Probably like many people at this present time I am suddenly more conscious of both my mortality and my responsibilities and I want to update my will but do not have a family solicitor as the one we used for decades has retired. Obviously when non-essential movement becomes possible again after this pandemic has passed and business reopen then I will go to a new solicitor and have a new will properly drawn up. But for now I am trying to draw up a document based on the wording of my previous will made over twenty years ago when my daughters were small and my wife still alive.
I want everything to go to my two daughters but I have some questions about inheritance tax. These should be clear to me after he many legal sites I have visited tonight, but I find that these sites phrase information in a way I find slightly confusing in its generality, whereas I always enjoy reading the advice given freely here by members because it directly addresses the question being directly asked.
I understand that my daughters both have inheritance threshold of €335,000 before they start to pay inheritance tax, but one younger daughter has always lived with me at home whereas the older daughter has lived abroad for several years and has a home there. I am anxious for my younger daughter to still be able to continue to live in the family house where she has always lived if anything happens to me.
Am I correct in thinking that if I leave her the house (which was worth €425,000 two months ago, although God knows what will happen to house prices in the coming months) then she will not have to pay inheritance tax on it (i.e. she would not have to raise €30,000 to pay 33% of the €90,000 price difference between her limit of €325,000 and the estimated house price of €425,000). And that this applies if:
1: The house is the only or main home of the person who died (i.e. me and I own no other property).
2: She has lived in the house as her main home for the three years before my death.
3: She does not own, have an interest or a share in any other house, including any other house acquired as part of the same inheritance (of which there would be none).
4: The house remains her main home for six years after she receives the inheritance.
This all seems clear on the various websites, but some sites give other qualifying criteria, such as stating that she must be a dependent relative of the person making the gift and must be permanently and totally incapacitated due to a physical or intellectual disability and unable to earn a living.
Am I correct in thinking that this addition stipulation only applies to a gift that I give to someone when I am still alive and does not to apply to a house inherited after I die. There was also some further stipulation on some other site about me having moved out of the house for a period of three years before my death, but again I think this may relate to a house being a gift and not an inheritance.
Sorry for the length of this post, but can I come to the two other questions that I would really welcome advice on.
1: I have some other small savings but a very good life insurance policy and so I would be able to leave my older daughter abroad the cash equivalent of the value of the house back in Ireland left to her sister. But should I state in my will that I am leaving her a sum equal to a valuation of the house, as valued by a respected independent auctioneer, or am I wiser to rule out any ambiguity by putting down an exact sum in the will (like, say, €425,000). My older daughter might be disadvantaged compared to her sister in that she will have to pay 33% on the final €90,000 on this, but perhaps she would also be advantaged in that the value of the house might fall in this climate whereas the lump sum mentioned is fixed.
2: After leaving the house to one daughter and a cash equivalent to the other daughter, there is likely to be very little left in the kitty, but if there is a small sum left in my estate, am I right in thinking that my youngest daughter will still have an untouched inheritance tax allowance that she can use to offset any addition sum that might come to her, or if she has already been left a house that is valued at more than her tax free threshold, does this mean that her tax free inheritance tax threshold has now been used up when she was left the house?
Thank you all for any advice and, yes, I do know that not only will house prices probably fluctuate wildly in the coming year but also that one of the first things the government nay cut in any new emergency budget may be the inheritance tax threshold, so all these figures may soon be out of date.
But as I have an underlying medical condition that could be affected by the coronavirus pandemic I am just trying to draw up something at short notice to cover the here and now and will get proper legal advice and a will professional drawn up when the world hopefully returns to normal. Thank you.
I want everything to go to my two daughters but I have some questions about inheritance tax. These should be clear to me after he many legal sites I have visited tonight, but I find that these sites phrase information in a way I find slightly confusing in its generality, whereas I always enjoy reading the advice given freely here by members because it directly addresses the question being directly asked.
I understand that my daughters both have inheritance threshold of €335,000 before they start to pay inheritance tax, but one younger daughter has always lived with me at home whereas the older daughter has lived abroad for several years and has a home there. I am anxious for my younger daughter to still be able to continue to live in the family house where she has always lived if anything happens to me.
Am I correct in thinking that if I leave her the house (which was worth €425,000 two months ago, although God knows what will happen to house prices in the coming months) then she will not have to pay inheritance tax on it (i.e. she would not have to raise €30,000 to pay 33% of the €90,000 price difference between her limit of €325,000 and the estimated house price of €425,000). And that this applies if:
1: The house is the only or main home of the person who died (i.e. me and I own no other property).
2: She has lived in the house as her main home for the three years before my death.
3: She does not own, have an interest or a share in any other house, including any other house acquired as part of the same inheritance (of which there would be none).
4: The house remains her main home for six years after she receives the inheritance.
This all seems clear on the various websites, but some sites give other qualifying criteria, such as stating that she must be a dependent relative of the person making the gift and must be permanently and totally incapacitated due to a physical or intellectual disability and unable to earn a living.
Am I correct in thinking that this addition stipulation only applies to a gift that I give to someone when I am still alive and does not to apply to a house inherited after I die. There was also some further stipulation on some other site about me having moved out of the house for a period of three years before my death, but again I think this may relate to a house being a gift and not an inheritance.
Sorry for the length of this post, but can I come to the two other questions that I would really welcome advice on.
1: I have some other small savings but a very good life insurance policy and so I would be able to leave my older daughter abroad the cash equivalent of the value of the house back in Ireland left to her sister. But should I state in my will that I am leaving her a sum equal to a valuation of the house, as valued by a respected independent auctioneer, or am I wiser to rule out any ambiguity by putting down an exact sum in the will (like, say, €425,000). My older daughter might be disadvantaged compared to her sister in that she will have to pay 33% on the final €90,000 on this, but perhaps she would also be advantaged in that the value of the house might fall in this climate whereas the lump sum mentioned is fixed.
2: After leaving the house to one daughter and a cash equivalent to the other daughter, there is likely to be very little left in the kitty, but if there is a small sum left in my estate, am I right in thinking that my youngest daughter will still have an untouched inheritance tax allowance that she can use to offset any addition sum that might come to her, or if she has already been left a house that is valued at more than her tax free threshold, does this mean that her tax free inheritance tax threshold has now been used up when she was left the house?
Thank you all for any advice and, yes, I do know that not only will house prices probably fluctuate wildly in the coming year but also that one of the first things the government nay cut in any new emergency budget may be the inheritance tax threshold, so all these figures may soon be out of date.
But as I have an underlying medical condition that could be affected by the coronavirus pandemic I am just trying to draw up something at short notice to cover the here and now and will get proper legal advice and a will professional drawn up when the world hopefully returns to normal. Thank you.