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Joshua
Joshua, Lawyer
Category: Law
Satisfied Customers: 25426
Experience:  LL.B (Hons), Higher Prof. Dip. Law & Practice
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As sitting tennants, my Husband, Myself, and my Mother, entered

Resolved Question:

As sitting tennants, my Husband, Myself, and my Mother, entered into a Right to Buy property, the deeds of which hold all our names. My mother has recently passed, and a will has been made. Part of the will is asking for a valuation of the property, I was under the impression that the property would automatically pass in equal shares to my husband and myself? Why then is the solicitor asking for a valuation for inheritance tax purposes?

Thank you
Elaine
Submitted: 3 years ago.
Category: Law
Expert:  Joshua replied 3 years ago.

Joshua :

Hello and thank you for your question. I will be very pleased to assist you. I'm a practicing lawyer in England with over 10 years experience.

Joshua :

Do you know if you own the property jointly as tenants in common or as joint tenants please? If you are not sure that's fine.

Joshua :

May I ask who your mother has left her share of the property to in her will?

Customer: The lease is registered to all 3 names. The wll gives the share of the property to myself.
Joshua :

Thanks. Do you know if the property is owned jointly by you all as tenants in common or as joint tenants or are you not sure?

Customer: As sitting tennants.
Joshua :

Sitting tenants are persons who rent a property but have a secure tenancy. You mention in your original question that you all bought the property under right to buy legislation. Is my understanding correct?

Joshua :

Would you like to continue?

Customer: Yes that's correct.
Joshua :

Thanks. On that basis this would mean you are property owners rather than sitting tenants.

Joshua :

From what you say you jointly own the leasehold interest in the property having bought it under right to buy. You are much better than sitting tenants - rather from what you say you are legal owners.

Customer: In this case why do I have to have the property valued for capital gains as the solicitor holding the wlll states..?
Joshua :

The position with regards XXXXX XXXXX mothers estate is that if probate is required to be obtained - because she owns one or more assets in her name which collectively amount to more than £15,000, then all of her assets including the her share of the property must be valued because a return must be submitted to HMRC which requires values to be declared.

Joshua :

If your mothers estate is worth less than £325,000 altogether then there will be no tax to pay though including no capital gains tax.

Customer: Does this then include the property which your saying I own?
Joshua :

It is possible to estimate values is the estate is worth less than £325K but it is better to obtain values where it is possible to do so particularly in the case of a property. It is easy to get a value - you can contact an estate agent telling them a little white lie that you are considering whether to go on the market in the near future and ask if they could pop round to carry out a valuation. Do not mention probate valuation. In this way they will carry out a valuation for nothing rather than a probate valuation which they will charge for .

Joshua :

If your mother is a joint owner on the deeds then she will own a share of the property and it is this share that must be reported on the probate return. From what you say her share will then pass to you

Joshua :

But if probate is required her share still needs to be valued in the above manner in order to obtain probate.

Customer: Which is what I was told. So for tax purposes would this be the total value of the property or her share in it.?
Joshua :

For inheritance tax purposes it is just her share of the property. Any inheritance she has left for you in the property will be taken capital gains tax free by you.

Joshua :

Is there anything else I can help you with?

Customer: Not right now thank you
Joshua :

If I can assist any further as the situation develops please do no hesitate to let me know.

Joshua :

If you have no further questions for now I should be very grateful if you would kindly take a moment to rate my service to you today. Your feedback is important to me. If there is anything else I can help with though please reply back to me though.

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