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  • FIRST POST
    • DubblyDubbly
    • By DubblyDubbly 9th Jan 18, 10:58 AM
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    DubblyDubbly
    Executor tracing Gifts for IHT
    • #1
    • 9th Jan 18, 10:58 AM
    Executor tracing Gifts for IHT 9th Jan 18 at 10:58 AM
    Hypothetical question. Now that we regularly switch bank accounts and have paperless statements what are the responsibilities of an executor get hold of 7 years of statements to see what gifts over the 3k per year have been made on an estate over the soon to be 1million IHT limit ? There is no obligation on the deceased to inform HMRC of gifts over 3k AFAIK so tracing bank accounts could be difficult.
Page 1
    • Yorkshireman99
    • By Yorkshireman99 9th Jan 18, 11:56 AM
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    Yorkshireman99
    • #2
    • 9th Jan 18, 11:56 AM
    • #2
    • 9th Jan 18, 11:56 AM
    Hypothetical question. Now that we regularly switch bank accounts and have paperless statements what are the responsibilities of an executor get hold of 7 years of statements to see what gifts over the 3k per year have been made on an estate over the soon to be 1million IHT limit ? There is no obligation on the deceased to inform HMRC of gifts over 3k AFAIK so tracing bank accounts could be difficult.
    Originally posted by DubblyDubbly
    It is up to the donor to keep accurate records of gifts made. Likewise the executor is expected to make an accurate probate application. Personally I keep a spreadsheet of all gifts made each tax year and print it off and file with my important papers. My executors are aware of this. Simples!
    • Keep pedalling
    • By Keep pedalling 9th Jan 18, 11:59 AM
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    Keep pedalling
    • #3
    • 9th Jan 18, 11:59 AM
    • #3
    • 9th Jan 18, 11:59 AM
    If you are talking about your executor, then you should take the responsibility in leaving your executor details of your last 7 years of gifting.

    I keep mine on a spreadsheet, and I send an updated copy to my solicitor once a year to be kept with our will. I also keep a paper copy in our safe with a copy of the will. Our IFA also has a copy.

    I would hate to be an executor of someone who has multiple accounts and no gift records.
    • Robin9
    • By Robin9 9th Jan 18, 12:12 PM
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    Robin9
    • #4
    • 9th Jan 18, 12:12 PM
    • #4
    • 9th Jan 18, 12:12 PM
    How would you know what you're looking for - one gift of (say)5k or 20 off 250
    Never pay on an estimated bill
    • Tom99
    • By Tom99 9th Jan 18, 12:24 PM
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    Tom99
    • #5
    • 9th Jan 18, 12:24 PM
    • #5
    • 9th Jan 18, 12:24 PM
    To be honest unless the deceased has kept records for you it will be very difficult. If the estate is in IHT level then its quite possible they have had multiple account over the past 7 years as interest rates are chased, a number of which will now be closed.

    I very much doubt whether most executors even ask for 7 years worth of the current account statements. Can a bank provide these and how much would they charge?

    How deeply you delve would probably depend on how well you knew the deceases gifting habits and also the value of the estate. For example, someone with a 5m estate is much more likely to have given away more than 3,000 pa.
    • Yorkshireman99
    • By Yorkshireman99 9th Jan 18, 12:31 PM
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    Yorkshireman99
    • #6
    • 9th Jan 18, 12:31 PM
    • #6
    • 9th Jan 18, 12:31 PM
    To be honest unless the deceased has kept records for you it will be very difficult. If the estate is in IHT level then its quite possible they have had multiple account over the past 7 years as interest rates are chased, a number of which will now be closed.

    I very much doubt whether most executors even ask for 7 years worth of the current account statements. Can a bank provide these and how much would they charge?

