Probate help when assets left upon trust

helpsezza

Hi all, new here but I’m a bit stumped on the correct way forward with probate for my late mum.   

Mum left all her assets to myself and my 2 siblings UPON TRUST to provide a income for my dad. The Will created the trust. All 3 of us are trustees and executors. 

Assets ( 50% of house, tenants in common) plus other savings totals 281K. Therefore under the 325K IHT nil rate band.  

Do I need to complete a IHT400? 

Some advice says no as no IHT to pay, others say as assets left into a trust total over 250K then a IHT400 is required?

When I look at the questions on the IHT400 about trusts it implies only trusts my mum had the benefit of should be included, which is not the scenario? 

Any help much appreciated! 

Keep_pedalling

You are correct in that no IHT return is required but I am afraid this appears to be another badly thought out will. (Will writer by any chance?)

Assuming your parents were married putting a share of a house in an immediate post death interest trust is common but putting all the other assets in trust is not, it complicates things for the trustees as it creates an income earning trust that requires a lot more managing.

helpsezza

Thank you very much for your help.

So no IHT400 required, at least I can proceed with the easier probate route.

Will was written by solicitors.

I assume you mean by complications we’ll need to register the trust within 2 years of death and then report earnings yearly by the trust to HMRC? If trust generated no income (cash assets 56k) would that make life easier?

Dad has own savings and mums work pension for income.

Keep_pedalling

https://forums.moneysavingexpert.com/discussion/comment/82038448#Comment_82038448

Your father is entitled to the income from the trust so keeping the money in a non interest bearing account is not in his best interests, it also means the value is going to be reduced over the years by inflation. You can’t really leave it 2 years either if it is earning income. Personally if I was in this situation I would speak to siblings to see if they were willing to make a deed of variation to pass all the liquid assets to your father instead if into trust.

helpsezza

Thank you again! Most helpful, we will certainly look at doing a Deed of Variation to move the non house assets to my Dad.

Keeps it far more simple moving forward for the sum of money involved.