Tag Archives: home

Our home

When the joint owner of a property dies, does the property pass to the survivor?

If you own a property jointly with someone else, you may automatically become the sole owner when they die, depending upon the way in which the property is held.

If you live in a home which you own jointly with someone else, it is important to understand the type of ownership you have. This is because it will determine what happens to the property after the death of one owner.

The two types of property ownership

If a property is owned as tenants in common, then each owner has a specified share of the property. For example, a couple may choose to have 50 per cent each, or if one has contributed more to the purchase price they can agree on different shares.

When a tenant in common dies, their share of the property passes in accordance with the terms of their Will or, if they did not have a Will, then under the Rules of Intestacy to specified close family members. This means that the person living in the property will not necessarily inherit it and they may have to leave so that it can be sold.

The second type of property ownership is a joint tenancy. No share is specified and the property is deemed to belong to the owners jointly. When one of them dies, the remaining owner automatically owns the whole of the property.

This is the case, even if the deceased left a Will leaving all of their assets to someone else, because a joint tenancy interest in a property passes by the Right of Survivorship and not via a Will.

The Land Registry will need to see a certified copy of the Death Certificate to amend the Register after the death of a joint tenant, however they will not ask for a Grant of Probate, although this may still be needed for other assets that the deceased may have held. If the property is solely owned or owned by tenants in common, the Land Registry will require a Grant of Probate before they amend the Land Register.

How is my property owned?

To find out how a jointly owned property is held, you need to check the Land Registry title. The property is owned as tenants in common if the section marked ‘B: Proprietorship Register’ contains this or similar wording: ‘No disposition by a sole proprietor of the registered estate (except a trust corporation) under which capital money arises is to be registered unless authorised by an order of the court.’ If there is no restriction then ownership is as joint tenants.

Estate planning

In some cases it is advantageous to your estate for your property to be owned by way of a tenancy in common. It is still possible for someone to stay in the property after the death of the other owner by leaving them a life interest in it. Planning for the future can be a complex area and it is advisable to seek legal advice to ensure that your loved ones are provided for as you would wish.

If you would like to speak to a Wills and estate planning expert, ring us on 01243 216900 or email us at info@legalmatters.co.uk.

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Inheritance Tax planning

What is the transferable nil rate band in Inheritance Tax and how can you claim it?

When someone dies, the first £325,000 of their estate is exempt from Inheritance Tax (IHT). If they don’t use all of this allowance, it can be transferred to their spouse’s or civil partner’s estate in due course. This is known as the transferable nil rate band.

This increases the exempt amount for the partner’s estate when they die, meaning they could have a potential IHT threshold of up to £650,000.

The relevant dates

The transfer of the nil rate band can be applied for if the remaining spouse or civil partner died on or after 9 October 2007.

In respect of civil partnerships, the transferable nil rate band can be claimed only if the first partner died on or after 5 December 2005, the date that the Civil Partnership Act became law.

How much nil rate band is transferable?

Where the first spouse or partner to die leaves all of their assets to the remaining spouse or civil partner, no IHT is payable, so the entire £325,000 can be passed to the remaining spouse, subject to the deduction of any non-exempt gifts made during the previous seven years.

How to apply to transfer the nil rate band

Two forms need to be sent to HM Revenue & Customs (HMRC). The first is the standard IHT form, while the second is the application to transfer the unused allowance. There are two options for this second form.

Form IHT217 Claim to Transfer Unused Nil Rate Bank for Excepted Estates

This form should be used when the estate of the first person to die is an excepted estate, ie. IHT was not payable, for example where the estate is worth less than £325,000 or where the assets are left to charity.

Form IHT402 Claim to Transfer Unused Nil Rate Band

Where some of the £325,000 IHT allowance was used by the estate of the first spouse to die, then only the remaining balance can be transferred to benefit the second estate. Other financial information will need to be included on the form, for example gifts made within the last seven years and pension details.

Both forms need to be signed by the estate Executor or Administrator and sent to HMRC together with the main IHT form, IHT400.

A probate lawyer will be able to work out the correct figures to be included on the form, which isn’t always straightforward, for example in the case of disposal of cash or assets by the deceased prior to their death or where gifts are made to charities, which could potentially reduce IHT liability.

To speak to one of our probate specialists, call legalmatters on 01243 216900 or email us at info@legalmatters.co.uk.

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Client Testimonial

Client Testimonial…

When you lose someone you love it is always a difficult time. Having to deal with the paperwork involved in administering an estate after a death – and when you’re grieving – can be extremely upsetting.

