Think Before You Gift: Inheritance Tax Risks on House Deposits
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By Scott Smith – Trainee Solicitor – Private Client
Losing a child is every parent’s worst nightmare. For one of our clients, the death of his foster daughter was a tragedy that reshaped his world. She had been removed from her birth parents at a young age due to their alcohol dependency and them being convicted of sexual abuse. He had provided her with the safety, stability, and care she had been denied early in life. Their bond was deep and genuine — a true family connection, even if not recognised in law.
When his foster daughter sadly ended her own life at the young age of 24, our client was left not only with profound grief but also with the overwhelming responsibility of dealing with her estate. She had not left a will, meaning she died intestate. Under Scottish law, this meant her birth parents — despite their history and lack of involvement in her life — were the people legally entitled to deal with and administer her estate. The law provides for a specific hierarchy of which blood relatives have right to deal with an estate. Her foster father, the person who had raised her and supported her throughout her life, had no automatic claim at all.
In the midst of his grief, he sought help. He approached several law firms. He contacted his MSP. He explained his situation again and again, hoping someone would guide him through the legal maze. Each time, he was turned away. No one was willing to take on the case given the complex circumstances. Everything changed when he reached out to Scullion Law.
Amongst her belongings, our client had found a letter she had written before her death. In it, she expressed clearly what she wished him to do with her possessions and who she wanted to benefit from her estate. Although not a formal Will, this letter provided crucial insight into her testamentary intentions and wishes.
Ailidh Ballantyne, Head of Wills, Powers of Attorney and Bereavement, led the case. She has spent years helping families put complex personal affairs on firmer legal
ground and is experienced in listening carefully and explaining difficult law in straightforward terms.
Our team recognised both the emotional weight of the situation and the legal complexity. We worked closely with our client to present this letter to the Court as evidence of her wishes and argued that the letter she had written before her death was enough to have him appointed as Executor. The Court agreed with this and appointed him as Executor, thereby providing him with the power to deal with her assets.
This case is a powerful reminder that the law is not just about rules — it is about people, relationships, and stories. At Scullion Law, we believe every client deserves to be treated with dignity, empathy, and commitment, especially in their darkest moments.
It further underlines why having a Will in place matters for everyone, regardless of age or circumstance. It also reflects the skill, experience and care required when the law is unclear and emotions are raw; qualities shown throughout by Ailidh Ballantyne and the team at Scullion LAW.
By listening closely, understanding the human story, and applying the law with confidence and compassion, we were able to secure an outcome that respected our client’s role and honoured his foster daughter’s wishes. If you or someone you know is facing a similar challenge, our team is ready to listen and to help.
This article relates only to Scottish Law and Scottish inheritance matters
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