CAT Return

Hyperbollix

Had an inheritance earlier in the year and I'm doing a CAT return with an accountant. My question is can solicitor's probate fees be written off as an expense against the estate?

Calahonda52

Is it provided for in the will?
Normally is but you need to check
In passing you know you need to make the return, its self assessment so you should not be paying anyone to make the return.
It was a substantial cash cow for accountants/lawyers prior to the move to S/A

Hyperbollix

There's no direct mention of it in the will beyond the payment of all "debts funeral and testamentary expenses" - I assume this wouldn't come under that category or would it?

I didn't actually know that about the S/A aspect. I needed advise on this as I'm trying to get tax relief on agricultural land which is leased so involved the accountant who specializes with farming work.

Calahonda52

Hyperbollix wrote: »

There's no direct mention of it in the will beyond the payment of all "debts funeral and testamentary expenses" - I assume this wouldn't come under that category or would it?

I didn't actually know that about the S/A aspect. I needed advise on this as I'm trying to get tax relief on agricultural land which is leased so involved the accountant who specializes with farming work.

No issue with the advice, but I have seen folks being stuffed for 2,500k in fees for filing the CAT return.. its on ros

don't know about testamentary expenses, I have only seen it explicitly written.
Are you an executor as well as beneficiary?

Hyperbollix

Calahonda52 wrote: »

No issue with the advice, but I have seen folks being stuffed for 2,500k in fees for filing the CAT return.. its on ros

don't know about testamentary expenses, I have only seen it explicitly written.
Are you an executor as well as beneficiary?

I am yes.

Calahonda52

Then you need to be uber careful about spending the estates money if there are other beneficiaries and the spend is not explicitly catered for in the will....

Hyperbollix

Calahonda52 wrote: »

Then you need to be uber careful about spending the estates money if there are other beneficiaries and the spend is not explicitly catered for in the will....

No worries on that score as I'm the sole beneficiary. Ill run it by the accountant and see if its a possibility.

Calahonda52

Well what it will do is reduce the taxable gain in the inheritance so if the numbers are not material it might get under the radar but it is a risk to deduct from the estate ineligible expenses from a Revenue perspective

Hyperbollix

Yes when it comes to the agricultural tax relief there's a needle to threaded with percentages as to what you inherit vs what already own vs how much of it is leased etc, so it's possible doing this may not be necessary or would over complicate things anyway, and I have been advised to keep the whole thing as simple and straightforward as possible.

Calahonda52

Hyperbollix wrote: »

Yes when it comes to the agricultural tax relief there's a needle to threaded with percentages as to what you inherit vs what already own vs how much of it is leased etc, so it's possible doing this may not be necessary or would over complicate things anyway, and I have been advised to keep the whole thing as simple and straightforward as possible.

i will leave you plough this furrow on your own

Marcusm

Calahonda52 wrote: »

Well what it will do is reduce the taxable gain in the inheritance so if the numbers are not material it might get under the radar but it is a risk to deduct from the estate ineligible expenses from a Revenue perspective

On what basis would you consider that probate expenses would not be legitimately met out of the estate in advance of the attribution of the residue. Your suggestion that it might be illegitimate or that it needs to “get under the radar” is simply laughable and unnecessarily worrying for the op. The cost of extracting probate is one of the most legitimate expenses that can be borne by the estate.

Edited to change “private” to “probate. Damn auto correct.

barneystinson

@Calahonda, this must be at least the 3rd or 4th thread in the last couple of months alone, where you have been posting incorrect advice. Please stop, I know you mean well but you are going to cost people money and/or worry them unnecessarily.

Calahonda52

barneystinson wrote: »

@Calahonda, this must be at least the 3rd or 4th thread in the last couple of months alone, where you have been posting incorrect advice. Please stop, I know you mean well but you are going to cost people money and/or worry them unnecessarily.

My direct experience of this has been that in a will where no provision was made for deducting expenses for administering the estate, the deductions were disallowed by Revenue.

If the Revenue were wrong, so be it, but that's my experience.

If that is construed as advice then thats not my problem.

Don't bother replying, I have put you on my ignore list

Marcusm

Calahonda52 wrote: »

My direct experience of this has been that in a will where no provision was made for deducting expenses for administering the estate, the deductions were disallowed by Revenue.

If the Revenue were wrong, so be it, but that's my experience.

If that is construed as advice then thats not my problem.

Don't bother replying, I have put you on my ignore list

I genuinely don’t know what you are talking about. There is not a concept of “deductions” per se in relatio to CAT. The beneficiary is taxed on the value of the inheritance they are entitled to. If the estate has debts, including those of administering the estate, then those funds are not available to fund an inheritance and the inheritance is consequently reduced and the amount upon which CAT will be charged is reduced. The estate does not pay the CAT and would not calculate a net profit or simar after deductions. Likewise, the beneficiary is entitled to what they are entitled to, they are not liable for the expense dog the estate and would not claim a “deduction” for them.

Seafóid, as my dear departed grandmother would say.