News1 min ago
Inheritance
27 Answers
Mr RR's aunt died a couple of years ago (in Ireland) without leaving a will. He is now entitled to approx €23000 and I believe a cheque is on it's way. Now, the aunt had a son that should, morally, receive the money, but for reasons I won't share on here, he is not entitled. Mr RR intends to send him the cash as soon as it hits our account.
Are there any tax complications for us? I know that if Mr RR dies within 7 years there will be tax to pay, but I'm presuming that will be for the cousin to settle, not Mr RR's estate, is that correct?
Are there any tax complications for us? I know that if Mr RR dies within 7 years there will be tax to pay, but I'm presuming that will be for the cousin to settle, not Mr RR's estate, is that correct?
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//Any Inheritance Tax due on gifts is usually paid by the estate//
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If a gift of money or parts of an estate is given to a relative or family member and the gift-giver dies within seven years, the individual in receipt of the gift may be taxed. This is known as the inheritance tax gifts “7-year rule”.
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'RR, I strongly advice MrRR to look at a Deed of Variation - this allows any inheritance to be re-directed to anyone he likes and avoids inheritance tax altogether'
Apparently, not possible in Ireland. It was the first thing we enquired about. The money will go straight back to the estate and get divided between the other inheritors. This we absolutely do not want as the cousin likely won't see much of it.
Apparently, not possible in Ireland. It was the first thing we enquired about. The money will go straight back to the estate and get divided between the other inheritors. This we absolutely do not want as the cousin likely won't see much of it.
I got lost with this question early on!
As the death occurred in Ireland, I can't see much point in people posting links to the intestacy rules in the UK. Those for Ireland can be found here:
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(Click on, or scroll down to, 'Cases where there is no will')
I can see nothing in that link about any circumstances under which the aunt's son could be barred from inheriting his mother's estate (or part of it, if he has siblings).
Further, if the estate does actually legally pass to the son (or to any other child/ren of the deceased, or to a grandchild whose parent is deceased) then a tax-free threshold of €335,00 applies.
Otherwise (as the estate, or a part of it) is going to a nephew of the deceased, a tax-free threshold of €32,500 applies.
So, depending upon whether there are others who're inheriting or not (i.e. upon whether the entire estate is valued at greater than €32,500 or not), there might not be any inheritance tax to pay.
With regard to Mr RR's estate, there won't be any inheritance tax to pay if he pre-deceases you and leaves everything (above the automatic £325,000 threshold) to you or to a charity. If you pre-decease him, leaving everything to him, his estate will get your allowance too, taking the threshold to £650,000. So, depending upon the value of his estate, there might not be any inheritance tax to pay at all.
Note though that the value of any gifts given during the seven years prior to Mr RR's estate, or a part thereof, will be included when assessing the value of his estate. However the first £3000 given away in any one year is discounted from the calculation. So Mr RR could give £3000 of his inheritance (if he actually does inherit anyway, which has still got me baffled!) to his aunt's son each year for about 7 years, until the €23,000 has been disposed of. He could also amend his will to ensure that, if he was to die before that period was up, his aunt's son would still get the money.
As the death occurred in Ireland, I can't see much point in people posting links to the intestacy rules in the UK. Those for Ireland can be found here:
https:/
(Click on, or scroll down to, 'Cases where there is no will')
I can see nothing in that link about any circumstances under which the aunt's son could be barred from inheriting his mother's estate (or part of it, if he has siblings).
Further, if the estate does actually legally pass to the son (or to any other child/ren of the deceased, or to a grandchild whose parent is deceased) then a tax-free threshold of €335,00 applies.
Otherwise (as the estate, or a part of it) is going to a nephew of the deceased, a tax-free threshold of €32,500 applies.
So, depending upon whether there are others who're inheriting or not (i.e. upon whether the entire estate is valued at greater than €32,500 or not), there might not be any inheritance tax to pay.
With regard to Mr RR's estate, there won't be any inheritance tax to pay if he pre-deceases you and leaves everything (above the automatic £325,000 threshold) to you or to a charity. If you pre-decease him, leaving everything to him, his estate will get your allowance too, taking the threshold to £650,000. So, depending upon the value of his estate, there might not be any inheritance tax to pay at all.
Note though that the value of any gifts given during the seven years prior to Mr RR's estate, or a part thereof, will be included when assessing the value of his estate. However the first £3000 given away in any one year is discounted from the calculation. So Mr RR could give £3000 of his inheritance (if he actually does inherit anyway, which has still got me baffled!) to his aunt's son each year for about 7 years, until the €23,000 has been disposed of. He could also amend his will to ensure that, if he was to die before that period was up, his aunt's son would still get the money.
