Probate Case Study

An example of how the probate application process can go horribly wrong when personal and financial affairs are not set up correctly.

Current Situation

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  • The main residential property was transferred from the parents to their adult child

  • This child did not have a Will or seek formal advice as to the financial implications of doing this

  • The parents continued to live in the same property

  • The parents although married, were separated

Implications

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  • The son died intestate (without having a valid Will), so the rules of intestacy would apply to the distribution of his estate, including the  parents house 

  • The parents did not pay market rent to their son after the transfer was made, exacerbating the IHT situation

  • The parents lost the Residential Nil-Rate Band and basic IHT planning tools

  • An unnecessary IHT liability arising due to implementation of this transfer without seeking proper advice

  • Loss of control of an asset by the parents

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