My cousin’s children (12 and 10) have inherited their grandfather’s house.
My cousin and his wife are obviously going to have to look after it for them until they are 18, but what practicalities are involved? I’ve told him he needs to speak to a solicitor, but I thought I’d ask on here for my own noseyness 🙂

1. Does the house need to go into some sort of trust?
2. Can my cousin and his wife (the parents) be the trustees?
3. They want to rent the property out, but income should be below income tax thresholds, I guess the trust needs a bank account to hold the money – is this going to be difficult?
4. My cousin wants to use some of the rental income to pay for things for the kids e.g. school trips and music tuition – is this doable/legal?

Anything else he needs to think about?

Children under 18 cannot own property, so if they are named in the will then a trust has been automatically formed with the executor of the will acting as the trustee.

I’m sure this can be changed, but as you said, proper legal advice is needed to get things set up properly.

As above proper legal advice. It’s my understanding the trust can use income to meet it’s objectives – ie to benefit the kids so yes it can be used for trips etc. There may be a few bores such as stamp duty payable upon transfer into the trust, so advice needed. This highlights the issue that the executor may require a reasonable budget to make this happen.

The property will need to be transferred from the estate into the names of the trustees named in the Will. They will then hold the property for the benefit of the children until they are of age. Trustees have a fiduciary duty to the beneficiaries, so the sensible thing to do would be to create a rental income by letting the house.
The trustees are permitted by law to release funds for the maintenance, education and benefit of the children, so that will cover most things.
If the trustees want to transfer the responsibilities to the children’s parents they can appoint them as additional trustees and then resign their own positions.
If you need help, I do this for a living, e-mail address is in my profile, so drop me a line.

Nick.

Thanks all, especially Nick

Very timely thread, as I’ve just been named as executor for my aunt/uncles estate (who are still with us but both very ill) and they are leaving their house to my kids (currently 6 and 9)

My plan ( when the time comes) would be to rent the property out and use some of the rental income to pay for school trips etc.

Their solicitor has been named as the other executor initially, so everything will be above board.

All sounds like a massive pain for your cousins TBH.

Who wants to be a reluctant landlord? What if the house need a chunk of money spending getting it up to scratch for letting?

I’d do my best to sell it and invest the money for the kids. Unless your cousins plan to kick the kids out into this house when they reach 18!

I’d do my best to sell it and invest the money for the kids

I guess that’d depend on the wording of the will – he might have said he wanted them to have the family home, not flog it straight away – if he wanted it to be sold then he would have said so in the will?