Administration actions

Administration actions—personal representatives and the deceased's liabilities

During their lifetime a testator will enter into any number of obligations to third parties. As it is not usually possible to know precisely when you are going to die it is generally the case that a number of those obligations remain to be performed after death. The personal representatives will take the positive assets of the estate but these will be subject to the negative obligations. However, not all those obligations will fall to be concluded by the personal representatives.

Commonly found obligations are:

  1. personal contracts—these will generally cease on the death of one of the parties but there are exceptions to this rule

  2. taxation liabilities

  3. Will contracts and promises—while the promise of a gift is not effective unless made by deed, or delivered, the absence of either or both of these conditions may not be fatal

  4. partnerships obligations

There may be additional hidden liabilities such as personal guarantees, subsisting claims, company obligations and obligations as a result of Lloyds syndicate membership.

See Practice Note: Administration actions—personal representatives and the deceased's liabilities.

Administration actions—personal representatives

To view the latest version of this document and thousands of others like it, sign-in with LexisNexis or register for a free trial.

Powered by Lexis+®
Latest Private Client News

All in? Court confirms when a settlement is 'made' for the purposes of excluded property (Accuro Trust (Switzerland) SA v The Commissioners for HMRC)

Private Client analysis: This case considered the meaning of 'relevant property' under the settlements regime of the Inheritance Tax Act 1984 (IHTA 1984) and, in particular, the time at which this definition is to be tested. The question arose as to whether the trustees of an offshore trust established by a non-UK domiciled settlor were subject to the UK settlements regime in respect of property added to the trust after the settlor became deemed domiciled in the UK, or whether they were exempt from such charges as the trust consisted solely of excluded property. The First-tier Tribunal (FTT) held that whether trust property is excluded property is based on the status of the trust at the time that it was established, not at the time that the property in question was added to the settlement. As a result, the trust in this case did consist solely of excluded property and no inheritance tax (IHT) charges arose as a result of either the ten-year anniversary or capital distributions. The FTT was also asked to consider whether their jurisdiction was appellate, or supervisory only. The FTT held that, while their jurisdiction was supervisory, the questions raised by the trustees were relevant in establishing whether HMRC had acted reasonably and that the outcome (ie that the paid IHT should be refunded and that no further IHT was due) would be the same in either case. Written by Katherine Willmott, senior associate solicitor at Foot Anstey LLP.

View Private Client by content type :

Popular documents