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Where Taxpayers and Advisers Meet

Deed of trist for property

Worriedwoman
Posts:1
Joined:Thu Jan 04, 2018 3:57 am
Deed of trist for property

Postby Worriedwoman » Thu Jan 04, 2018 4:16 am

My grandmother purchased her flat in 1990 with myself and my mum as guarantors. A solicitor set up a deed of trust between us 3 but I paid the mortgage and all expenses. My grandmother sadly died in 2000 and in her will she left the flat to myself and my mother with us as executors.' My mother refused to take her share of the flat because I had always paid the mortgage etc and so we left things as they were. Now my mother has passed away without a will and I am left wondering if I now own the flat outright through the trust or if I need to sell it and give my siblings a share of my mothers half. The flat is worth around 200k so not sure if it needs probate either.
Thanks for any advice.

someone
Posts:692
Joined:Mon Feb 13, 2017 10:09 am

Re: Deed of trist for property

Postby someone » Thu Jan 04, 2018 3:34 pm

This is a legal question not a tax question.

It will depend on the wording of your grandmother's will.

If your mother disclaimed her inheritance then it possibly should have been distributed with the residue of your grandmother's estate. If that is the case and that distribution didn't happen then that's prima facie evidence that she didn't decline the bequest.

If her declining the bequest would have meant you got her share then it doesn't say either way whether that declining actually happened.

AIUI, property transactions have to be in writing and witnessed - so I don't think she can have inherited and then given it to you without some sort of paperwork.

But I have no idea whether bequests that are declined have any sort of obligatory paperwork - obviously the executors might want something to protect themselves but I don't know if it is required.

At the very least, it sounds to me as though you're going to want a solicitor to sort out the legal title paperwork - some firms will be able to advise on probate and inheritance too. I'd suggest finding one firm that can do both.

Unfortunately, I expect that this wont be cheap as it sounds like there's some untangling of a 17 year old bequest to do. And I'm guessing some relatives in the wings who are going to want a share if at all possible so it might not be possible to turn a blind eye to irregularities.

But the fact that you, and you alone, paid the mortgage might matter - it also depends what it says in that DoT

One final thing, even if your grandmothers share came to you that would only leave you owning 2/3 unless I'm missing something along the way.

Oh, and final, final point, there's no point running up tens of thousands in legal fees on a hopeless case. However unfair it feels, if your solicitor (and maybe a second opinion) say that your mother had a share that has to be distributed under intestacy law, then moan and grumble - and even beg your siblings to make good on promises by your mother - but don't throw away what you do have chasing something you can't have. All to often these inheritance disputes that go to court end up as a battle over who will pay costs.

AGoodman
Posts:1738
Joined:Fri May 16, 2014 3:47 pm

Re: Deed of trist for property

Postby AGoodman » Thu Jan 04, 2018 6:42 pm

I agree with all the above. If no action has been taken and the property is still registered in grandmother's sole name then probate will definitely be required on her estate to transfer it to the proper owners. The fact you were guarantors suggests you were not co-owners so it could well be sole name. It may not be necessary to obtain probate for your mother's estate although this will depend on a number of factors . It is likely that some form of transfer will also be necessary or, if you all began as joint registered owners (as "tenants in common"), there could well be a restriction to remove.

You need to find and sit down with a solicitor - ideally a member of STEP (see www.step.org/member-directory). The position may not be unduly complicated but does require someone with the necessary knowledge. A lot will turn on the terms and wording of the declaration of trust - did you start with 1/3 shares and does this vary if one party pays the mortgage?

Incidentally, I am not certain on the formalities of a surrender but if your mother took any assets from grandmother's estate, she may not have been able to disclaim the rest (the general rule is all or nothing but some many wills include a provision to make this more flexible).

IHT may not be an issue but if your mother's estate was greater than £325,000 (£234,000 for grandmother, possibly including the entire property) then full accounts will have to be submitted.

Finally, you don't mention who has been living in the flat since 2000 and if it has been rented out there could be income tax implications. If thinking of selling the property, the ownership will affect who has to pay CGT and the amount payable - again depending on who owns it and who has lived there since 1990.


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