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IHT with no will
6 Answers
Hi,
I'm having a right nightmare trying to persuade my dad to get a will done. Not through greed but I know it would annoy him to lose any to the government.
He says IHT doesn't effect as it will all go to my mum. I know that IHT doesn't come into effect with a spose living int he uk but without a will???
With his business, house, and cash savings it will be over 350K.
Anyone got any recent horror stories i can use? ;-)
I'm having a right nightmare trying to persuade my dad to get a will done. Not through greed but I know it would annoy him to lose any to the government.
He says IHT doesn't effect as it will all go to my mum. I know that IHT doesn't come into effect with a spose living int he uk but without a will???
With his business, house, and cash savings it will be over 350K.
Anyone got any recent horror stories i can use? ;-)
Answers
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i think he is right but he should still make a will out leaving everything to your mother and in the sad event of her dying first state who it should pass on to. My aunt died recently and because her husband, who died first didnt pay cgi she was able to claim for two meaning no cgi was payable. Hope this helps but keep twisting his arm, with that amount in an estate no will presents all sorts of problems
I understand that in England if there is no will it will all go to the wife/husband.
But a will is still a good idea- it speeds things up and can be used to specify what should happen if they both die- maybe in a car accident.
I think the IHT allowance transfers over to the surviving spouse (but maybe this needs a will?), so if your dad dies first your mum would have anIHT allowance of �650000.
But a will is still a good idea- it speeds things up and can be used to specify what should happen if they both die- maybe in a car accident.
I think the IHT allowance transfers over to the surviving spouse (but maybe this needs a will?), so if your dad dies first your mum would have anIHT allowance of �650000.
It won't all go to your mum...
Married person with children
* Spouse gets everything up to *�250,000 & personal possessions.
* Anything remaining is divided into two:-
o Half to the children at 18 or earlier marriage.
o Half in trust during spouse's lifetime - he or she gets the income. On spouse's death this half goes to the children.
See here for more info: http://www.youngandpearce.co.uk/intestrules.ht m
Married person with children
* Spouse gets everything up to *�250,000 & personal possessions.
* Anything remaining is divided into two:-
o Half to the children at 18 or earlier marriage.
o Half in trust during spouse's lifetime - he or she gets the income. On spouse's death this half goes to the children.
See here for more info: http://www.youngandpearce.co.uk/intestrules.ht m
CC's answer is correct because the law in England and Wales was changed to make it so, earlier this year. So that alone is a good enough reason for your Dad to make a Will (your Mum wouldn't get all the estate).
However none of this has a bearing on IHT, because there is no IHT to pay on transfers between spouses. Where IHT would potentially be payable is in legacies picked up by any children - using the current threshold of �325k (it is called the nil rate band) as the amount that could be left before IHT would becomes payable over this figure.
However the situation doesn't stop there. There is then another IHT scenario when your Mum passes away. The Chancellor changed the rules overnight in October 2007 such that when the second partner dies, the executors of the estate are able to use any unused nil rate band from the first partner (the %age unused), as well as the full nil rate band in force at the time of the death of the second partner. The two are added togther in assessing whether IHT is payable on the estate at the death of the second partner.
The long and the short of that means that if your parents net assets between them is worth more than �650k in todays money (2 lots of �325k), IHT will very likely be payable at the death of the second partner. Some IHT planning could be useful - you should be alerting your dad to what happens after the surviving partner passes away.
However none of this has a bearing on IHT, because there is no IHT to pay on transfers between spouses. Where IHT would potentially be payable is in legacies picked up by any children - using the current threshold of �325k (it is called the nil rate band) as the amount that could be left before IHT would becomes payable over this figure.
However the situation doesn't stop there. There is then another IHT scenario when your Mum passes away. The Chancellor changed the rules overnight in October 2007 such that when the second partner dies, the executors of the estate are able to use any unused nil rate band from the first partner (the %age unused), as well as the full nil rate band in force at the time of the death of the second partner. The two are added togther in assessing whether IHT is payable on the estate at the death of the second partner.
The long and the short of that means that if your parents net assets between them is worth more than �650k in todays money (2 lots of �325k), IHT will very likely be payable at the death of the second partner. Some IHT planning could be useful - you should be alerting your dad to what happens after the surviving partner passes away.
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