DIY conveyancing

[TaurusTheBull]

Hi,

I have (theoretically) the simplest of transactions to undertake, so I am doing it myself, but as always nothing is simple unless one underrakes research and enquiries...

DETAILS

My brother and I jointly (equally) inherited our late father's house. When I am in the UK, I live there. We are co-executors and have Probate. We have agreed that I buy his half off him, at the prevailing market price. There is no mortgage required. We have informed HMRC and recently paid the requisite Stamp Duty. Our father's name is still on the deeds.

QUESTIONS

I am unlikely to be back in the UK until October. Is the delay between paying SDLT and dealing with the Land Registry likely to be a problem? I have contacted them, but they seem slow to respond, and not necessarily reliable.

I presume I will become the legal owner once the Land Registry confirm that the deeds have been changed to my name. This would be the date that I would choose to pay my brother the amount agreed, and endorsed by HMRC. Is this an acceptable course of action? Without a chain, mortgage or solicitor, the concept of a fixed "completion date" seems completely arbitrary in our case, since we are ready to go as soon as the paperwork has been processed (albeit that deeds are presumably held electronically these days).

Thanks
Taurus

[pochisoldi]

Why don't you make life easier.
Pay the money for your brothers half of the house into the estate.
Distribute the estate, cash to brother, house to you.
No stamp duty (I think...) and no additional legal costs or land registry charges, simplified ID requirements when dealing with LR as well.

PochiSoldi

[TaurusTheBull]

I don't think I am making life difficult. It's merely a matter of providing the Land Registry with the appropriate paperwork (their form, proof of Probate, Death Certificate and/or Will etc).

I was questionning the process and any potential time constraints, not the method.

The Estate was dealt with months ago, and the Will specifically left the house to my brother and I in equal shares. To try and avoid that fact, or the payment of Stamp Duty, would be tantamount to tax evasion, in my book.

Taurus

[Parky]

I think you are allowed to minimise (or avoid) tax in this case (lawyers correct me if I'm wrong).

You could do this by implementing a Deed of Variation of the will (within 2 years of the death) which would leave the house to you and the equivalent cash to your brother, as suggested before.

[pochisoldi]

The Estate was dealt with months ago, and the Will specifically left the house to my brother and I in equal shares. To try and avoid that fact, or the payment of Stamp Duty, would be tantamount to tax evasion, in my book.

Taurus

Every man is entitled if he can to order his affairs so as that the tax attaching under the appropriate Acts is less than it otherwise would be. If he succeeds in ordering them so as to secure this result, then, however unappreciative the Commissioners of Inland Revenue or his fellow taxpayers may be of his ingenuity, he cannot be compelled to pay an increased tax.

Lord Tomlin (Inland Revenue Commissioners v. Duke of Westminster [1936] A.C. 1 19 TC 490.)

[TaurusTheBull]

Thanks for the suggestion, even though it didn't address my questions.

My solicitor didn't suggest a Deed Of Variation to me, but that doesn't mean that it isn't valid in our circumstances. As ever, the facts are hard to come by...

As things stand, I've paid minimal Stamp Duty. But if this can be reduced to zero, along with Land Registry charges (same principle as getting a new Driving Licence after moving house?), then I'll look into it.

One thing is for sure: whenever I have to deal with Government departments, they are invariably slow, obtuse and evasive.

Taurus

[supremetwo]

I think you are allowed to minimise (or avoid) tax in this case (lawyers correct me if I'm wrong).
You could do this by implementing a Deed of Variation of the will (within 2 years of the death) which would leave the house to you and the equivalent cash to your brother, as suggested before.

Any cash or other assets apart from the house?

If none, how would a Deed of Variation not be with reservation if cash outwith the estate was agreed to be paid to the other party?

[Parky]

I think you are allowed to minimise (or avoid) tax in this case (lawyers correct me if I'm wrong).
You could do this by implementing a Deed of Variation of the will (within 2 years of the death) which would leave the house to you and the equivalent cash to your brother, as suggested before.

Any cash or other assets apart from the house?

If none, how would a Deed of Variation not be with reservation if cash outwith the estate was agreed to be paid to the other party?

If there is no cash in the estate, then you are probably right.

[TaurusTheBull]

Hi,

I was left more than enough cash to buy my brother's half of the house at current market prices. Obviously, that's proveable, since we've gone through Probate.

Would such a swap therefore constitute a valid Deed Of Variation, and could this "Deed" simply consist of a letter, signed by my brother, that bequeathes his half of the house to me in return for half the current valuation?

Thanks
Taurus

[TaurusTheBull]

On closer inspection, I note that one of the stipulations of a Deed Of Variation is that none of the beneficiaries is compensated for what they lose.

So that is not an option and my original post still applies.

[Parky]

Hi,

I was left more than enough cash to buy my brother's half of the house at current market prices. Obviously, that's proveable, since we've gone through Probate.

Would such a swap therefore constitute a valid Deed Of Variation, and could this "Deed" simply consist of a letter, signed by my brother, that bequeathes his half of the house to me in return for half the current valuation?

Thanks
Taurus

See https://www.gov.uk/government/publicati ... klist-iov2

[TaurusTheBull]

As I said...

