Making a will and putting things in trust

[Big Joe Corrigan]

Sounds a bit of a lame excuse. Mortgaged property can be put in to a Trust but you would need the permission of the lender.

She wrote to Santander, but they refused apparently.

 

[stonerblue]

Why not give them some money now whilst youre still alive?

 

[Frank the Yank]

Why not give them some money now whilst youre still alive?

How much can you give before it’s supposed to be taxed??

 

[Manc baggie]

We used the will service provided by the GMB trade union I am with. It didn’t cost anything extra.
We are not married & have step children involved, so not a straightforward mirror will.
It was conducted by a very helpful solicitor appointed by the GMB.
If you are in a union, might be a good option to use their will service.

 

[stonerblue]

How much can you give before it’s supposed to be taxed??

20k

 

[Kirkstall Blue]

How much can you give before it’s supposed to be taxed.

How much can I gift my children tax-free in the UK?


£3,000

Annual exemption

You can give away a total of £3,000 worth of gifts each tax year without them being added to the value of your estate. This is known as your 'annual exemption'. You can give gifts or money up to £3,000 to one person or split the £3,000 between several people

 

[Kirkstall Blue]

Why not give them some money now whilst youre still alive?

A balancing act between what you might need for yourself as you age “if you age” and having enough for all the everyday things white goods etc, it can cost hundreds to replace an old boiler and medical bills.

 

[denislawsbackheel]

How much can I gift my children tax-free in the UK?


£3,000

Annual exemption

You can give away a total of £3,000 worth of gifts each tax year without them being added to the value of your estate. This is known as your 'annual exemption'. You can give gifts or money up to £3,000 to one person or split the £3,000 between several people

You can give away as much as you like, an unlimited amount. As long as you live 7 years there will be no IHT to pay.
TVs Anne Robinson did that. Gave the lot to her kids to avoid IHT. £50 million!

 

[denislawsbackheel]

My solicitor told us to set up a trust to stop a situation where one of us dies, remarries, and some portion of our estate winding up with whoever that person is rather than my kiddiewinks. Is this not right? There was a cost to it but not horrific.

When you remarry your existing will becomes null and void.
So you would need a new will to stop that happening.

 

[halfmist]

When you remarry your existing will becomes null and void.
So you would need a new will to stop that happening.

Correct

 

[halfmist]

You can give away as much as you like, an unlimited amount. As long as you live 7 years there will be no IHT to pay.
TVs Anne Robinson did that. Gave the lot to her kids to avoid IHT. £50 million!

Correct but even if you do not survive the full 7 years the amount potentially liable reduces each year. If you gift an asset by what is called gift with reservation eg a house that you continue to live in the rules are more complicated. Inheritance Tax can become very complicated .

 

[halfmist]

Why not give them some money now whilst youre still alive?

It is not just money, for example it could be shares in the family company. Some are reluctant to hand over their assets whilst still alive as they are reluctant to give up control.

 

[denislawsbackheel]

Another confusion people have regards care home fees.
Councils can consider actions such as trusts to avoid them as “deprivation of assets” and disregard the arrangements.
There is no time bar for them to do this, no 7 year rule as in IHT.
So basically if they think you’ve put things in trust to avoid care fees they can consider it as part of your estate assets.
The only sure fire way of reducing this liability is to own your property as “tenants in common” where you and your partner own separate parts of your home.

 

[stonerblue]

It is not just money, for example it could be shares in the family company. Some are reluctant to hand over their assets whilst still alive as they are reluctant to give up control.

Yeah, I get all that but I find the idea of waiting til you croak before kids get inheritance a bit daft if you have the opportunity to give it them when they're young and need it.

 

[halfmist]

Yeah, I get all that but I find the idea of waiting til you croak before kids get inheritance a bit daft if you have the opportunity to give it them when they're young and need it.

I suppose it depends on a number of things, can you make the assets generate more assets,how old you are, how old the kids are, how sensible the kids are and the great unknown, how long are you going to live

 

[Blue Maverick]

Another confusion people have regards care home fees.
Councils can consider actions such as trusts to avoid them as “deprivation of assets” and disregard the arrangements.
There is no time bar for them to do this, no 7 year rule as in IHT.
So basically if they think you’ve put things in trust to avoid care fees they can consider it as part of your estate assets.
The only sure fire way of reducing this liability is to own your property as “tenants in common” where you and your partner own separate parts of your home.

This tenants in common, could you then just have a simple will that says whoever dies first is allowed to give that half to your child until the second dies where they will get it all, or if the surviving person goes into a home, only their part can be used?

 

[halfmist]

This tenants in common, could you then just have a simple will that says whoever dies first is allowed to give that half to your child until the second dies where they will get it all, or if the surviving person goes into a home, only their part can be used?

Yes, because there are two separate wills. The whole purpose is you both own part of the property. If the first person has outstanding care home fees or Local Authority debt's, if they have been paying the fees, they must come out of his Estate before any amounts are given to the kids. So not quite sure what you would be avoiding. The general rule is if you die without sufficient assets to cover your debts your debts die with you.

 

[denislawsbackheel]

This tenants in common, could you then just have a simple will that says whoever dies first is allowed to give that half to your child until the second dies where they will get it all, or if the surviving person goes into a home, only their part can be used?

That’s it in a nutshell.
The problem comes when the kids want their first half share now whilst the survivor still lives there…

 

[Kirkstall Blue]

Another confusion people have regards care home fees.
Councils can consider actions such as trusts to avoid them as “deprivation of assets” and disregard the arrangements.
There is no time bar for them to do this, no 7 year rule as in IHT.
So basically if they think you’ve put things in trust to avoid care fees they can consider it as part of your estate assets.
The only sure fire way of reducing this liability is to own your property as “tenants in common” where you and your partner own separate parts of your home.

It’s exactly seven years since our deeds were changed to tenants in common, so their won’t be any comeback, it’s a hard thing to do going from joint everything and sharing to dividing the deeds up but that’s why a solicitor is the best advice.

 

[Kompany Car]

With tenants in common does that impact the combined value of the estate that you can leave without paying IHT, which I understand is £1m if leaving to children and have combined the allowances ?

We are already giving a regular amount away, have been since my lad was 18 to minimise IHT when we eventually peg it (only 52 so a while to go hopefully), under the normal expenditure out of income rules (and yes we are keeping detailed records).