Probate Conundrum

[eggerb]

I am in the process of making a personal application to the Probate Office for a Grant of Administration on my father's estate. The children have decided to disclaim their inheritance in order that my mother can take the full estate. I posted on this here. I'll be getting a solicitor to write up the disclaimers and the Deed of Assent.

Here's my conundrum:

As part of the Probate process (& before the Grant issues), I need to go Revenue with the disclaimers dated before the Grant has issued. However, if I disclaim, I won't be entitled to take out the Grant. If I don't submit the disclaimers there will be no CAT due from the children but my mother will be liable for CAT in the form of gift tax.

This would seem to leave me in a position that I can't take out the Grant. The Probate Office have suggested that my mother gives power attorney to my wife and my wife takes out the Grant in my mother name. This seems very long winded. I would rather take out the Grant. Does anybody see any way around this?

 

[murphaph]

Why would your mum be liable for gift tax? When you disclaim your inheritance you don't nominate anybody to take your share. Your mum just inherits her 2/3 and the disclaimed remaining 1/3. That's the way I was told it worked anyway.

 

[mercman]

Anything passing from spouse to spouse is free of CAT

 

[eggerb]

Why would your mum be liable for gift tax? When you disclaim your inheritance you don't nominate anybody to take your share. Your mum just inherits her 2/3 and the disclaimed remaining 1/3. That's the way I was told it worked anyway.

Anything passing from spouse to spouse is free of CAT

Yes. That's what I assumed and that's why I asked Revenue why do I need to go around in circles and lodge the disclaimers with them if there would be no CAT due on the children's part as the shares will be [well] under the relevant threshold.

However, (according to the CAT section in Revenue today) if the disclaimers are not lodged correctly with them, they assume the Succession Act has been applied and there has been a 2/3, 1/3 split. If subsequently, it transpires that the assets have all been distributed to my mother, the 1/3 will be assessed as a gift to her. I suppose the law states that 1/3 is not the mother's so the Revenue (unless told otherwise) assume that the law has been applied and the children took their one third - a lay man's interpretation! Therefore, the reason in lodging the disclaimers is to clear the children of a CAT assessment and also to ensure that the 1/3 share passing to the spouse is considered to be passed as part of the estate and not as a gift after the Succession Act has been applied.

So, back to my conundrum. How do I get around this? If, I sign the disclaimer, I give up my right to extract the Grant? Assuming, the information from the Probate Office is correct viz. that the disclaimers must be lodged before the Grant issues. I'm calling Revenue tomorow to ask if they must absolutely receive the disclaimers before the Grant issues.

 

[Vanilla]

Maybe you should consult a solicitor rather than relying on the advices given on this board from complete strangers who have no personal or secondary liability to the Revenue for the CAT of all beneficiaries in this estate unlike you.