A WILL'S BENEFICIARY CANNOT BE COMPENSATED FOR THEIR LOSS (half of house).

End of story!

It seems that no-one knows the answer to my original question. Thanks for your help...

[PinkDalek]

As I said...

A WILL'S BENEFICIARY CANNOT BE COMPENSATED FOR THEIR LOSS (half of house).

End of story! ...

That's only relevant (my bold):

Where a variation is made and assets from outside the estate are used to compensate the original beneficiary for their loss, the variation will not be treated as if the deceased had made it.

If the property and the cash is still in the Estate, then the potential Variation is still apt or are you saying the cash you were bequeathed has already been distributed to you?

[Dod101]

I think the easiest answer to all of this especially when the OP is not living in the UK is for him to get his solicitor to sort this out or at least give his advice. Any family solicitor ought to know the procedure off the top of his head and the Govt department to deal with.

It is unclear whether the estate distribution is settled and done with. If so I doubt that a deed of variation is a goer anyway as it would mean unscrambling the distribution I assume. If it is the case that the distribution of the estate is completed you now have a relatively simple straightforward transfer of the house to the OP. However he says the house is still in the name of his father (I assume actually it is actually still in the estate legally so maybe the estate has not been wound up).

What I would do is set out what I want and ask the solicitor who was dealing with the estate to advise. It cannot be difficult but it is the procedure that matters. Deed of Variation, or simply buy the brother out and get the house registry to put his name on the title or something else?

Such questions often seem easy but there are often I suspect wrinkles that need to be sorted.

Dod

[PinkDalek]

It is unclear whether the estate distribution is settled and done with.

Yes it is unclear, that’s why I asked the question.

If so I doubt that a deed of variation is a goer anyway as it would mean unscrambling the distribution I assume

If it is unclear, how can you know a DoV isn’t a goer.

If it is the case that the distribution of the estate is completed you now have a relatively simple straightforward transfer of the house to the OP. However he says the house is still in the name of his father (I assume actually it is actually still in the estate legally so maybe the estate has not been wound up).

The distribution of the estate cannot be complete, if the house is still in it, as you then suggest.

The OP needs to be clearer on what is where. Otherwise we may all be guessing.

[TaurusTheBull]

Hi,

I'm not sure how clear you want me to be, since I wrote, in the original post, "Our father's name is still on the deeds."

I'm also not sure what constitutes a formal winding up of an estate, since all funds were redeemed before Christmas, and the beneficiaries duly paid. However, if it really is the case that a Deed Of Variation is possible, I think the fact that the house is still in my father's name must mean that the estate resolution remains incomplete.

I will not use a solicitor for such a theoretically straightforward process. As my brother (who never gets involved in any of it) simply said: "I don't know why you can't just pay me the money and me give you a receipt". Rather simplistic, since Land Registry need to be informed etc., but he has a point.

Does anybody know, if the Deed Of Variation isn't used here, whether it will be necessary for me to pay two Land Registry fees simultaneously? That is, that relating to the value of the property I am buying, immediately preceded by the 20 or 40 quid fee to change my father's name into that of my brother and I first?

I'll ask the solicitor who provided a basic service for Probate what her thoughts are.

Cheers
Taurus

[Chrysalis]

Just approaching this from a lay persons common sense here, but have you contacted the land registry and asked what the process is? I don’t actually know what else is involved in conveyancing apart from changing the ownership on the deeds.
The only flaw I can see in your brother’s straightforward approach is that the land registry may want to see the will and probate and if it specifically states that the property goes to both of you, that may be an issue without DoV.
But IANAL so may be missing something due to ignorance.

[Chrysalis]

https://www.gov.uk/update-property-records-someone-dies
Assume you’ve looked at the above (and apologies if it’s already been pointed out)
From a cursory glance, it looks like you might have to do it twice - once to carry out the wills instructions (I believe no stamp duty payable) and once to effect the private sale from you brother (stamp duty payable). But might be completely wrong.

[pochisoldi]

Just approaching this from a lay persons common sense here, but have you contacted the land registry and asked what the process is? I don’t actually know what else is involved in conveyancing apart from changing the ownership on the deeds.
The only flaw I can see in your brother’s straightforward approach is that the land registry may want to see the will and probate and if it specifically states that the property goes to both of you, that may be an issue without DoV.
But IANAL so may be missing something due to ignorance.

I think that LR's interest in the will and probate is limited to ensuring that the executor has the right to transfer the property rather than enforcing who it's transferred to. If they have identified the transferor, transferee and the title to transfer, the only thing required us that all charges/restrictions on the property have been satisfied.
/pochisoldi

[JonE]

I was left more than enough cash to buy my brother's half of the house at current market prices.

As a layman without experience of this I wonder why you couldn't (within 2 years from date of death) both agree an instrument of variation (using IOV2 checklist to help draft the letter) which leaves you the house in full at probate valuation and leaves your brother extra cash equivalent to 50% of the house's probate valuation which cash would otherwise have gone to you.

Then the executors complete the simple form (AS1) to assent the property to you personally and the administration of the estate can be completed.

I am not clear on precisely what you have already done and don't know if you are able to unwind what may already have been done. Seeking some early legal advice specific to your plans and intentions may have been helpful.

Cheers!