Stepmum trying to demand money

Highlandchick

I lost my dad 3 weeks ago to cancer. I dont live near him so traveled to say my goodbye to him. I left everyone on a sad but happy note. Since his passing I have left everything to his wife to sort as she is his next of kin and down on will as so. Me and my siblings knew we wouldnt inherit anything and that our stepmum would inherit everything which we was more than fine with. Now I have received a nasty letter from my stepmum demanding that I pay back money that my father gave me 2 years ago to put into a trust fund for my kids, which I did. She saying it doesn't matter and that I have to pay it back immediately otherwise she taking me to court for it. Can she honestly do this? 

sheslookinhot

Do not worry. No, she cannot. I’m sorry to hear of your dad’s passing.

Is it likely that  you have any old correspondence related to the money your dad gave his grandkids. Do you have any statements of the transactions from his accounts to yours. 

If you have neither it’s not a big issue.  The main thing is she has no business to try or legal recourse to request a return of the money. Stand firm.

Keep_pedalling

She has no right to demand the money back, I would bin the letter and have no more contact with her. 

Highlandchick

sheslookinhot said:

Do not worry. No, she cannot. I’m sorry to hear of your dad’s passing.

Is it likely that  you have any old correspondence related to the money your dad gave his grandkids. Do you have any statements of the transactions from his accounts to yours. 

If you have neither it’s not a big issue.  The main thing is she has no business to try or legal recourse to request a return of the money. Stand firm.

Ive got my bank statement where he put money into my account and also me transferring it into my kids trust fund accounts. 

fatbelly

As executor she has a duty to finalise his estate. That would include calling in any debts to the estate.

Treat this as a business exercise and respond in writing along the lines of...

'I am aware of the sum that you refer to and it is my understanding that it was given as a gift. If you have any written evidence to the contrary, please let me have sight of it'

If she can't prove it to you, she can't prove it to a court

RAS

Your dad's choice to give you money for his grandchildren was and is legitimate.

But because he did not live 7 years, the money still has to be accounted for by his executor. That does not mean that the gift is owed back to the estate. 

Anything that your dad left to his wife is exempt from IHT. Money given as gifts to other people in the last 7 years means that there may be an IHT liability, depending on the value of his estate. But the IHT is paid for by the estate as a rule.

Your stepmum may not understand the rules, or may be deliberately misrepresenting them because she wants to minimise a real IHT debt and maximise the amount she inherits.

Posters like @Keep_pedalling understand the gifting rules better than I do.

elsien

You and your stepmother are both grieving and people don’t always behave rationally or in their normal manner at those times. 

Just reply someone’s already suggested with regards to her showing that it wasn’t a gift, and try not to take it to heart.

noitsnotme

If it was me, I would reply with “See you in court!”, but you may not want to sour whatever relationship you have with her.

silvercar

I wouldn't even reply.

Keep_pedalling

I would not engage at all, but if you do I would simply say your father gifted this money to your children so sorry it can’t be returned. 

The only possible issue with gifts made within 7 years of death is if he gave away more than £325k in which case the gifts would have an IHT liability. 

The chances of her actually taking legal action are slim but if she does engage a solicitor then you should respond to any letter from them in the same way. You don’t need proof this was a gift, but she would need a lone agreement signed by you and your father to prove it was a loan. 

fatbelly

Yes. In the event of a court claim, both sides have to prove their position.

It is possible that your father told you it was a gift, and your stepmum that it was a loan. If there is nothing in writing then the claim would probably fail.

Even though the other side may be aggressive in their manner, I would advise you to reply, in writing, keep a record, and and to be scrupulously polite in your written communications.

If it ever came in front of a judge, he/she would read this.