Grandfathers will, inheritance tax and cap gains tax

[CharlieH89]

Hi everyone,
Hoping someone has the knowledge to clear up some q’s my father has thrown at me this evening. He is a beneficiary along with his two siblings and also my grandfathers wife. He doesn’t seem to be getting told much as he doesn’t live near the executor of the Will whereas my auntie does and relays the information to my father.

My grandfather had three properties. In his will it states two properties are to be sold and the proceeds to go to his three children.

- if it states in the will that they are to be sold do they have to be sold by the executor?

My father is under the impression that they might be going into their names and then sold which may affect Aunty/ uncles capital gains tax if they were to make improvements to the house and sell them.

The Will then states the third property my grandfathers wife can live in until she passes away and then the house can be sold and the proceeds go to dad/ Aunty/ uncle.
- Can she disassociate herself with this property via deed of variation in exchange for an x amount of money?
I don’t think she wants to stay at the property understandably.

The estate looks to be around £400k comprising of the 3 properties.
I’ve googled inheritance tax with the limit being £325k. As the properties are going to descendants am I right in saying no IHT will be due as the limit goes to £500k?

Or with the properties being sold as the Will states, inheritance tax will be due as the £500k only applies if the properties aren’t being sold and are being given my grandfathers children?

My father wanted to just sit back and let it all be sorted out but there’s a lot happening to which I’m being asked to Google quite a bit now to try and find out the basics of what might happen.

[CharlieH89]

rockin said:

Have the executors appointed solicitors to deal with the estate or are they trying to DIY it?

Has he actually received a copy of the Will? If not, he should ask the executors/solicitors for one.

Executors are under a legal obligation to carry out the Will as written and, if they fail to do so, will be personally liable to compensate any beneficiary who doesn't receive what they should.

Thank you for replying Rockin.
Solicitors are dealing with the will, yes.
My father has received a copy of the Will to which it states the properties are to be sold and proceeds split between the 3, I’m not too sure why he is asking questions about IHT and CGT. It was my Aunty who had put it in his head as apparently she has sold a second home this year and used some of her CGT allowance. It doesn’t affect my father.

Thank you for the example. It was as I thought and that the estate will be the one that pays and not my father.

[CharlieH89]

Crafty_ said:

On the IHT limit going from 325 to 500k, I'd question if that relates to primary property only?

That’s a good question. The solicitor who is dealing with the will has told my father he cannot answer any questions as he is a beneficiary and not the client.
The executor is my grandfathers sister who is late 70s and I think doesn’t want much to do with it all.

[CharlieH89]

Simpo Two said:

CharlieH89 said:

The solicitor who is dealing with the will has told my father he cannot answer any questions as he is a beneficiary and not the client.
The executor is my grandfathers sister who is late 70s and I think doesn’t want much to do with it all.

But the fact the executor isn't very interested suggests to me that the solicitor will manage it and charge accordingly, maybe a percentage of the estate. Never give these types an open chequebook.

Can the grandfather's sister - as she has no interest in being executor - delegate the position to another family member/s?

I think the solicitor will be dealing with it all and I guess a few would have been agreed at the start of it all.

I believe if my grandfathers sister stepped down from being the executor then it would be my grandfathers wife who would deal with it. I don’t think the executor could change it so that the my father/Aunty / uncle could be the executor?
Since the will came out my grandfathers wife has stopped speaking to my father and his siblings through no fault of their own, seems she has just cut all communication with them.

[CharlieH89]

Thank you John.
I’ll pass the information on to my father and let him know what can be done.
My Aunty is very eager to get it all sorted so it wouldn’t surprise me if she would like to take the reigns over the whole thing.