    How deeply you delve would probably depend on how well you knew the deceases gifting habits and also the value of the estate. For example, someone with a 5m estate is much more likely to have given away more than 3,000 pa.
    Originally posted by Tom99
    The answer is not to take the executorshp on unless you are sure adequte records exist. Another good reason to actively engage with your executor(s) before you die.
    • Keep pedalling
    • By Keep pedalling 9th Jan 18, 12:52 PM
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    Keep pedalling
    • #7
    • 9th Jan 18, 12:52 PM
    • #7
    • 9th Jan 18, 12:52 PM
    Just having multiple bank accounts is going to be a real pain. My wife had a phone call from the solicitors who handled her uncles estate and an account has come out of the woodwork 7 years after his death. It was not a small one either, over 6k after IHT has been deducted.

    We have greatly simplifies our finances. 2 bank accounts, three cash savings accounts for emergency fund, and all investments held on a single platform looked afte4 by an IFA, which should simplify our executors job greatly.
    • unforeseen
    • By unforeseen 9th Jan 18, 1:24 PM
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    unforeseen
    • #8
    • 9th Jan 18, 1:24 PM
    • #8
    • 9th Jan 18, 1:24 PM
    The answer is not to take the executorshp on unless you are sure adequte records exist. Another good reason to actively engage with your executor(s) before you die.
    Originally posted by Yorkshireman99
    However wouldn't you need to take on the executorship to get access to the records which indicate whether or not you should take on the executorship
    • Yorkshireman99
    • By Yorkshireman99 9th Jan 18, 3:36 PM
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    Yorkshireman99
    • #9
    • 9th Jan 18, 3:36 PM
    • #9
    • 9th Jan 18, 3:36 PM
    However wouldn't you need to take on the executorship to get access to the records which indicate whether or not you should take on the executorship
    Originally posted by unforeseen
    As I said before it would be unwise to agree to be executor unless you had had some dialogue with the testator before they died. Nothing forces anyone accept executorship. IMHO nobody should appoint an executor without first discussing it with them if at all possible.
    • Keep pedalling
    • By Keep pedalling 9th Jan 18, 4:20 PM
    • 5,110 Posts
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    Keep pedalling
    The answer is not to take the executorshp on unless you are sure adequte records exist. Another good reason to actively engage with your executor(s) before you die.
    Originally posted by Yorkshireman99
    A bit difficult to do if you are also one of the main beneficiaries. You could hand it over to a professional, but all that trawling through bank accounts is likely to be very expensive.

    Without decent records the job is nearly impossible to do. If any one had to do on it on ours the first problem they would hit would be who gave what as all gifts have come from our joint bank account, but not all gifts were joint. There are also a couple of gifts over the annual allowance that are also exempt, because the were given in contemplation of marriage, but the executor may not have been aware of that so they could be declared as taxable in error.
    • Yorkshireman99
    • By Yorkshireman99 9th Jan 18, 5:41 PM
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    Yorkshireman99
    Exactly! Hence the need for accurate records. If it costs the estate then that is not the executor!!!8217;s fault.
    • getmore4less
    • By getmore4less 10th Jan 18, 10:40 AM
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    getmore4less
    In the real world what happens is the executor asks potential beneficiaries of gifts if they have had any.

    As there is a significant trade off between the costs(time) of analysing 7 years of data and the likelihood of finding all the gifts is low(many won't be in the records) a more pragmatic approach is taken by the professionals.

    they will look for the big discrepancies in asset/cashflow and see if any look like gifts if they suspect there have been some, how in depth it goes will be on a case by case basis.
    • Yorkshireman99
    • By Yorkshireman99 10th Jan 18, 10:50 AM
    • 4,270 Posts
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    Yorkshireman99
    In the real world what happens is the executor asks potential beneficiaries of gifts if they have had any.

    As there is a significant trade off between the costs(time) of analysing 7 years of data and the likelihood of finding all the gifts is low(many won't be in the records) a more pragmatic approach is taken by the professionals.

    they will look for the big discrepancies in asset/cashflow and see if any look like gifts if they suspect there have been some, how in depth it goes will be on a case by case basis.
    Originally posted by getmore4less
    All very well if there is evidence that this is what the professionals actually do. What is the evidence for this? Or are you just guessing? In any case it does not seem to be something that a lay executor would want to undertake.
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