Life interest trust help

mossy26

https://forums.moneysavingexpert.com/discussion/comment/81916350#Comment_81916350

Thank you for such a detailed response. I have suggested it to the trustees, and they are concerned about the implications for me, so more thought about this is needed. It may seem like a small asset, but to my family it's a sizable amount of money, and they really want to get this right for everyone involved.

Keep_pedalling

With regards to the impact on you, don’t forget that the spending power of the capital is going to be reduced over the years by inflation, so £35k in the hand today could be worth more than £70k in 7-8 years time.

Land_Registry

Just to flag that from a registration perspective probate is not required as the legal ownership of the property does not form part of his estate. On the death of a joint owner, be they joint tenants or tenants in common, the legal ownership is dealt with as a whole and passes to the surviving joint owner to deal with.

The trust created relates to their beneficial, not legal, ownerships which can be shared/split in this way. The legal ownership is always dealt with as a whole

IF the decision is to transfer the legal ownership into the name of the trust it would be a transfer by your step-Mother to the trust as appropriate. I say 'IF' simply because this is a common scenario and there are always options to consider with regards what's 'best' for your step-Mother, trustees and beneficiaries. It's likely that was all considered when your step-Mother and Father created the life interest trust and how to protect their beneficial shares/trustees and beneficiaries.

Circumstances can though change and as such the 'IF' is certainly something to get legal/financial advice on for all parties involved - one option might be to do nothing re the legal ownership registered with us but if a transfer is the 'best' option understanding by who and to whom is a good idea for understanding and a degree of certainty for all as to what then happens for example when your step Mother dies

mossy26

https://forums.moneysavingexpert.com/discussion/comment/81916727#Comment_81916727

I was told by a solicitor that changing the name on the deed would be something I would need to arrange as executor with the trustees? I had no idea that there were other options.

This is all far more complicated than my father had realised , or had been explained to him by his solicitor.

We definitely need to get some more advice on this by the looks of things before we do anything.

mossy26

Presumably if my stepmother decides to sell and downsize then the trustees would still need to administer any residual funds from the 50%? And they are back in the position we are trying to resolve now?

Keep_pedalling

https://forums.moneysavingexpert.com/discussion/comment/81916776#Comment_81916776

If the terms of the will state that then yes.

mossy26

https://forums.moneysavingexpert.com/discussion/comment/81916835#Comment_81916835

That was what was explained to my father when the solicitor wrote it.

My stepmother is unable to make big financial decisions right at the moment, so I don't think the DOV is an option pre probate, but is there a way to do something like this further down the line once she is?

Land_Registry

https://forums.moneysavingexpert.com/discussion/comment/81916771#Comment_81916771

Changing the name on the deeds will involve transferring the legal ownership. As your step-Mother is now the surviving joint owner any change would be made by her (transfer).

His executor/beneficiaries/trustees etc all have a part to play in the discussions, options etc and in seeking the appropriate legal/financial advice re their own circumstances.

Dealing with the legal ownership, which we register, once a decision is made is the 'easy' part as a result. The complexity and wider understanding revolves around the trust, wills and the future

Keep_pedalling

https://forums.moneysavingexpert.com/discussion/comment/81916931#Comment_81916931

Unfortunately most solicitors are not trust experts especially when it comes down to management and taxation of those trusts. Deeds of variation can be made anytime within 2 years of the testators death,

mossy26

https://forums.moneysavingexpert.com/discussion/comment/81917104#Comment_81917104

https://forums.moneysavingexpert.com/discussion/comment/81916727#Comment_81916727

I'm not entirely clear on what needs to happen here now, or what our options are. Where would I best get advice on this? Given the solicitor that I have been dealing with so far (my father's) has stated that we need to transfer the deeds to the trust, I don't really understand what other options there are, let alone what is best in this situation.

I really appreciate your help with this, it's a lot more complex than any of us realised, and I feel pretty out of my depth.