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Bit of a crappy situation

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    #11
    Yeah, I've heard two different versions:

    a)If the beneficiary dies pre-dismemberment (no idea if these are the proper terms) their share of the estate 'jumps' to whoever is next-in-line based on my grandfather's will. This would clearly be ideal since his estate is nearly wound up and would therefore not get taxed twice

    b)what they stood to inherit becomes part of their estate and is treated exactly as if they received it before dying. I wasn't aware a dead person could inherit anything though, maybe it depends where the solicitors had got to.

    However I also came across mention that you can apply for relief when there is a very short gap between deaths on grounds HMRC have already had "their bite of the cherry".

    Conflicting advice even from people who work in this area so far! As mentioned, my mother inherited my father's tax-free allowance because spouses get special exemptions. That (~600k) is what her estate is roughly worth before grandfather's estate is taken into account. His estate attracted a small amount of tax when going to her, which means ALL of it would be taxed at 40% potentially.
    Last edited by d000hg; 5 January 2016, 16:16.
    Originally posted by MaryPoppins
    I'd still not breastfeed a nazi
    Originally posted by vetran
    Urine is quite nourishing

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      #12
      Originally posted by DaveB View Post
      I'm not an expert or a lawyer, but based on this
      Probate and estate administration FAQs | Law Donut

      It would appear that the benefit from your grandfathers estate passes to you, so it never forms part of your mothers estate so would not be taxed as such.
      I read that as "if a beneficiary of the will has died when this person dies" rather than "if a beneficiary dies during the probate process".

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        #13
        Originally posted by DaveB View Post
        I'm not an expert or a lawyer, but based on this
        Probate and estate administration FAQs | Law Donut

        It would appear that the benefit from your grandfathers estate passes to you, so it never forms part of your mothers estate so would not be taxed as such.
        Unfortunately, I think that that is talking about beneficiaries that have died before the deceased. IIRC, there is often something in the will that says the beneficiary has to survive the deceased by 28 days to be a beneficiary.

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          #14
          Originally posted by DaveB View Post
          I'm not an expert or a lawyer, but based on this
          Probate and estate administration FAQs | Law Donut

          It would appear that the benefit from your grandfathers estate passes to you, so it never forms part of your mothers estate so would not be taxed as such.
          I am dubious. An executor is not neccessarily a beneficiary
          (\__/)
          (>'.'<)
          ("")("") Born to Drink. Forced to Work

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            #15
            For those interested, I was passed this by a friendly IFA which looks quite promising though I haven't read it in detail yet.

            Quick succession relief: summary
            Originally posted by MaryPoppins
            I'd still not breastfeed a nazi
            Originally posted by vetran
            Urine is quite nourishing

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              #16
              Originally posted by d000hg View Post
              For those interested, I was passed this by a friendly IFA which looks quite promising though I haven't read it in detail yet.

              Quick succession relief: summary
              Does look hopeful - let us know how it goes.

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                #17
                As the first estate is not settled surely the first thing anyone would suggest is to do a deed of variation on that will to bypass the original benefactor and send everything directly to the next generation.

                That tax relief relates to after the original estate is settled.

                What does confuse me is why is your grandfathers estate going to the sister in law. Once your father died that estate would normally go directly to the grand children
                merely at clientco for the entertainment

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                  #18
                  sorry to hear of your loss.

                  No experience of this so I'll keep my random utterances to myself.
                  Always forgive your enemies; nothing annoys them so much.

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                    #19
                    Originally posted by d000hg View Post
                    For those interested, I was passed this by a friendly IFA which looks quite promising though I haven't read it in detail yet.

                    Quick succession relief: summary
                    The relevant law is here - you need to look at section 141 at the start of chapter V.

                    (1)Where the value of a person’s estate was increased by a chargeable transfer (“the first transfer”) made not more than five years before—

                    (a)his death, or

                    (b)a chargeable transfer which is made by him otherwise than on his death and as to which the conditions specified in subsection (2) below are satisfied,

                    the tax chargeable on the value transferred by the transfer made on his death or, as the case may be, referred to in paragraph (b) above (“the later transfer”) shall be reduced by an amount calculated in accordance with subsection (3) below.
                    (2)The conditions referred to in subsection (1)(b) above are—

                    (a)that the value transferred by the later transfer falls to be determined by reference to the value of settled property in which there subsists an interest in possession to which the transferor is entitled;

                    (b)that the value transferred by the first transfer also fell to be determined by reference to the value of that property; and

                    (c)that the first transfer either was or included the making of the settlement or was made after the making of the settlement.

                    (3)The amount referred to in subsection (1) above is a percentage of the tax charged on so much of the value transferred by the first transfer as is attributable to the increase mentioned in that subsection; and the percentage is—

                    (a)100 per cent. if the period beginning with the date of the first transfer and ending with the date of the later does not exceed one year;

                    (b)80 per cent. if it exceeds one year but does not exceed two years;

                    (c)60 per cent. if it exceeds two years but does not exceed three years;

                    (d)40 per cent. if it exceeds three years but does not exceed four years; and

                    (e)20 per cent. if it exceeds four years.
                    Edit - that's clear enough: "the tax chargeable on the value transferred by the transfer made on his death or...shall be reduced by...100 per cent" so no tax to pay.
                    Last edited by TheFaQQer; 6 January 2016, 09:59.
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                      #20
                      Sorry for your loss OP, im sure this is the last thing you want to be thinking about at this time.

                      Having worked on Probate and Bereavement cases in the past, its not an uncommon issue. Usually it is the deceased's partner who passes away whilst waiting for the estate to be settled. Allowances will still apply to any deceased member, meaning the two estates go into one. I remember dealing with a young guy who had lost both of his parents and his one remaining grandparent in one car crash. All of the allowances were separated for his inheritance

                      When you are writing to HMRC, explain the situation and make sure that your solicitors arranges for your grandfathers estate to come to the next in line (hopefully you). If your solicitor says otherwise, find a new solicitor.

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