That’s why at legalmatters we will always try to make the process as pain-free as possible for you – and why we’re always delighted to hear from a client when we’ve helped a family or an individual through such a stressful time. So thank you Jane for your kind words.

“Thank you and Megan, and all in the office staff for making my journey – sorting my dad’s estate through yourself and legalmatters – a professional, reassuring and stress free time. It’s been a pleasure and I would highly recommend you to friends.”

selling a house

Selling a home when someone has died…

When a person dies, if they owned property in their sole name this will need to be transferred to a beneficiary or sold as part of Probate. Here are some things to consider if the home needs to be sold.

Applying for a Grant of Probate

Probate is the legal process for dealing with the distribution of a person’s estate after they have died. To start the Probate process, a Grant of Representation is required. The sale of the property cannot be completed until the Grant of Probate has been issued.

Getting the property valued

It is essential to obtain a proper valuation of the property; backdated to the date of death. To ensure an accurate figure, it is a good idea to get more than one valuation.

Get the contents valued

As well as the value of the property you should also consider its contents. This will need to be valued as part of the deceased’s Estate. You should also locate and secure any valuable items in the house (e.g. jewellery, share certificates etc.).

Protecting the property

One of the first things you should do is make sure that the home is secure. Particularly if it is empty. Check that it is safely locked up, and switch off the appliances and water. You should also remove valuable items that might be at risk of theft.

Make sure the home is insured

Under some insurance policies, a home is not insured if it is left sitting empty for a certain period. Likewise, the death of the policyholder could terminate the policy. Contact the home insurance provider to inform them of the situation and find out what you should do next.

Locate the Deeds

If the property was owned for several decades, the Title might not have been registered at HM Land Registry. In such situations, you’ll need the Deeds to prove ownership.

Let the relevant organisations know

As well as the insurance provider, you should also contact anyone else involved in the property. For example, the local council and utility providers.

Instruct an estate agent and conveyancing solicitor

You can put the home on the market while you’re awaiting the Grant of Probate. But be aware that it can take 3-6 months for a Grant of Probate to be issued (even longer in more complex estates).

Prepare the home for viewings

It is always a good idea to give a home a thorough appraisal before letting viewers in. Where appropriate, consider what needs tidying, fixing etc. to showcase the property at its best.

To help you through the Probate process, speak to one of our expert team speak at legalmatters. Call us on 01243 216900 or email us at info@legalmatters.co.uk. We can take over the responsibility for you and make sure everything is carried out in line with the law, and the wishes of the deceased.

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Our house

What happens to your house when you die?

While you might think it is easy to leave your house or flat to someone you love, bequeathing property is not always as straightforward as you would think. So, how can you ensure that your home is passed on as you would like?

When someone dies and leaves behind a home, there are a few things that need to be considered. Some things you’ll need to think about include:

Is there an outstanding mortgage?

Unless insurance is in place to pay off a mortgage in full when someone dies, the monthly payment will still need to be paid. If the remaining mortgage is small, the beneficiary may be able to take on that debt. But, if there is a large mortgage outstanding, and the beneficiary cannot afford the repayments, the lender is likely to require that the home is sold.

Whether the deceased owned the legal title to the property

When someone owns a property, the legal title – registered with the Land Registry – will clearly show their name as the owner. If the property is not registered correctly, an investigation will have to take place to prove how the title passed to the deceased before it can be given to the intended beneficiary.

How the property was owned

In England and Wales, when a property is co-owned (e.g. by a husband and wife), the way it is registered will impact what happens to it when one owner dies.

There are two ways to own a property with someone else:

  • As joint tenants: This means both (or all) owners own 100% of the property. So, when someone dies their name is removed from the title and the home automatically belongs to the surviving co-owner(s).
  • As tenants in common: This means each owner owns shares in the property. These shares can be for the same, or different amounts. When someone dies, that person’s share can be left to someone other than the co-owner.

Is the property freehold or leasehold?

If a home is a leasehold, there will be an agreement from the freeholder (sometimes called the landlord) to use it for a set number of years. With a leasehold, there might be conditions on who can own or occupy the property, and this can prove problematic when leaving it in a Will.

If the property is freehold, things are more straightforward. The property and the land it is built on are owned outright and can be passed on however the deceased wished (as long as they are the sole owner).

Is there a Will in place?

If someone dies without leaving a Will, the state decides how your estate is distributed. Often this does not reflect what you wanted to happen. As such, the best way to make sure your house goes to those you want it to, is to write a Will.

For expert advice on amending or drafting a Will, speak to one of the team at legalmatters today. Call us on 01243 216900 or email us at info@legalmatters.co.uk.

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