Unadministered Nil Rate Band Discretionary Trust

The partners in my firm have are the appointed executors in the Will of the deceased. His assets include a property held as tenants-in-common with his late wife and various bank accounts/shareholdings etc. which are valued in excess of his nil rate band.

When making enquiries as to the availability of the transferable NRB, is appears the deceased’s late wife’s Will (which has not been proved) includes a Nil Rate Band Discretionary Trust. Nothing has been done by the executors of her will in terms of transferring any assets into the trust. We are making enquiries to ascertain if the deceased’s assets were inherited by way of survivorship, or if the assets should have passed into the NRBDT, but are unsure how to proceed with the administration of the estate, given there is an administered NRBDT in the will of the first spouse to die. Is the trust still classed as having come into effect despite no assets being transferred into it?

Yes, W’s assets (unless passed by survivorship) are due to the NRBDT in her Will. The assets should be valued at the date of distribution.

Regarding the transferable nil rate band, if the value of W’s estate at death is within her NRB then any unused amount can be transferred to H’s estate (as a percentage). However, H’s estate will have benefit of the full transferable residence nil rate band (assuming all the other conditions of the RNRB are met).

A Grant is also likely to be required to administer W’s estate. Further, if some of W’s other assets passed to husband then these are due back to W’s estate, which will effectively be a debt on H’s death.

Kind regards.

Ihsan Ali
I Will Solicitors Ltd