Should I update the Land Registry and if so, how?

TechDad

Evening all. When my Mum passed away a few years ago, she left her 50% share of the house she owned with my Dad (as tenants in common) in trust with my sister and I as trustees/beneficiaries.

We have not completed Form DJP and as such both of their names are still on the title, along with the standard Form A restriction to reflect the TIC.

The house is about to go on the market, and I'm wondering if we should send Form DJP off with a copy of the Death Certificate ahead of time to remove mum's name to reflect his sole legal ownership, and have him appoint me as a trustee to overreach the Form A restriction. If we did this, can we then just transfer the proceeds of the sale 50/50 to Dad's account and the Trust's account, or does the legal ownership need to mention the trustees somewhere ahead of the sale? If so, I assume Dad would need to complete form TR1 to reflect this?

Also, I'm guessing that if we don't get Mum's name removed ahead of time, then we'll need a Grant of Probate to sell the property with her name still on it, is that correct?

Keep_pedalling

There is no need to update the registry ownership can be transferred to the new owners without going through that step.

You father is actually the sole beneficial owner, legal ownership is split 50/50 with the trust, and because legal ownership did not pass to the surviving owner you are going to need probate for your mother’s estate in order to sell the house. As she died after IHT205 returns were made obsolete you won’t need to do one of those.

Land_Registry

https://forums.moneysavingexpert.com/discussion/6677258/should-i-update-the-land-registry-and-if-so-how

If I have understood correctly the property is registered in their joint names and with a form A/joint ownership restriction to protect the trust/tenants in common aspect

The legal ownership has passed to your Dad to deal with. The property does not form part of your late Mum's estate so probate is not required for her as far as the property is concerned.

The trust they created and the beneficial interest of you/your sister and Dad can all be sorted after the sale as appropriate.

If the property is to be sold your suggestion that he can appoint you as a co-trustee is a sound one and then together you both transfer the property to the buyer. By doing that the form A restriction is overreached and automatically cancelled when the buyer is registered. You conveyancer can confirm that for you and recite PG 21 section 6 for guidance - Using our forms for complex and more unusual transactions (PG21) - GOV.UK

Whilst you could apply to update the register re Mum's death there is no need. The death is sadly factual and her death certificate is sufficient proof of that fact for the buyer.

poseidon1

Just to add Form DJP is not quite relevant here since your parents did not own the property as joint tenants, they were tenants in common as indicated by you, so her half share passed to the trust on death, not too your father ( although his trusteeship is noted in this respect) .

Best to leave the pre and post sale formalities to solicitor as indicated by the LR representative above, culminating in eventual sale proceeds split between trust and father as indicated.

As regards CGT compliance on any profit since death of mother, the trust half share should continue to benefit from the main residence exemption ( via your father) assuming he has been in occupation for most of the period since your mother's death.

TechDad

Thank you all for the replies, I do appreciate you taking the time to help. The first two replies appear to contradict each other here:

Keep_pedalling: "You father is actually the sole beneficial owner, legal ownership is split 50/50 with the trust"

Land_Registry: "The legal ownership has passed to your Dad"

And the followup statements in each reply about the need for probate also support that difference with KP suggesting that probate is needed and LR suggesting it isn't.

So to add some extra detail which will hopefully make it clearer. Yes, both Mum and Dad's names were on the Land Registry Title as Registered Owners, and there was a Form A restriction with the following wording:

RESTRICTION: No disposition by a sole proprietor of the registered estate (except a trust corporation) under which capital money arises is to be registered unless authorised by an order of the court.

The trust was a Will trust (I believe called a IPDI) which gave Dad the life interest, with my sister and I as the trust beneficiaries.

I don't know if that clears anything up and helps confirm which of the above statements is actually correct. Or am I reading it wrong, are they both correct?

Thank you again, reading through, I see you both reply a lot on these forums.

poseidon1

@Keep_pedalling's suggestion is largely consistent with the preferred approach of legal professionals in dealing with IPDI trusts, in order properly protect the interests of the additional trustees (appointed under the Will) and the underlying beneficiares entitled on death of the life interest beneficiary- see discussion below:

https://trustsdiscussionforum.co.uk/t/registering-the-ipdi-against-the-property/12598/5

What the Land Registry has proposed is since all parties are at the point of an actual property disposal, then why not bypass probate entirely and leave both the appointment of additional trustees and the sale of property as a process wholly performed by the conveyancing professional in handling the sale, using the complex transactions process set out in the PG21 link provided by LR.

These are not conflicting suggestions, just different ways to 'skin the cat'.

In the case of the probate approach, this is something you can DIY but will mean you incurring costs and delays ie probate fee of £526 together with additional cost of ID1 for you to handle the TR1 transfer from father as sole owner to father and co- trustees as new joint legal owners. No Form A Restriction required, it is already on title.

What I would suggest is to obtain a quote from a solicitor as to their costs to handle the sale using the PG21 complex transaction process ( this would involve double TR1s), and their cost if you have already registered additional trustees as above, so all the conveyancer is required to do is a straight forward TR1 transfer from father/trustees to the end purchaser of the property. You can then decide which approach is time/cost effective,

Land_Registry

Bearing in mind poseidon1's post a couple of things to repeat for emphasis

Probate is not needed for Mum as far as the property is concerned. As such there's no bypassing of probate as it's not required to deal with the actual property. If probate is needed for some other reason then fine and of course an official copy of it can be used to confirm Mum's death but bear in mind you have the death certificate as evidence of that sad fact as well.

And two TR1s are not required if you are selling as Dad can appoint a co-trustee within the body of the single form TR1 used for any sale/purchase. You can do 2 TR1s but not necessary.

And whilst you can do 1 or 2 TR1s and perhaps incur extra costs I would perhaps suggest simply speaking to the conveyancer acting for you re the sale to explain the position and what you have understood from PG21. They can then advise on option(s) costs as appropriate. But I'd expect them to come down on a single TR1 inc both the appointment and sale in one transaction.

TechDad

Thank you all for your time, this has been really helpful. I appreciate all your replies and when complete I'll come back and update accordingly for anyone who finds this sometime down the line. I appreciate that other peoples mileage may vary.

Thanks again.