How much money can be given to the kids?

[mrs_overall]

My sister is going through a messy divorce and is inbetween the decree nisi and the absolute. One of our relatives has just died (I'm executor) and my sis has been left �90,000 in the will. She doesn't want her ex to get wind of this. Her 3 kids (all under 10) have their own building society accounts (with sis as trustee). Can she put the inheritance into the kid's accounts? If not, how much can she legally give them?
Thanks in advance.

[themas]

She will presumably have completed Court forms about her finances as part of the divorce process. I do not know what (if anything) is on these forms about notifying any changes that occur in the finances before the divorce is complete. If there is something imposing an obligation she needs to consider carefully the possible implications (legal ones) of not complying by withholding the information on the inheritance.

How long will it be before the decree absolute? How long will it take to wind up the estate and pay out to the beneficiaries? (If you are executor you could perhaps exercise some control over the speed of this process.) It could end up that the money is not available until after the absolute decree, but I don't know whether this would make any difference to what I have said above.

In any case, it seems to me that it would be best - if you can arrange it - for the money not to be paid until after the absolute stage.

I can't see that there is any legal bar on the money going into the childrens' accounts, but does she have the power to take it out again if she wishes? She also needs to consider the tax implications of this so far as interest on the accounts is concerned.

[dancecaller]

I think you can draw up a 'deed of family agreement' to change the terms of a will, if all the beneficiaries agree (usually done to avoid inheritance tax). If she waits till it's her money, then puts it in their BS accounts the interest will be taxed at her tax rate.

She does need to think hard about whether she really wants to give this money away. Then take legal advice.

[mrs_overall]

It's now 4 weeks until the absolute. As executor I thought about delaying things but one of the other beneficiaries (our brother) is in dire need of his share. The only thing I can think of to do is physically keep hold of her cheque until after the absolute so she can say with hand on heart that she is not in possession of the money.
Many thanks for your advice themas.

[themas]

I'm not sure of your powers and duties as executor, but could you not make an interim payment to your brother (i.e. not the full amount) on the basis that the final figures had not been worked out? This could be justified by his urgent need.

Then in a few weeks time you complete the working out and issue final payments.