To not give anymore of my inheritance away and look after my own family?

[MamaByTheOcean]

Sorry if this is a long one! Just wanting a bit of a sense check as I’m AuDHD and don’t always understand what is right to do in social situations.

I sadly lost my dad to cancer last year. I also lost my mum a few years ago suddenly and I don’t have any siblings so I have inherited all his estate and am currently dealing with things. He was quite silly with spending decisions after we lost my mum as he’d never really dealt with finances and definitely was undiagnosed on the spectrum so their decent estate dwindled a lot (about half of what he had when she died) even with me trying to help and guide him.

He always reassured me he’d leave me his small bungalow and campervan but decided to sell the camper for a lot under market value (about 40% of the £90k paid for it a year before) when he was poorly so I didn’t have to deal with it. He also decided in his last couple months to gift his 3 siblings £60k after originally deciding on £15k for all 3 previously.

Once I started sorting his finances I paid the siblings the £60k agreed and he had less than £1000 left in his accounts which just about covered the money due for the funeral on top of his funeral plan. His will officially just left everything to me but he had expressed some wishes to me to pay approx £15k to a few charities and friends from this money in his account but there isn’t enough left. My toddler who was my dads whole world wasn’t left anything officially in the will but I am intending on giving at least £20k of my money like he left each of his siblings which will go into their savings.

Im paying £250 a month for the utilities on the property whilst waiting for a sale to go through and had to pay for insurance etc on it which is a real struggle for me at the moment as I have my own house and nursery bills etc on a part time wage so I’m having to use some of the van money. Meanwhile my dad’s siblings have bought a brand new car and been on expensive holidays with the money they’ve got. Two of them have already spent all of it in the few months since he died.

once the house is sold I’ll be left with about £160k after all fees etc. I’m really reluctant to pay the charities as I want to make sure I have a safety net for my family with the money my dad wanted me to have but I feel so guilty not paying it as per his wishes.

On top of that my husband also suggested today to gift my dads siblings a few grand holiday to thank them for helping clear the house and clean it ready for sale which I feel is a bit of a joke when they’ve already spent the large chunk of money i already gave them whilst I’m struggling month to month at the minute. I was thinking of buying them a nice afternoon tea for them all but not thousands of pounds.

just not sure if I’m being unreasonable as I’m just trying to make sure I have a bit of security for my little family and my child especially.

people come out of the woodwork when someone dies. my dad died in hospital at 4am, next day a neighbour knocked his house knowing i was there asked could they have his microwave, i was too shocked to not say yes, agreed money is a lot less, they have blown their share says its invested evan if it isnt, cheeky lot sorry for your loss

Have a feeling your father maybe lost track of finances and money and how far it would stretch and if he knew, he would give it to you!

Make some small charitable donations, gift siblings a few hundred, or a gift card for a meal at a nice restaurant (enough for drinks and food) as a thank you in your father’s memory.
I’m sorry for your loss, look after yourself and your little girl.

No more money to the siblings. They’ve had plenty. If, AFTER the estate is fully settled you feel you would like to treat them to a nice meal out or nice bottle of wine then do so. I don’t think you’re under any obligation to do so and nor should they expect it. Absolutely no need to spend more thousands on them for another holiday.
your DF asked that any monies left over in the savings count should go to charity, fine- if there is any. I’m sure his priority though was you and your ds. If this wasn’t the case he would have explicitly names charities in his Will. He didn’t, anything else is therefore rightfully yours. Perhaps again AFTER everything is settled and you see where you are, if you really do still feel you WANT to give to a charity on his behalf then you could donate a smaller monthly or annual amount for a while. That way you can be sure you aren’t leaving yourself struggling as you can always stop if your circumstances need money for yourself and child.

your parents would want to make sure you and ds are ok in the future, it’s your money, don’t feel pressured to give it away to your own detriment

If her mother was married to dad though, then the iht doubles so it won't meet the threshold

Jesus don't be giving another penny away to anyone else!

The siblings have had a huge chunk of the estate, ignore your DH, they do not need anymore for helping to clear the house, I think £20K each is more than enough for that.

This may not go down well, but I wouldn't give any to charities, a tenner to a couple if it eases your conscience but just you look up how much the CEO's of the charities you're looking at earn first. Some of them will make your eyes water.

I used to give a lot to charities, I've pretty much stopped now.

This isn't a huge estate. Just keep what's left, you deserve it by the sounds of it.

well there is enough left for the charities as you have 160k, they may just have to wait , I would have made the siblings wait too, but obviously too late for that now .
i would follow my dads wishes to the letter , wouldn’t be able to live with myself otherwise .
you’ll still be left with over 100k by sounds of things .

I would recommend that you and your family write your wishes in a will so that they are carried out. It's the only way to ensure that they're fulfilled. I also hope you follow any wishes after the bills have been paid or you're the one out of pocket.

He also decided in his last couple months to gift his 3 siblings £60k after originally deciding on £15k for all 3 previously

Can you clarify whether this was actually included in the will itself, @MamaByTheOcean?

Because if not I'm a bit unclear as to why you've given them £60k (and is that each? The way you phrased it is a bit unclear ...)

