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Legal matters

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Original poster

Inheritance, anyone given up or passed on money?

49 replies

Comfysock · 24/04/2024 11:31

Would to hear from people who have done this.

Ive read that you have to get a letter of renunciation via a solictor.

In a nutshell...DF died, the Will stated house to be sold and split between children all named. Probate now granted so house will go on market. Younger brother age 53 lived in property with DF so now has to find somewhere to live. His share wont cover a house. So DSis wants to pass over her share to him or into the pot for him so he has more £££ to help him get a property...however it needs to be done.

Any advice from people who have done this please?

OP posts:
Peckhampalace · 24/04/2024 11:35

We have done deeds of variation a couple of times. Don't know if there is a time limit, but it's fairly straightforward to do as long as the document meets legal requirements.
From memory it needs to be signed by the people giving up part of their inheritance, the recipient and executors.
Easily done by a solicitor I would think.

Spirallingdownwards · 24/04/2024 11:37

Yes solicitor should be able to arrange a Deed of Variation quite cheaply

GU24Mum · 24/04/2024 11:37

I've seen it done on an estate I've been involved with. You need a deed of variation so it's best to get a solicitor to do that. The other option is for the person to receive their share and pass it on but that's likely to be less efficient (depending on the circs) from a tax perspective.

MILTOBE · 24/04/2024 11:39

That's very nice of your sister. Is she sure she can afford to do that?

londonmummy1966 · 24/04/2024 11:51

There are 2 ways your sister can go about this - she can renounce her share of the inheritance, in which case it goes back into the estate to be shared by the various beneficiaries, or she can do a variation of the terms of the will to pass her share to your brother. She has 2 years from the date of death to do it. I'd recommend the variation as it makes the situation clear without involving any other beneficiaries. It's possible to do this by writing a letter (there's guidance on the gov.uk website) but unless you know what you're doing it can be easy to miss out something you need to put in so I'd recommend asking a solicitor to do it - its pretty standard work for a solicitor used to dealing with wills and probate so it shouldn't cost a lot.

Original poster
Comfysock · 24/04/2024 17:08

MILTOBE · 24/04/2024 11:39

That's very nice of your sister. Is she sure she can afford to do that?

Yes she does. Had on quote of £600 +VAT to get it drafted by a solicitor

OP posts:
GiantHornets · 24/04/2024 21:03

£600 + VAT? Crikey that’s a lot.
I did a deed of variation of my father’s will myself, using the template on gov.uk. Nobody has asked to see it (I was also executor) and I have simply filed it away with the will. I paid the redirected funds to his grandchildren as DF had requested before he died

BorgQueen · 25/04/2024 21:46

Well the conveyancers will definitely need to see it otherwise they will be bound by the will to split the house sale accordingly.

22mumsynet · 25/04/2024 22:14

The options are

  1. disclaim (not renounce- this is to do with executors) the inheritance. Back into the pot. Not intended result.
  2. depending on your sisters financial position and health she could just gift the money to your brother. If her own estate is not likely to be subject to inheritance tax (she potentially has a tax free nil rate band of up to £1m depending on her circumstances) there is no real need for the gift to be via DoV. In any event if she survives the gift by 7 years, there is no IHT implications to her as the gift will be outside of her estate.
  3. if her own estate is likely to be subject to IHT then she should consider a DoV in favour of your brother. She should have this done by a solicitor specialising in this area. It is important to claim the IHT advantages of the DoV. If your brother is in any way vulnerable or has financial issues the she could consider benefiting via a trust rather than outright. £600 is actually pretty cheap for a DoV.
22mumsynet · 25/04/2024 22:16

Deadline for DoV is 2 years from date of death. Are you still within this time limit?

Original poster
Comfysock · 26/04/2024 23:32

@22mumsynet share from sale of house and a bit of money will be roughly £70,000 each. She wants to pass onto our brother so he would have around £140,000 and can use as a substancial amount for a house. Sister has no mortgage all paid off.

OP posts:
22mumsynet · 27/04/2024 07:57

So it’s the overall value of her assets when she dies that determines whether she is likely to pay IHT which determines whether or not it’s worth paying for the DOV.

TheBottomsOfMyTrousersAreRolled · 27/04/2024 08:02

Before I gave away £70k I would be asking why at 53 he was living with his dad and has no means to buy a home. Would your sister be ok with him spending the money not on a house? Going on a few fantastic holidays and renting? Buying an expensive car?

