Could this hinge on the timing of the sale of the property?
The residuary estate is after the payment of all gifts,debts and expenses. If these are paid
- before the property is sold, then the property is part of the residuary estate, but if the property is
- sold before payment of gifts, etc, then there is only cash in the residuary estate, so perhaps there is no property to inherit.
Can it be argued that title in the property was never passed by the executors to the residuary beneficiary at any time and vested in the executors until the property was sold. The beneficiaries never legally owned the property or were recorded as owners at the Land registry.
Stamp Duty guidance notes are not clear on the issue but have a question:
Q16. Can I claim relief if I have previously bought a dwelling as a trustee?
A16. Yes, provided that you were not also a beneficiary of the trust and you meet the
From the guidance:
In order to count as a first time buyer, a purchaser must not, either alone or with others,
have previously acquired a major interest in a dwelling or an equivalent interest in land
situated anywhere in the world.
This includes previous acquisitions by inheritance or gift, or by a financial institution on
behalf of a person under an alternative finance scheme.
Relief is not denied by virtue of a previous acquisition as a trustee unless the purchaser was also a beneficiary of the trust.
However the ‘when’ of inheritance is not addressed. I cannot see how FTB status would be lost if the property were never owned/transferred to the beneficiaries, only the cash from the sale was transferred.
It may be that a better head than mine has already replied to this while I was composing this.
HMRC may be the best port of call to get clarification.