the part I quoted)  where they said that the mother was talking about gifting 25% of the family home to them, and they asked what the CGT and IHT consequences might be....

Yes, you are quite correct, thank you.  

SoozyJ22

Tiglet2 said:

If they are owned as Tenants in Common, then the DJP can be a bit of a pain when you come to sell in the future, because the Tenant in Common who passed would have (hopefully) made a Will setting out who they wanted to leave their share of the property to and there will be a Form A restriction on the title to protect that.  There is often the need to appoint a second trustee in this situation, to make sure the Will is followed and the beneficial owners receive their inheritance.  This can cause delays when selling.  I'm not an expert on this though, so I'm others will explain better than I can.

I acted as a second trustee recently where one of the Tenants in Common died while a house sale had been agreed but the parties had not yet exchanged. I'm an executor, but don't know if that was a necessary condition for doing this. I'm not sure how much additional work it caused for the solicitors, but all I had to do was to let the solicitors do an identity check on me and then sign the TR1.