Brother wants his inheritance paid into his kids accounts

[renouncefifty]

My Father passed at the end of 2020 and I was named executor in the will. I was granted probate recently and have began the process of selling his property. My bother and I are joint beneficiaries in the will.

My brother is on benefits and has been for many years, he and his partner have some disabilities. My Brother has asked me to pay his share into his sons bank accounts. - I think this is his attempt to not lose his benefits.

I don't have to make any payments as yet as the flat my father owned has just gone on the market, but to be honest I'm worried that my brother is dragging me into something dodgy. I don't claim benefits and never have, the last thing I want is to commit fraud not to mention the fact if he isn't entitled due to an inheritance he really shouldn't be on benefits.

Where do I stand legally when it comes to making the payment to him once everything is wrapped up ? If I was to send the money to his kids accounts isn't that going against the will ?

Thank you in advance for any replies x

This a chance for your brother to come off benefits and away from all the financial constraints that entails. With careful investing your father's legacy can still benefit his grandchildren. Tell your brother he needs to see a financial advisor who will be best able to advise him.

He can claim disability benefits however much money he earns/inherits.

@jessstan2

OK,OK Greyhound. I was just trying to think of ways around it, musing. I have no experience of anything like this, or of benefits.

I wonder why you thought your advice would be useful, in that case? I've no experience of benefits either but I do recognise financial fraud when I see it, and I'm aware of the legal duties and responsibilities of an executor of a will. Nobody should be trying to think of "ways round" fraudulently claiming benefits.

Your DB could seek legal advice about a deed of variation.

I would not be too hasty to pay any monies out of the estate yet until all property has been sold, and the total sum raised paid into the executors account. There maybe further Bills to pay, estate agents fees, solicitors conveyancing fees, and the inland revenue will need to be informed for inheritance tax purposes, which in turn informs the DWP who pay the benefits.You cannot be sure either of the final sum raised by the sale of the property until the final completion date and exchange of contracts has taken place.
Not all benefits are means tested, Attendence allowance, Personal Independence Payment Allowance, and Contribution based ESA are not. As always though, things change, and it would be worth Checking the latest situations regarding these with the DWP.
You really do need to take some qualified Legal advice regarding this situation. Failure to act correctly can lead to allergations of fraud, even when this was down to ignorance rather than intent. The cash raised from the sale of the flat normally arrives via the conveyancing solicitor by bank transfer straight into the probate account. The final executors accounts have to be checked through and Signed off by the executor as correct. This also makes the executor personally responisible for any mistakes or discrepancies that may be uncovered in the future, intentional or not. If you employ a solicitor to do this step for you, at least you can have some peace of mind that you acted in good faith when appointing them.

@RainingBatsAndFrogs

It might be too late now, but if not a Deed of Variation could be done to make his kids beneficiaries.

No idea if this would be looked in as deprivation of assets or something.

And if the money is in the kids accounts it does belong to them.

It would definitely be deprivation of assets.

He could always say he doesn't want the money though.

Could that also be construed of deprivation of assets, the government could effectively say well if you don't need the inheritance then we can stop your benefits.... not sure how that would stand. A copy of a will can be sent for.

The op if they don't pay the money they are supposed to to the correct person then they could at a later date get into trouble for not dealing with the inheritance correctly.

Just pay the money to him, its not your issue what he does from there on in

See a lawyer.

I am due to receive a lump sum in compensation after an accident, we have been advised by our personal injury solicitor that we can set up a trust for the money (which is considerably over the benefit limit) and this is legal. We can then keep my benefits.

I don’t know if this applies to other forms of money, ie inherited money so do see a trust solicitor.

The mindset of somebody who thinks using inherited money to support themselves whilst not actually earning any income themselves is "wasting it" is sort of funny, in a surreal way.

I think a lot of it depends on your reasons for not earning income yourself. If you've simply decided that work isn't for you and you want to live off the taxpayer whilst having a big amount of savings to dip into for flash cars and exotic holidays, then I agree with you.

However, if you've ended up temporarily unemployed through no fault or planning of your own and you want to use a reasonable inheritance to help yourself back up - paying for training courses, even taking driving lessons, paying for a (modest) vehicle or tools to enable you to get back into employment again. Maybe you could use it to move to an area where you'd be much more able to find employment.