Original poster
Comfysock · 27/04/2024 08:59

TheBottomsOfMyTrousersAreRolled · 27/04/2024 08:02

Before I gave away £70k I would be asking why at 53 he was living with his dad and has no means to buy a home. Would your sister be ok with him spending the money not on a house? Going on a few fantastic holidays and renting? Buying an expensive car?

WOW! I wont and dont need to go into the tragic details of why our family is in this situation.....

OP posts:
Original poster
Comfysock · 27/04/2024 09:03

22mumsynet · 27/04/2024 07:57

So it’s the overall value of her assets when she dies that determines whether she is likely to pay IHT which determines whether or not it’s worth paying for the DOV.

Her assets Im guessing are her house which is co-owned with partner valued last year at £200k savings limited I know that.

OP posts:
Bankholidayhelp · 27/04/2024 09:17

Is she likely to get into a deprivation of assets situation? If she's given away £70k. Eg is she on means tested benefits? Is sheof am age where she is likely to need care? Has she savings she can drawn on if she needed to /good pension?

If she gives away here share and then 18 months later is unable to work and needs cash, then what happens?

Could she 'buy' a property with brother and retain partial ownership? So that she still had the benefit of an asset? It could be arranged so that brother wasn't in a similar situation to what he finds himself in now if sister was to predecease him.

Original poster
Comfysock · 27/04/2024 09:22

No she doesnt work. Her and her partner are retirement age, are very comfortable off and as she says she doesnt need it but he does. She wants to pass this over, her choice. I will help our DB a little too but have a dependant child who will inherit my share in time.

OP posts:
BuddingPeonies · 27/04/2024 09:25

Dad just passed his share of his mother's estate to 2 of his nephews. He was fairly confident of surviving another 7 years (and we will be about at 7 years by now, as it was way before covid), so Dad recieved the money as per the will, and then bank transfered it to the 2 he wanted to have the help.
I know about it, obviously the recipients know, but I don't think the other cousins in our generation are aware of what has happened.

ViscountessMelbourne · 27/04/2024 09:41

It sounds as if it would be simplest for her just to hand over the money as a gift. The two possible issues are:

Money laundering checks on the source of funds when DB buys his flat. A letter from DSis explaining the backstory behind the gift would probably be OK, but perhaps a formal Deed of Variation so he's got a really solid paper trail would make things smoother.

Risk of deprivation of assets proceedings if she does need LA funded care in the future. If she's only in her early sixties? and her husband is likewise then the chances of that particular combination of circumstances is very low. However in the extremely unlikely event that it does happen it might be less likely to cause problems if the money's been diverted by a deed of variation rather than going in and then out of her bank account.

(Yes I know that in theory a DofV is still DofA but surely it's less likely to come to a council's attention than a large sum being transferred out of the subject's bank account. I don't think there are any moral issues in thinking this way, because presumably housing vulnerable DB is in everyone's best interests, including the taxpayer.)

Original poster
Comfysock · 27/04/2024 10:04

She wants to do it legally via a deed of variation and also this just makes things run smoothly should any query arise ... the simple production of this deed will help speed things up if asked for say house purchase further down the line for my brother etc

OP posts:
Original poster
Comfysock · 27/04/2024 10:06

So with this 7 year span someone mentioned, what would happen if she gifted via a deed of variation and she died within 7 years?

OP posts:
MayYourToastLandButterSideUp · 27/04/2024 10:14

Before I gave away £70k I would be asking why at 53 he was living with his dad and has no means to buy a home

WTH? So judgemental!

presumably the sister that wants to give him her share knows why.

22mumsynet · 27/04/2024 10:55

Comfysock · 27/04/2024 10:06

So with this 7 year span someone mentioned, what would happen if she gifted via a deed of variation and she died within 7 years?

Nothing! That’s the main reason for doing a DoV. It’s treated as if the deceased made the gift to your brother for IHT purposes not your sister. But if she doesn’t have and IHT problem then may not be necessary. The deprivation of assets point is really only relevant if care needs are Imminent. If she is in her 60s and in good health is entirely different to being in you 90s and about to go into a care home which probably would be considered intentional deprivation. In any event though if she has sufficient assets to pay for her own care it’s irrelevant.

Whatevershallidowithmylife · 27/04/2024 11:06

https://www.gov.uk/alter-a-will-after-a-death
This has all the information you need. Where it says meets these conditions click there and download and complete the form then write a covering letter.

caringcarer · 27/04/2024 11:09

Comfysock · 26/04/2024 23:32

@22mumsynet share from sale of house and a bit of money will be roughly £70,000 each. She wants to pass onto our brother so he would have around £140,000 and can use as a substancial amount for a house. Sister has no mortgage all paid off.

What a little lovely sister you have. 💕