What You Should Know About Inheriting a Property After a Death

After a loved one's death, it can be hard to grieve through the process as you reminisce the moment you shared when they were alive. As a way of keeping their memory alive, they could leave you with an inheritance. Wondering what to do with the property could be a constant worry.

However, the guide below offers you a detailed guideline on what you should know about property inheritance.

There is Inheritance Tax

With property up for an inheritance, the law has requirements on the tax levy. The percentage of the tax amount depends on the value of non-exempted gifts from the years before when the deceased was alive. After that, the law requires inheritance tax, which the deceased's estates will settle.

However, the inheritance is exempt from the tax if it has not attained the maximum threshold. For instance, in the UK, you will not pay taxes if the property has a value of less than £325,000. Additionally, if the tax is under 100% inheritance to the spouse, there is no legal mandate on tax payment.

Can You Sell?

Absolutely! Sometimes, if you feel the need to sell the inherited property rather than keeping it, you have no legal restrictions not to do it. In such an instance, your duty lies in paying capital gains tax after the sale.

You will also ensure that the deceased's estate's income tax has a prompt and timely payment. Before selling, you should first evaluate the property value and status at the time. You should also carefully assess the property insurance policy if any. However, the sale should only proceed if the parties attached to the property in question agree about the deal.

In other instances, you may opt not to sell the property but instead put it up for rent. You will have to pay capital tax on the rent. 

Claiming the Title 

Even if the deceased has a legally binding will leaving you in total charge over a property, you still need the title.

A will eliminates the occurrence of property battles. Perhaps the deceased used an online service writing will to formulate their wishes should they pass on. As an heir to their property, getting the property mutation title is usually the legal step in ensuring that the property transfer is now under your name.

It May Not be All Rosy

Sometimes you may feel that property inheritance is the ultimate money bag to get you out of your struggling financial woes. However, it is essential to note that once you inherit property, it comes with liabilities. Therefore, it means that all the debt settlement will fall squarely on your shoulders.

For instance, if you inherit a property home with pending mortgage payments, you need to complete the payment plan.

Property Inheritance with a Will vs. Without a Will 

The inheritance will vary significantly if the deceased wrote a will and when there is no will. When there is a will available, property inheritance is a seamless process. As a beneficiary to the deceased's property, you get the specified assets in the choice. However, the estate becomes complex if the deceased did not have a will, and you are a beneficiary tongue deceased.

In the latter, property ownership battles are a common phenomenon as beneficiaries claim inheritance rights. 

An Occupant May Take Control

Sometimes, you may inherit a property that is far from where you reside. In such an instance, it becomes essential to formulate timely visits to the area to monitor the property. However, it may become difficult to properly lookout for the property.

Depending on where you are, the time an occupant can take control will vary. If you go for an extensive duration, the occupant gains legal authority over the property if you don't dispute it within the specified period.

Do You Know You Can Disinherit it? 

Even when inheriting a property could seem like a lottery ticket, sometimes the best decision lies in distancing yourself from the property. In legal terms, it is disclaiming an inheritance. However, it is critical to note that any legal bearing of ownership over the property becomes null and void once you reject the estate. Ideally, it becomes as if you did not own the property at any point.

When making that decision, you should also make it in writing. Additionally, you have no legal mandate to receive any proceeds which might result from the sale of the property in question.

With property inheritance, it is advisable to keep your emotions in check and attend to the property in the best way possible that you can.