But, you're told "No, you are now a person on benefits, so you must not be enabled to use your inheritance wisely to improve your lot (including getting yourself off benefits) like anybody else receiving an inheritance (or indeed yourself receiving the same inheritance at a different time) would be able to. You must use the money to continue to live a minimal existence and then, when it's finally gone (or very much reduced), you can go back on to your minimal benefits lifestyle. On no account must you be allowed to help yourself (or the taxpayer) to improve your life and get off benefits."

Yes, I personally would consider that being forced to waste an opportunity that could otherwise help you and society in general.

Yes it will be deprivation in that case too ivykaty.

@thecognoscenti it was in the context of tax planning that I’ve got experience of a deed of variation. I wasn’t aware that this wasn’t the case in all circumstances - apologies.

If he got investigated, it would be discovered.

(Very old story from the 1980s). I distinctly remember having to hand over my bank book to the council officer when my parents had a random benefits check done. It had about 5p in it So the idea that it would be well hidden in their kids bank accounts is pretty naive anyway.

My uncle tried to do similar but found he couldn’t when it came to being paid out. He did lose his benefits due to the inheritance but he tried every way he could to get around that. 1 year later every penny ‘vanished to loan sharks’ and he was back on benefits

Apparently this is a frequent question on The Moneysaving Expert. What do some people here suggest would be a suitable amount in order to cease claiming benefits? £50k? £100k? £1m ?

But surely he can use it to live on, so he’s not losing it?

It just means that he stops getting benefits while he has the extra money, not that they actually reclaim the money!

Could you write out two cheques for him and then he can endorse them on the back to pay into a diffetent account. Actually I don't know if you can do that these days.

It's the only way I can think of at the moment to cheat us tax payers.

No you can't sign cheques over to others by endorsing the back as most cheques have been crossed with 2 lines on the front and can only be paid into the account holder named on the front

It would be classed by benefits as deprivation of assets and he would have his benefits stopped if in HB, or UC.

Why is everyone advising OP to see a lawyer? Her position as executrix of the will is clear. She is legally obliged to follow her father's wishes. She has no wriggle room.

If the brother doesn't want the money, or wants the money to go to a child, or whatever then HE should be seeing a lawyer to find out HIS position.

OP also says that her brother has been on benefits for "many years". I'm surprised the brother hasn't thought about this before.

And no, I don't think he should be allowed to keep all the money or siphon it off into children's accounts.

The DWP will know that he has been left money. I think solicitors have to report it. He is trying to act fraudulently. he should support himself now he has the means to do so. They would not lose disability benefits as they are non means teated.

@OzziePopPop

See a lawyer.

I am due to receive a lump sum in compensation after an accident, we have been advised by our personal injury solicitor that we can set up a trust for the money (which is considerably over the benefit limit) and this is legal. We can then keep my benefits.

I don’t know if this applies to other forms of money, ie inherited money so do see a trust solicitor.

Compensation money is treated differently to inheritance.

[quote VanCleefArpels]@thecognoscenti it was in the context of tax planning that I’ve got experience of a deed of variation. I wasn’t aware that this wasn’t the case in all circumstances - apologies.[/quote]
No worries!

The brother would have to have the Deed of Variation drawn up for him and the Benefits Agencies would chase him down for Deprivation of Assets - even if the inheritance passed down to the children 'legally', he will still have the benefits reduced.

@gophergordon

A deed of variation will still be seen as deprivation of assets as will paying the money straight into the kids accounts. He will be classed as still having the money. DWP can and do search through wills to see where benefit claimants have or should have received an inheritance. As executor, you have to distribute the funds as intended and your brother needs to inform the DWP if it takes him over the allowed amount in savings (you're allowed upto 16000 with benefits tapered between 6000 and 16000) if he and his partner are on PIP then this is not means tested and will not be affected, the same with tax credits and contribution based ESA and JSA. UC and income based ESA or JSA will be affected.

No, the DWP does not do that.

Op - discharge your duty as executor and pay the money to your brother. You could take legal advice but why should you? If he thinks anything can legally be done differently then he can research it. He could also read this www.chroniclelive.co.uk/news/north-east-news/benefits-cheat-failed-declare-19000-17620803