Dear Mary…
Q. I am the only child of parents in their seventies who are not super-rich but who do own a house in Dorset worth more than the £265,000 one is allowed to inherit before the 40 per cent inheritance tax comes into play. Ideally they would hand ownership of the house over to me now in the hope that they will live for another seven years (at least!), so I can avoid paying this tax, but I feel I cannot make this suggestion to them myself. Nevertheless it is impractical not to take what steps one legally can to prevent wasting money. What do you suggest, Mary?
Name and address withheld
A. Casually mention to your parents that you have made an appointment with your own solicitor because you need to draw up your will, or amend your existing one. A chat with your solicitor will put you in a good position to then ring your parents a few days later to report — quite truthfully, as he will certainly say this — that he has recommended they consult their own solicitor with a view to taking steps to protect their estates from the payment of unnecessary taxes. You need not spell out what those steps are.
Alternatively you can tip off a firm of upmarket inheritance tax experts, asking them to write directly to your parents offering advice on this matter. In these days of targeted marketing your parents would not be surprised to receive such an unsolicited letter and will assume their dates of birth and other details will have been obtained through the electoral register. In any event they may well be grateful that they do not have to do any direct financial wrangling with you because a third party has materialised to act as a buffer between you.
Q. Partly to compensate for not being able to have children, my wife and I have bought a large beautiful farmhouse in south-west France. We view it as a home, not a holiday house (we expect to move there within a few years). Unfortunately family and friends — all with young children of varying degrees of unruliness — regard this ‘holiday home’ as up for grabs for those periods when we are not there ourselves. They also view my wife and me as having endless wealth which, alas, is not true; we’re putting our all into the property. How can we deter, without seeming offensive or selfish, the majority of people whom we don’t wish to use the place (how would they like a family moving in to their home for two weeks)? And also, how can we best communicate to those who we feel can safely use the place the fact that we would like a decent financial return, and not just payment for breakages, electricity and water? Any income from this financial black hole would be welcome.
A.C.P., East Sussex
A. Tell the undesirables that you have had to sign up with a local rental agency so you can try to raise some money to pay for the upkeep of the property and that, sadly, it will be occupied during the weeks they favour. Tell the more desirable spongers the same story except that, ‘We’ve only just had the deposit in from the people who want to take it and we haven’t banked it yet. We could always send it back and let you come instead. You wouldn’t have to pay full price, of course…’.
Comments