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Practitioners play an important part in minimising the risk of unnecessary delays in registration.
In the case of an incomplete application, or the more complex cases where HMLR requires additional information, requisitions (of which there are about 1m a year) can be expected - though the steady stream of updates to HMLR practice doesn’t always make it simple for conveyancers. That said, HMLR may raise informal telephone or email requisitions in relation to issues that can be dealt with quickly and easily.
Two recent changes to practice and procedure that all conveyancers should note are updates relating to applications for first registration; and a related inheritance tax issue.
Owner’s death
First, section 4.1 of PG1 on first registrations has been amended to clarify HMLR practice on how to apply for first registration when the estate owner has died.
It is now the position that a voluntary application for first registration cannot, at any time, be made in the name of a deceased estate owner (including a deceased mortgagor) as the estate vests by statute from the moment of death under section 1 or 9 Administration of Estates Act 1925.
The amendment goes on: “Where there is an assent or a transfer by the personal representative the application should be made in the name of the assentee or transferee. Alternatively, where no assent or transfer has been made the administrator(s) or executor(s) can voluntarily apply to be registered as proprietor.”
The application must be made by all the PRs and accompanied by the grant of representation. A foreign grant will only be accepted in relation to land situate in England and Wales if it’s been resealed in this jurisdiction.
What if the property was co-owned? Only the surviving owner can apply for first registration (an application for a Form A restriction may be appropriate if there was a tenancy in common).
The updated PG also covers the scenario where a sole mortgagor has died.
IHT liabilities
On a related note, practitioners should also be aware of an update to section 5.8 PG1 made in December 2022. Where a deceased’s property is the subject of a gift or an assent (ie not for valuable consideration), any liability for inheritance tax passed to the transferee.
The registrar is required to make an appropriate entry in the charges register if they consider on the evidence that the land may be liable to a subsisting inheritance tax charge. However, such an entry in the register or a requisition can be avoided by providing the necessary evidence, such as proof that IHT has been paid.
The updated PG1 can be found here.
To learn more about topics like this, our LAW2023 Online Property Law courses are available to book here.
