Father dies in 2009 and the will leaves estate to son and daughter equally.
Estate comprises property A - probate value at £240,000, property B (attached to A) - £60,000, Property C - £150,000, Land - £27,000.
Son has always lived in property A and so they have always felt that a 50:50 split was unfair. To this end, they have agreed that the son should have A,B and D, (total value £327K), and daughter has property C (£150,000). However, the paperwork was never done to arrange this and has only just happened (Feb 15). They are obviously way too late to do a Deed of Variation.
On paper, the daughter has made a gift of £88,500, at least based on Probate Values. I'm sure MV at date of transfer would be more. However they are only really putting into place what should have happened on death.
Have I got to declare the gift on the daughter's Tax Return? If so, do we need to get the properties revalued at Feb 15, or in the circumstances use the PV as the deemed sale proceeds? Furthermore, do we somehow have to bring in the £75K "consideration" she has received re the transfer of property C into her name or is this totally irrelevant?
Replies (5)
Please login or register to join the discussion.
You don't have to declare the gift, but in theory she's disposed of property subject to CGT and (may have) made a gain. Using probate values there's no gain, just a reallocation of the assets.
Presumably someone signed a certificate for SDLT purposes, presumably based on probate values. If this is the case, I'd use those values and ignore any gain. Others might demur.
Exactly what does the will say?
If the father left the estate to children in equal shares, that does not necessarily mean that he left half of every asset to each child, It would be quite normal to value the whole estate and instaed of selling everything for the beneficiaries to take a selection of assets balanced out by cash.
Of course if the will does say that property A is left to S & D jointly then that's different