Is it too late to claim what has been sitting in the bank for nearly 25 years?
A. Stephen Pallister, tax and trusts partner at the solicitors Charles Russell, says: "In English law, the Limitation Act 1980 gives a beneficiary 12 years from the date of death to bring a claim against the deceased's assets. However, the rule does not apply to stop a beneficiary from recovering assets in the possession of the executor."
After obtaining this advice, we spent several months pursuing the matter with the Standard Bank of South Africa. Eventually, the bank told us that it held no traceable records in the name of your mother-in-law, nor did the High Court in Pretoria have any record of her death. It can only assist further if you find a copy of the will that shows the Standard Bank as the nominated executor.
Sadhna Gangai, legal manager for Standard Executors and Trustees, adds: "I doubt if Standard Bank was the executor or that the executors were South African. There is a law in South Africa that deals with how assets should be dealt with if a person dies without a valid will. It is the duty of the executor to ensure that all assets are distributed to their rightful heirs in terms of this law if there is no last will. The problem, as I see it, for the Standard Bank is how they will be able to identify accounts that might actually not exist anymore because the proper distribution might have taken place, or that were in fact dormant for 25 years. If the accounts were dormant, one would then have to establish who the rightful heirs will be according to the law of intestation (dying without a will)."
You could engage a specialist solicitor to investigate the matter further, but this looks like a waste of money given your description of the legacy as "small" and the poor likelihood of success.
Q. My current mortgage deal is about to come to an end. My current lender is the Ipswich Building Society. I need to borrow £180,000 over a 20-year term. Monthly repayments should be no more than £1,200. I will consider a fixed-rate mortgage over two years, but not five.
A. Martin Kilroy, at the independent mortgage broker Savills Private Finance, says: "Assuming that your income and credit history fit, and there is at least 10 per cent equity in the property, there are several good two-year fixed-rate deals available with no extended early repayment charges. Newcastle Building Society is offering a two-year fix at 4.22 per cent, with a £499 arrangement fee. Alliance & Leicester has a slightly more flexible two-year fix at 4.24 per cent, with a £395 arrangement fee. This deal allows overpayments of 10 per cent per annum without penalty." But Mr Kilroy recommends Savills' own fixed loan at 4.29 per cent for two years, with an arrangement fee of £599, free valuation and free legal work, or £200 cashback, which can be overpaid by 10 per cent per annum and no extended early repayment charges.
Q. My wife and I are in our seventies and are considering using our savings to buy a holiday home in this country to be used for family holidays and let out at other times to compensate for the loss of interest on our capital. To reduce the inheritance-tax liability, would it be possible for the property to be owned by our children, but with income paid to ourselves?
A. Isabella Shone, a tax specialist with the Dickinson Dees law firm, says: "You can either buy the holiday home and give it to your children, or give your children the cash and let them buy it. However, neither of these straightforward options would achieve your aim. The value of the house will fall out of your estates for inheritance tax purposes only if you survive the gift by seven years, and steer clear of the Gift with Reservation of Benefit (GROB) rules. These rules prevent you from avoiding inheritance tax by giving away property while still enjoying a benefit from it. The cash-gift route has long been the preferred option because the GROB rules do not apply to it. Unfortunately, however, the Government has recently introduced another layer of anti-avoidance rules, known as the Pre-Owned Asset Tax rules, which apply where a person has given away cash to buy a property, and subsequently occupies that property."
It is thus not possible, under the gifts with reservations rules, to pass the property on to your children on the condition that the rental income goes to you.
Q. I have had a series of very high charges from the Co-operative Bank. Four rejected debit-card transactions cost me £12 or more each. I was charged £35 for a rejected direct debit of £130, even though a cheque had been paid in that would cover the amount. I was also charged £105 for a letter being sent to me from the bank.
A. Overdrawing without a bank's authorisation can be an expensive business. The Co-operative Bank tells us that you have now reached private agreement on this dispute.
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