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By being helpful could this leave me exposed??

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  • By being helpful could this leave me exposed??

    An elderly friend has two classic cars undergoing extensive restoration and he is now suffering eyesight issues that may not be reversible.
    As ex motor trade and a trusted friend, he has asked me to now oversee the restoration for him and keep him informed how the cars are progressing.
    He has agreed a total cost for the work with the restorer's and they call for further funds as and when they need them. The release of these funds is subject to an inspection of the cars to make sure there is satisfactory progress being made with them etc etc. A normal arrangement with such projects I believe and I have no problem with doing this for him but....

    He also wants me to take charge of the finance by giving me the balance of the cost agreed with the restorer's to finish the cars, this is a considerable amount on money (five digits before the decimal point, almost half way to 6 digits). This again is not a problem but we are both retired and he is older than I by some years.

    We both realise that we have more years behind us than in front and he has provided instructions of what he wants me to do if age catches him up before they are finished. These instruction also cover should age catch me up first etc etc.

    My question is, am I leaving my self exposed (or my estate) should I die, either before or after him and still have his money in an account in my or joint names.
    I married late in life (3 years ago) and we have new wills concerning our tenants in common property arrangement this is willed separately to our children (my % to my children and her % to her children).
    At today's values, even with this money included, we believe we/I are below the inheritance tax threshold.

    I am just looking for some reassurance that by assisting my friend I am not letting myself in for any issues either now or later.
    I believe the cars concerned, as classics, are exempt of inheritance tax, am I right?
    Tags: None

  • #2
    Put the money in a joint account with friend and a signed document signed by both of you stating the purpose of the money. If he dies first the money defaults to you to complete the restoration, with the cars as part of his estate. If you die first the money reverts to your friend

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    • #3
      Originally posted by ostell View Post
      Put the money in a joint account with friend and a signed document signed by both of you stating the purpose of the money. If he dies first the money defaults to you to complete the restoration, with the cars as part of his estate. If you die first the money reverts to your friend
      Thats exactly what we were going to do but with a third option, that if I die after him and the cars are not completed the money will go to his daughter to pay for the restoration as she will inherit, as a trust, both cars on his death.
      There will be copies of the document lodged with each of our wills so the executors will be aware of the situation with regard to the funds in the account, to whom the money actually belongs and for what reason the funds are intended.

      Thanks for the advice.

      Comment

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