@floweruserIHT threshold goes up to £500000 if a property is left to children or grandchildren, and doubles if the OP’s mum and dad were married.

Sorry for your losses OP and don’t give any more money away. Please keep it for you and your children, and maybe a bit to charity. Your dad’s will stated everything goes to you, so that is how it should be. You’ve been very generous to your dad’s siblings.

you will find the charities pursue you for any donation stated in the will even if they have been paid it

Keep the money and look after your own. Sounds like your aunts and uncles are living it up and charities only spend a tiny fraction of their takings on good causes.

Sorry for your loss and that your dad was so financially reckless he couldn’t provide a better foundation for his grandchild. We have the same with my FIL. It’s a shame when the women go first as they’re normally more financially responsible and family-minded.

Yes, but the question is surrounding IHT on gifts the father made within 7 years of his death, not IHT on what he's left in his will.

The OP says that £60k was gifted before her father died - from what I am reading in respect of the rules around gifts of under 7 years, tax has to be paid on them.

OP says no charity or the siblings were mentioned in the actual will, it was a verbal wish her dad expressed.

Therefore, she actually has no obligation to give either away and certainly not when she is struggling financially to pay the utilities on her late dad's house.

Really, she should not have given any money away at all until the whole thing was finalised and the house was sold. Its utter madness to put yourself in a financial bind for the sake of people who weren't even named in the will

Thank the siblings with a bunch of flowers or a nice dinner out. Not money for a holiday, no way.
As for the charities.. I see why you’d be feeling uneasy about not leaving money to them. In tour position I might leave £1k or similar, divided between the charities. And then perhaps
a little more later in life when you’re in a more comfortable situation and your child is set up and settled into adult life. Not a big sum now. He’d want you to be comfortable.

I'm sorry for your loss OP. I frankly would not feel guilty about not giving the money to charity. I've worked for a major one and seen the amount of wastage that goes on.
Please don't give any more to your uncles/aunts, they have got a cheek to take anything at all from you. Usually money is passed down, not sideways. If my sibling left me money, I would insist it went to her children.
Your Dad was a little reckless in his affairs and I'm so sorry that you are having to deal with this now.

Inheritance tax would need to be paid ion the gifts, by the estate, if the total estate was worth over £1M (assuming, as the OP implies, that both deceased were married and property is passed to offspring). If doesn’t sound like the estate is worth anything like that. Therefore no inheritance tax due.

Really, she should not have given any money away at all until the whole thing was finalised.

Well this is where I'm confused, because reading the OP as I have, the £60K was given away before the father died.

If it is that the OP gifted the money after her father died, I cannot see how she could do that legally before all the money had come to her, because when my father died last year the only person who could touch his bank account was the solicitor, and only then in a very limited way.

I was his executor and the solicitor told me I could apply for other bills to be paid from the account, but there were processes for her to follow and costs involved in doings so. As such, I paid all the expenses and claimed them back when the solicitor was able to authorise the repayments.

That makes sense. It's different from what is on the government website, but fits in with other information I was reading.

Honour your dad's wishes within the financial realities. Surely his wish was not for you to be out of pocket?

Wills are normally based on percentages of the cash to avoid these situations.

You are the only beneficiary in the will. So you've essentially given his siblings £60k-180k of your own money. Why would you give your aunts and uncles a tax free gift? It's too late now, but please do some watertight estate planning for yourself, in case your partner and child are also financially naive.

First of all, I am sorry for your loss.

You have already fulfilled your Dad’s wishes towards his siblings. Once you have sorted all the financial stuff, you could put the bulk of the money into a high savings account or into ISAs.

Then after the first year, donate the interest earned to his chosen charities. That way you are fulfilling the remainder of his wishes but also securing your son’s future.

@Bonniethetiler and @GingerLiberalFeminist. If the total estate is less than the IHT tax free threshold, no IHT is due. Gifts in the 7 years prior to death are considered first so IHT is only due on gifts if the gifts themselves exceed the IHT threshold.

https://community.hmrc.gov.uk/customerforums/taxcredits/9bf11493-cb7b-ef11-a4e5-6045bd0c4d56

Sorry for your loss. Agree with not gifting the amount specified to charity. Far better going to his granddaughter. Agree in not giving a few thousand to thank siblings for helping clear the house.

A close friend of mine died last month. I am spending my bank holiday weekend in May helping to clear her flat, with her family. I am not expecting any money for this, it’s just what family and friends do. An afternoon tea is more than enough to thank them.

I'm sorry for your loss, OP. In my volunteer work I sometimes write to families to thank them for their relative having left us a bequest. It's not unusual to get a letter from the executor explaining that not enough was in the estate to fulfil all instructions e.g. care home fees, and they've divided what they did have amongst the beneficiaries. We are always just grateful that someone thought of us.
I do think that you shouldn't have gone giving out any cash sums until the whole estate was settled and priority bills and things settled.

I do think that you shouldn't have gone giving out any cash sums until the whole estate was settled and priority bills and things settled

It does read though that this may have happened before her father died.

Definitely no more to the siblings!! Maybe some to the charities as he wanted that