Wills - does this sound right?

[gruffalohoh]

Hi All

After some advice as this may well be legit?!

My grandpa has been widowed for some years, my Mum is his only child and myself and sister his only grandchildren. He is feeling a little concerned that his wishes won't be followed so confided his intentions to me via a letter. He would like his estate to be split between Mum(50%), me(25%) and sis(25%). To achieve this, on my mum's advice he has named her as sole beneficiary and executor as this is easier for probate? She will then share out according to his wishes. Does this sound correct, she has no idea that he has shared his intentions with anyone other than her.

What would be the tax implications of this method, assuming she does as he intends? Would she pay inheritance tax on it all and then I have to pay tax on what she passes to be as I believe there is a limit on gifts you can receive before tax is due.

I am considering either discussing with her assuming my grandpa gives his blessing for me to do so or advising him to make a will which details his wishes rather than leave it to trust. Although you may tell me that this is standard practice and I can then not rock the boat.

Many thanks for any help you can give
x

[TranmereRover]

it's no easier to leave the estate to one person or two three in the clear splits as he wishes. Can't see any reason whatsoever to leave it all to one person who has no obligation to then pass it on and distribute as per his wishes. None. There's no IHT benefit either way as (assuming the estate is large enough to be chargeable), none of the beneficiaries are married to him.

[budgiegirl]

I'm no expert, but I would have thought that it would be better for your grandpa to put his intentions in his will, with your mum as executor. It shouldn't make a difference to applying to probate, the estate would just be consolidated into one holding account, and then payments made to all beneficiaries in the correct proportions once all expenses and taxes have been paid.

Also I think you may be correct that there would be tax implications if you mum is the sole beneficiary. IT would be paid on the estate when your mum inherits it. Your mum could 'gift' you and your sis your 25%, but if she dies within 7 years, then IT would be applicable again on this gift

[StrangeGlue]

If that's what he wants to happen then he needs to put it in his will. Your mum will have no obligation to pass £ on as it will all have been left to her.

[Wolfbasher]

Not a tax expert or a lawyer either. But if your granddad's estate is less than (I think) £325k, there's no IHT to pay anyway.

I think it would be better for him to write the will he wants. The executor's job is then to carry it out. Another way for him to write it would be to give your sister and you specific amounts, and then your mother the 'residue'. I think then her portion is the one that has to pay out any IHT.

[grumpyoldgitagain]

If that is what he wants to happen he needs to put it in a will

If not then whoever ends up with it is under no obligation to do any sharing out as per his wishes at all

[bryonyelf]

It has to be in his will. I'd also suggest 2 executors as well. Not just one.

[titchy]

Why did your mum suggest that to him? If he dies with no will she gets the lot with no obligation to share with you.

If he makes a will he can leave it in exactly the way he has stated he wishes.

No tax implication either way except IHT if estate worth more than £325k.

[gruffalohoh]

Thanks all. I will try to start a discussion to ensure that things are properly in place.

Titchy - he suggested making the will, she then guided him this way

Hopefully she would do as he wishes anyway but I think he would like the certainty.

[sykadelic]

Agree with everyone else saying to make sure he spells out his wishes in his Will. Giving it to her makes it HER money and she is under no legal obligation to give you anything.

Have you had a chance to talk to him yet?