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Original poster

Joint account with mother as provision for probate?

48 replies

YBR · 12/05/2017 17:06

My Father died a couple of years ago and was completely in denial so had given very little thought to it. My mother is doing the opposite!
Today she suggested that She and I should have a joint account so that I would have access to pay the costs of funerals, probate, death taxes and so on.
It would be all her money in the account, but does anyone know whether there would be legal or tax implications associated with doing this?

OP posts:
IamSlave · 12/05/2017 22:03

Ok thanks, interesting! Maybe I have missed something then.

We have a pile of over due returns too, do you know which dept is responsible for this? I have the actual fines - over a grand - ...

DancingLedge · 12/05/2017 22:10

Veuve, how can there be no value in the estate if there are shares to sell?

VeuveVera · 12/05/2017 22:10

It's £425k if your passing on a home to your child

*Inheritance Tax threshold
The threshold (‘nil rate band’) is currently £325,000.

There were different thresholds in previous years - use the threshold that applied when the person died.

If the deceased left their home to their children
If the deceased left their home to their children (including adopted, foster or stepchildren) or grandchildren, their threshold increases to £425,000.

If the deceased’s partner didn’t use all their threshold
You may be able to increase the threshold by transferring any threshold that wasn’t used by a spouse or civil partner of the person who died.

You transfer the threshold when you fill in Inheritance Tax forms*

DancingLedge · 12/05/2017 22:15

I am slave, if there's tax returns not done, and consequent fines,
First, do the tax returns
Second, look up the grounds for appeal against the imposition of penalties for not doing said tax returns, and then, if you think you have grounds, appeal against imposition of said penalties.
Eg, if deceased was hospitalised, significantly I'll, and therefore not in a position to attend to their tax affairs.
All on gov.uk

DancingLedge · 12/05/2017 22:18

Veuve, broad advice without the dates at which applies will potentially seriously mislead people.

VeuveVera · 12/05/2017 22:33

Sorry, different estates Dancingledge.
Shares would form part of the estate

I've just copied that from website, I didn't write it.
Tax info is just my own experience.
I had to deal with 4 years tax teturns(not 3) and all the fine letters.hmrc were really v helpful.

DancingLedge · 12/05/2017 22:52

Yes, HMRC are not the orgres that some think.
They will help, if you're straight with them, and give them half a chance.

But, they can't advise you onIHT &CGT.

IamSlave · 12/05/2017 22:52

Dancing thanks do they make executors do tax returns? I just don't know where I would begin to find info to fill one out. I do have loads of bank statements though, sorry to be thick I guess these would be main key Confused

IamSlave · 12/05/2017 22:55

I think tax threshold is around 11thousand I don't know if state pension is counted but other pension was 200 drips and drabs of shares here and there and sporadic rent, I can't see how he got to threshold even... Certainly last few years anyway.

IamSlave · 12/05/2017 22:57

Blush sorry op just realised am hijacking your thread will do my own sorry!

VeuveVera · 12/05/2017 23:03

Slave-do you mean tax threshold to fill in a self assessment or tax threshold where income tax becomes due?
If I were you, I would phone hmrc. Wrt tax returns, you can only do your best.
I can't remember if hmrc told me to do tax returns or the accountant, who was a bit useless.

DancingLedge · 12/05/2017 23:04

I am slave, the thing is, if you are supposed to do a tax return, and you fail to do so, you get fined. Even if you didn't owe any tax.
If this is in regard to an elderly, infirm, or deceased person, please go to gov.uk. and see on what grounds you could appeal these fines.
But, officially, HMRC are not supposed to look at your appeal, until you've done the tax return. Even if there's no tax owing.

DancingLedge · 12/05/2017 23:24

And yes, one of the burdens of executors is straightening out the tax position.
Doing tax returns that should already have been done.
Appealing against fines on the elderly/incompetent.
If the estate takes too long to sort out, or, gains an"income" by earning interest, possibly an estate income tax return.Or even CGT.
Not impossible for an amateur to plough through.
I'm no advocate for giving your money to advisors and accountants.

But, if it's IHT or CGT you come into contact with, please, do yourself and everyone else a favour, get skilled advice.

Original poster
YBR · 13/05/2017 07:26

SO, before probate is granted, the executor(s) cannot get access to the estate (although funds for a funeral may be released by the bank). In order to get probate granted IHS has to be paid first.
Basically that means going to the bank and getting a loan to pay the tax to get the money on which the tax is being paid. And paying interest. Horrid.
Would IHS be liable? Almost certainly. Mum lives in an area of the SE which has ridiculously high house values. That would most likely soak up the whole of the joint IHT.

OP posts:
Original poster
YBR · 13/05/2017 09:09

Opps IHS=> IHT

OP posts:
VeuveVera · 13/05/2017 09:41

No that's not right
Probate is granted within a couple of weeks.
To get probate you have to complete forms with estimates of the estate.
Once you have probate you can deal with banks, sell house etc.
You have 6 months to pay the Inheritance tax.

IamSlave · 13/05/2017 10:05

Probate means the will is proved, it means giving you a stamped piece of paper with names of deceased and executor on. So if your bank said, we will release money for the fungal but not rest of money, they mean they need proof of Probate and that form. For shares I have to send in this Probate form before people will deal with me.

Dancer estate is way below iht threshold. And not sure what cgt is but again very little money coming in

IamSlave · 13/05/2017 10:07

No its no right what you said about going to bank to get loan etc. I have found people, organisations etc to be perfectly nice, never dealt with so many organisations in short space of time and had so many pleasant people help me!!

IamSlave · 13/05/2017 10:09

Threshold is if estate included property value is the over 325" i think. However you also note debts against esate which balances it out

Onthehighseas · 13/05/2017 10:11

Just on the point of paying funeral costs yourself because a bank account has been frozen...

It's a very simple process to pay these from a deceased person's estate. The funeral directors give you a letter, you go to the bank with that, ID and a death certificate and then they either give you a cheque there and then or post one to you. I did this last week and it took no time to sort.

PaintingByNumbers · 13/05/2017 10:14

op is right
you do sometimes need to get a loan out to pay iht
we have a joint account. it wont cover all the iht but it will just make life easier

VeuveVera · 13/05/2017 10:36

I guess it depends how long it takes
And there's evidence there that hmrc are flexible.

But you don't have to pay it when you apply for probate

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