We are dealing with a case where we believe the attorney withdrew up to £166,000 above the likely needs of the deceased. I advised the executors that this was a debt due to the estate and we declared it as such to HMRC and paid the tax on it. This was a very large estate and there were plenty of funds to deal with it in this way.
The £166,000 was withheld from the distribution of the attorney’s share of the estate. She has sent us information as to where the money was spent (landscaping the garden, repairing the barn etc) but not why it was thought appropriate for the deceased to pay.
In our case I don’t believe the deceased had the capacity to approve the expenditure at the time it was incurred. Unless you believe that your deceased did have such capacity, and intended to make the gifts,they can’t be valid gifts since the EPA doesn’t give power to make gifts. Accordingly, the withdrawals are simply improperly made and no matter the time which has ensued, are due back to the estate. HMRC ask whether a power of attorney has been used for exactly this reason.
Amanda Freeman
Myerson