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between a solicitor and accountant...your opinion?

  • 12-11-2022 9:43am
    Registered Users Posts: 3

    Thank you all so much for this fantastic forum.

    Sadly, my partners mother passed away in 2018 and we are right at the end of the process to sell her house.

    I wanted your take on these circumstances:

    House sale closed on 17th October ‘22, yet the solicitor will not release the funds until they are happy all tax is satisfied – he is a non resident (we live in the UK).

    However, our accountant is telling us that there is no tax due now, the capital gain is due in December with the return due next year. He’s confused about what will satisfy the solicitor, as there’s no official paperwork to submit now.

    I have been bounced between the two for almost a month, whilst the solicitor has all the proceeds from the house sale.

    I flagged this potential issue to both my solicitor and accountant months before the property closed.

    What’s your view on this? Is this usual practice? I have now negotiated a partial release of funds (still waiting for that to go ahead), but it’s been an incredibly stressful few weeks.

    Thanks so much in advance for your help.


  • Registered Users Posts: 55 ✭✭relevanc

    The solicitor can not release funds until he is satisfied you have met your Irish tax obligations.

    The accountant can pay the liability in 2 weeks (Dec) and file in Jan. I hardly see the issue! You are only delayed by a matter of weeks

  • Registered Users Posts: 4,238 ✭✭✭Xander10

    What's stopping the accounting paying now?

    The 15 Dec is just the latest date without incurring a penalty for late payment

  • Registered Users Posts: 1,297 ✭✭✭Count Dracula

    It is my understanding that in the UK all taxes are paid from the estate and beneficiaries receive what is left.

    CAT is different in Ireland. The beneficiaries are liable to pay any tax owed by them. In general residency is irrelevant as most benes would be Irish, I am excluding trusts etc as an assumption. Your partner is most likely domiciled here, so he is exposed to 33 per cent on anything over his threshold of 310k, that will also include any other assets his mother is passing on. Your partner pays any tax due, not the estate.

    He should ask his accountant to sort out a bridging loan to pay it. Is he the only beneficiary? I am astonished your accountant did not explain this to you already.

  • Registered Users Posts: 10,032 ✭✭✭✭Marcusm

    Presumably the probate has been satisfied in order to sell the house and any relevant CAT/inheritance tax has been dealt with given DOD in 2018. The personal representative of the estate should have sought clearance that there were no tax debts due from the deceased. If this has not been done, you’ll need to have it done. As you have not mentioned a CGT clearance (cg50), I assume that the house was not transferred to your partner as part of the probate process, ie the sale is by the personal representative of the deceased rather than by your partner.

    Was there a will and, if yea, who is the executor or if no will, who applied for administration of the estate?

  • Registered Users Posts: 156 ✭✭ismat

    Your accountant needs to file the cg1 and pay the tax due now. When this assesses revenue will either give approval to the solicitor to proceed or raise additional queries. A 2022 cg1 can be filed during 2022

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  • Registered Users Posts: 3 propertystress

    Many thanks for all of your helpful comments, I’ll try to pick all the points out.

    What I have manged to negotiate is for the accountant to calculate the amount of tax needed to be paid, a tax return completed (although the printed dates on the forms are incorrect, as the form is due next year) and for the solicitor to retain this amount and transfer the rest. The balance will be transferred when the tax is settled.  

    My accountant, nor solicitor explained this to me at all!

    Correct- the probate has been settled and satisfied and the property was not transferred to him, as it was to sell immediately after probate was granted.

    There was a will, he was the only beneficiary and the solicitor where it was lodged was the executor. The probate itself took 3 years to be granted and a further 4 months for these funds to be transferred – this experience was just appalling at such a difficult time, and this feels a little like re-living it (we used a difficult solicitor for the house sale).

    It does seem a little like using a hammer to crack a nut.

    Many thanks to you all. 

  • Registered Users Posts: 3 propertystress

    Thought I would come and update, as it might be helpful for others in the same position. What is actually needed is a letter of no audit - if you google this term it opens up a whole bunch of advice and other threads with non-residents experiencing the same issue. My advice to others is when you are looking for an accountant ask if they have dealt with this before and whether they know what a 'letter of no audit' is - mine didn't. Make sure your solicitor knows the process for a non-resident, it doesn't seem like mine did. What I have managed to negotiate is a transfer of funds from the house sale, a cheque from the solicitor to the accountant to pay the tax, then a letter of no audit requested. Good luck!