Inheritance

[rockyracoon]

Mr RR's aunt died a couple of years ago (in Ireland) without leaving a will. He is now entitled to approx €23000 and I believe a cheque is on it's way. Now, the aunt had a son that should, morally, receive the money, but for reasons I won't share on here, he is not entitled. Mr RR intends to send him the cash as soon as it hits our account.

Are there any tax complications for us? I know that if Mr RR dies within 7 years there will be tax to pay, but I'm presuming that will be for the cousin to settle, not Mr RR's estate, is that correct?

[Barmaid]

//I know that if Mr RR dies within 7 years there will be tax to pay, but I'm presuming that will be for the cousin to settle, not Mr RR's estate, is that correct?//

No. If Mr RR dies within 7 years the 23k will be taken off his nil rate band (currently £325k). All lifetime gifts within 7 years reduce the nrb. Once the nrb is exhausted with lifetime gifts, then the allocation of tax becomes a headache. However, this may be irrelevant if he leaves it all to you.

It may be worth exploring the issue of a Deed of Family Arrangement. I do not know enough about Irish inheritance and taxation law and cross border taxation to be able to advise on this. You could take some advice to protect your own position and then deduct the cost of that from the money you intend to pay the cousin.

I found this:- http://www.ohanlontax.ie/downloads/DisclaimersandDeedsofFamilyArrangements.pdf - but you may be out of time to do a Deed of Family Arrangement in any event.

Sorry if my answer duplicates other answers, I didn't have time to read all of them and just answered the question.

[davebro]

Just give the money & tell Mr RR he can't die just yet!

[Peter Pedant]

Is it the same as ours?
just about
they dont have ( my my I am a fast googler) the Law of Property Act 1925 - cos it was a Bruttish reform, see - but otherwise it is the same
and so....
no there are no tax complications as far as I can see on the info given.

The IHT ( Oirish) has been paid by the estate
You have no tax liability there
You will pass on the lulu as a gift
that is around £20 000
It will count as gifts on your own estate ( potential charge) for 7 y. Your allowance would be then £305 000. - that is your own lucky lucky heirs [as in a will I hope], then have only 305 000 to get thro before they ( the estate that is!) pays tax at 40%

short answer - no tax liability
get that cheque book out !

[Peter Pedant]

Barmaid has answered
forget my one

[Peter Pedant]

AND - - - OR
if you have a joint account - Mr and Mrs RR - make a note in your little book for your heirs
that Mr R has given £10 000 and and Mrs R 10 000 - then as above, but each spouse has the 325k decreased by 10 each.

oh and Bravo for givng the lu lu to the fella

[Peter Pedant]

Phew
just gone froo the other answers
stick to Barmaid's advice - she does this for a living

[rockyracoon]

Sorry I haven't responded sooner. Been a bit busy this weekend.
Thank you for all the advice. I've relayed it all to Mr RR so he can work out what is the best way to handle it.

Families eh? Who'd have em?