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Where Taxpayers and Advisers Meet

Tax not paid by deceased mandated beneficiary of will trust

Joined:Fri Apr 09, 2021 3:50 pm
Tax not paid by deceased mandated beneficiary of will trust

Postby Mac747 » Fri Apr 09, 2021 4:24 pm

My mother died in 2011. A 50k will trust was set up under the terms of her will, with her partner mandated to receive the income from the investments and the capital reserved for her children and grandchildren on the death of her partner. Interest and dividends were paid directly into her partner's bank account. He has now died and I am sole executor. It appears that the income was never declared (maybe averages about 2.5k a year and his personal allowance was used up by pension income) . My brother (deceased 2013) and I were trustees for the will trust but the detail of setting up the trust was done by mother's solicitor and the investment management company. My questions are:

1 Should we have registered the trust for tax
2 How far back is HMRC likely to ask us to go back
3 What kind of penalties are we likely to face
4 Would the liability come out of trust capital or out of the estate (the beneficiaries are different) - or would it fall directly on to me as trustee.
5 Does this all need to be sorted out before I can apply for probate

Grateful for any comments.

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