S
smh
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Hi
I am executor and the chief beneficiary of my father's estate. My mother and my two siblings have only a very minor share.I am interested in transferring some assets to the siblings but do not wish to do so directly for tax reasons. I would like my mother to invoke her legal right share to get 1/3 of the estate. She could then past this 1/3 on to her other two children allowing them to benefit from the much higher CAT threshold.
My father was the chief contributor to a number of accounts of significant value jointly held in my mother's name. These have passed by survivorship to my mother.
While reading the succession act I came across this:
116.—(1) Where a testator, during his lifetime, has made permanent provision for his spouse, whether under contract or otherwise, all property which is the subject of such provision (other than periodical payments made for her maintenance during his lifetime) shall be taken as being given in or towards satisfaction of the share as a legal right of the surviving spouse.
(2) The value of the property shall be reckoned as at the date of the making of the provision.
(3) If the value of the property is equal to or greater than the share of the spouse as a legal right, the spouse shall not be entitled to take any share as a legal right.
(4) If the value of the property is less than the share of the spouse as a legal right, the spouse shall be entitled to receive in satisfaction of such share so much only of the estate as, when added to the value of the property, is sufficient, as nearly as can be estimated, to make up the full amount of that share.
(5) This section shall apply only to a provision made before the commencement of this Act.
My question is basically whether the provisions taken to provide for my mother while he was still alive in the form of these joint accounts will have to be used in partial or full satisfaction of the legal right share. Ideally I do not want this to be the case. I want the assets for the legal right share to come from the estate. Part 5 seems to suggest that my father would have to have made these provisions before 1965 in order for them to count towards the legal right share. Is this the case and if so is there any other piece of legislation which will force me to take into account assets passing outside the estate for fulfillment of the legal right share?
I'd appreciate your opinion very much.
I am executor and the chief beneficiary of my father's estate. My mother and my two siblings have only a very minor share.I am interested in transferring some assets to the siblings but do not wish to do so directly for tax reasons. I would like my mother to invoke her legal right share to get 1/3 of the estate. She could then past this 1/3 on to her other two children allowing them to benefit from the much higher CAT threshold.
My father was the chief contributor to a number of accounts of significant value jointly held in my mother's name. These have passed by survivorship to my mother.
While reading the succession act I came across this:
116.—(1) Where a testator, during his lifetime, has made permanent provision for his spouse, whether under contract or otherwise, all property which is the subject of such provision (other than periodical payments made for her maintenance during his lifetime) shall be taken as being given in or towards satisfaction of the share as a legal right of the surviving spouse.
(2) The value of the property shall be reckoned as at the date of the making of the provision.
(3) If the value of the property is equal to or greater than the share of the spouse as a legal right, the spouse shall not be entitled to take any share as a legal right.
(4) If the value of the property is less than the share of the spouse as a legal right, the spouse shall be entitled to receive in satisfaction of such share so much only of the estate as, when added to the value of the property, is sufficient, as nearly as can be estimated, to make up the full amount of that share.
(5) This section shall apply only to a provision made before the commencement of this Act.
My question is basically whether the provisions taken to provide for my mother while he was still alive in the form of these joint accounts will have to be used in partial or full satisfaction of the legal right share. Ideally I do not want this to be the case. I want the assets for the legal right share to come from the estate. Part 5 seems to suggest that my father would have to have made these provisions before 1965 in order for them to count towards the legal right share. Is this the case and if so is there any other piece of legislation which will force me to take into account assets passing outside the estate for fulfillment of the legal right share?
I'd appreciate your opinion very much.