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JGM, Solicitor
Category: Scots Law
Satisfied Customers: 12069
Experience:  30 years as a practising solicitor.
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Thank you. The answers just prompt a few more clarifications

Customer Question

Thank you. The answers just prompt a few more clarifications and questions. Regarding 3: It was the Executor that sold the property just after HMRC and Sheriff's Court had been paid their Inheritance Tax. The Will had allocated the property to a relative living in NZ (whose basic details I previously provided), but she had not seen or signed, etc. anything concerning either her taking over ownership or selling it. The money is still in the family Executor's personal UK bank account, ie has not yet been transferred to the Inheritor (his mother). So in this case - what is the situation with CGT? Regarding 5: The co-Executor solicitor has already (this entire process began in January 2015) ingathered the estate, paid the agreed amount of Inheritance Tax (although I hear that some extra 'unknown to me' issue is now trying to be sorted with HMRC) and sold the property - before being dropped by the family Executor a few weeks ago to save paying the solicitor commission for handling the house sale and sold shares money - leaving the family Executor with the job of handing out cash to the Inheritors in addition to any other tasks that are required (which I believe he did not research, as it was I who advised him that final water and gas, etc. bills would also need to be finalised and paid on the sale date - and, regarding my question of Rates, this is something I believe he has also not looked into (the house was left furnished but uninhabited for 4-5 months last year, until I came to the UK to live in the house whilst putting it on the market, and also to clear it; this was concluded on the day the house sold, ie 29 March). Thus, I believe some council tax may need to be paid? The Executor has now had all the money in his own account for around a month, and has paid some of the Inheritors (including only 3/10 of what I am 'owed' so far) - but is now talking to the property inheritor about learning too late about his need to pay tax on all Inheritances, ie deducting tax from the original stated amounts in the Will - which doesn't make sense to me considering HMRC has signed off on the total estate value and already been paid. I hope to see him in person next week to ask more questions/get further clarification on what he is actually doing - but the more I know about Scottish law the more precise my questions and demands can be. If he refuses to tell me, but also refuses to hand over any more of my money that he is holding - then you're saying I can first get a Solicitor to write to him, and if this doesn't work then I can request the Court to take over? I look forward to hearing back from you again with more clarification.
Submitted: 1 year ago.
Category: Scots Law
Expert:  JGM replied 1 year ago.
If the will left the property itself to the beneficiary it should not have been sold. If it was sold then the beneficiary should get the money. There is no CGT issue as there is no capital gain between the date of inheritance and the sale presumably. The estate is due to pay council tax and bills that fall due during the administration of the estate. He should not be making payments to some beneficiaries and not others without knowing the full extent of the debts. If he does not give you the information you need then you raise an action for accounting and the court will direct him how to proceed.
Customer: replied 1 year ago.
Hi. Thank you for giving me more details. FYI I expect to now be talking to him in person tomorrow about these issues - so expect that I will likely have a few final follow-up situational clarifications and questions for you after this. Then I will rate.
Customer: replied 1 year ago.
Actually, after re-reading your 2 replies, I have a few more questions to ask to get clarification on prior to speaking to the family Executor. They are:1. Regarding Inheritance Tax - so if Confirmation was obtained some weeks ago from HMRC and Sheriff's Court, would it be the case that, for example, the Will's beneficiary of a stated 20K inheritance is given the full 20K, or would it be the Executor's job to calculate, deduct and pay a percentage of tax and then give the beneficiary a tax-deducted amount?2. Regarding beneficiaries having "no automatic right to see the HMRC documents" - so on what grounds could one of them apply to see them, and via what legal procedure?3. Regarding estate wind up timeframes - the estate is now all cash (apart from some shares being kept by the Beneficiary Executor for himself, instead of him taking his allocated Inheritance fully in cash). All the money (including the house sale money) went directly into his private bank account for dispersing (at his instruction, after he 'dropped' the co-Executing Solicitor in order to save paying her a percentage of the cash when it transited to him via the company's bank account and if she was paid to be kept on to disperse the beneficiaries' funds). The cash amount sitting there exceeds the Will's specific inheritance instructions (meaning that the Will stated that any left over cash was to be split 3 ways between we 3 family members after all inheritances were paid out and bills were paid) - so there should be no issues regarding debts (although I am still unsure as to whether he has checked out Council Rate bills, or yet paid the final electricity and gas bills, plus due to it being me who had to clear the house and put it on the market, including myself having to purchase the House Report, pay house insurance, etc - and he has not yet asked for my invoices to re-pay me either - plus I believe some issue has recently arisen with HMRC of which I have no knowledge - although depending on your answer to Question 1, it could be related to that). Anyhow, my next plan is to send an email to him, pointing out that he has now had around 21 business days to pay me my Inheritance (of which he has paid 3/10 of it to me via 2 transfers) - and giving him a deadline (8 business days hence, giving him 2 working days for every necessary maximum daily transfer that he can make) by which he needs to/should/must pay me my legal remainder in full. And if he ignores this, my plan was to get a lawyer in Scotland to send him a formal request/instruction that references the potential engagement of the Sheriff's Court should he also ignore this. Does this sound like the best legal approach?4. One of the listed beneficiaries (half of a married couple) has recently passed away. Should his wife, in addition to receiving the cash allocated specifically to her in the Will, also be given her deceased husband's cash gift?5. Regarding the sale of the property by the Executor/s, I think I need to clarify that this was under instruction from the Will's listed beneficiary (our mother).6. With our mother's - the primary beneficiary - house sale money still sitting in the Executor's account, there is another looming potential problem. I realise that context is largely irrelevant when it comes to the law, but I will give you some anyway: due to the poor UK pound-to-NZ dollar exchange rate at the moment (and its potential to likely worsen as it gets closer to June's EU vote), the Executor has advised our mother that the money stays in his account over there as he thinks the exchange rate will probably improve later in the year. But our mother (in NZ) is rather old, so time is of the essence as far as her benefiting from any of this cash she has been bequeathed. I have advised her that nothing is certain regarding the June voting, and that while the exchange rate will likely slowly worsen as time moves towards June, a Brexit vote would in the medium term likely pull the pound down more - but a Remain vote is also only likely to increase the pound in the medium term by only a fairly small amount. She understands. So, I suggested she perhaps tell the Executor to bring over 50% of the money now for her to use, as a risk compromise - and she liked the sound of that. She will likely be requesting this when we talk to him tonight/tomorrow. If this is what she goes for then, I have 2 questions: rather than solely instructing him to do this (by a set date) verbally, would it be better if she also gave him this instruction in writing and signed? Plus - what can be done if he refuses to transfer her her own money as she has instructed him/says 'maybe' - and then just doesn't do it?I think that is all for the moment.