Dwelling House Relief Question

[Zachary]

Hi all,

Take this scenario, two siblings are executors and beneficiaries of their aunts will, the will bequeaths their aunts entire estate to them.

The estate is made up of money and a house of approx equal value, Sibling A will qualify for Dwelling House Relief and wants to take house, Sibling B is in agreement with this and wants to take the money.

The will doesn’t specify how estate is to be split it just says bequeath entire estate to both nieces in equal shares but includes a line that if they are in agreement one can buy any asset of the estate with agreement of the other therefore sibling A plans to buy Sibling b’s half share in house and pass her half share in money to Sibling B.

The question is would Sibling A be entitled to Dwelling House Relief on full house or only on half share?

Thank you

 

[RedOnion]

includes a line that if they are in agreement one can buy any asset of the estate with agreement of the other therefore sibling A plans to buy Sibling b’s half share in house and pass her half share in money to Sibling B.

Why is she "buying" it??.
Just split the estate in equal share. One gets house. The other gets the cash. No buying. No issues with the dwelling house relief.

It might be fairer to look at an after tax position and B to get more than A as they'll be subject to CAT.

 

[Zachary]

Thank you very much for your reply, I should have explained better that would be the plan as what you suggest, one takes money and one takes house just thought Revenue may take the view both inherited half cash and half house initially and then made an arrangement between them therefore only half relief would apply to Sibling A.

In relation to your second point, I’m very curious on this but not sure I follow, what do you mean look at things in an after tax position and how could B get more than A if will states equal shares?

 

[RedOnion]

Apologies for the short reply earlier. My mind got focussed on one part of your post.

Take the will to a tax professional who can advise. The exact wording will determine if this can be done, or if revenue would view it as 50/50 split of everything. They can also advise on the tax implications of a deed of family arrangement if that's necessary.