Interest on inheritance.

[B.B.Prince.]

Hi all. First post, please be gentle

In UK law, if an executor holds on to an inheritance for some time (years), keeping it in a savings account, before distributing it to the beneficiary. Does the interest accrued also belong to the beneficiary? If so, and the executor eventually hands over the capital but refuses to hand over the interest, is that illegal? Does the interest form part of the inheritance?

I have read that the executor remains the executor until all funds have been disseminated to all beneficiary's. Does that include the interest?

We are talking in the region of £100k capital and over £10K interest (estimated).

Thanks for any help.

[PallasAthena]

Interest earned is part of the Estate and (unless the Will says otherwise) forms part of the distribution to residual beneficiaries. It does not belong to the Executor personally.

Interest earned by the Estate after date of death is taxable and given the amount involved the Executor is legally obliged to declare this to HMRC. Tax due is paid from the Estate.

https://www.gov.uk/probate-estate/ma...selling-assets

https://www.gov.uk/probate-estate/reporting-the-estate

[atticus]

Interest is payable on bequests not paid within one of the testator's death. The statutory rate is presently 3.38%.

[B.B.Prince.]

Thank you for your replies, and for confirming what I suspected.


A little more detail.

[B=The Beneficiary. E=The Executor. Siblings, now in their 50's.]

B is disabled and has been house-bound for about six years. (I help out with various day-to-day things). Amongst other things, their disability and medication renders them more trusting/credulous. It looks to me like they have clearly been exploited, their disability taken advantage of by E, whom I understand was quite keen to become executor and has oft repeated the sentiment 'Don't worry, I'll take care of everything, you can trust me', which in retrospect seems quite sinister to me.

The mother died intestate with two offspring (E and B), the father died many years earlier. A deed of variance was drawn and since B is disabled, E was made executor. And it looks very much like liberties have been taken. The original inheritance was in the form of a mortgage-free property, now owned 50/50 between the siblings E and B. Mid 2021, B was devastated to learn the property had been sold without consultation, and against the clearly expressed wishes of B, who was concerned inflation was approaching 10% at the time. This implies fraud was committed. IE: Falsely declaring sole ownership on a conveyancing contract.

The proceeds were kept by E in a high-interest account to which B had no access. B only received 'half' this year. Not including an estimated 10k to 15k interest. It's now safe in a Disabled Beneficiary Trust (not taxed or counted in means testing), where it should have been since mid 2021, and it took some not inconsiderable effort to get it there.

The HMRC and Fraud stuff looks like it might be a CPS issue, whereas the recovery of what's owed looks like a civil matter. Is that correct?

What action is recommended to recover this interest? A civil suit? Maybe just a letter from a solicitor would be an appropriate first step? I think it would do nobody any good if there were some sort of prosecution, and indeed, B fears such an outcome. B's adamant that B does not want to see E in the dock. (Personally, having seen the effect this has all had on my friend B, I'd like to see E dipped in honey and dangled over a Sarlacc pit).

Do you have any recommendations on how to proceed? (Or indeed the location of a Sarlacc pit).

[B.B.Prince.]

Sorry if I dropped a faux pas. Perhaps forget the Sarlacc, but I'm really motivated to help this person out. Could someone suggest a course of action, please?

[atticus]

What is this Sarlacc that we are asked to forget?

Doesn't post #3 point you the way? Request that interest.

[Pezza54]

I'm by no means an expert in property conveyancing
I'm just not sure how the property was sold without B's knowledge or agreement. B was made joint owner with E under the rules of intestacy
The conveyancer, and the buyer's solicitor, should have checked who was the owner or owners of the property and whether they had the authority to sell it

10% inflation does not necessarily mean property values are increasing. High inflation can have the opposite effect on house prices

[Pezza54]

What is this Sarlacc that we are asked to forget?

Doesn't post #3 point you the way? Request that interest.

It's a fictional creature in Star Wars

[B.B.Prince.]

Please, what action is recommended to recover this interest?

[atticus]

1st step is to request payment. If not forthcoming, a county court claim.

[B.B.Prince.]

Thank you Atticus. First step done, through a third party. E has changed address and has made efforts to prevent B from knowing it. How does one make a county court claim?

[atticus]

How does one make a county court claim?

You will also find some helpful resources in the thread linked in my signature block below.

[B.B.Prince.]

Thank you Atticus.