The hand-book of the law of legacies / containing a statement of the nature of legacies, and the accidents to which they are subjects; together with the rights of legatees, and the causes and manner of the ademption, cumulation, and abatement of their bequests

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DUTY UPON LEGACIES.

The executor is responsible for the duties upon all legacies, and must pay them. He, therefore, pays every legacy specified in the will, short of the amount which he has to deduct for duty; and on its payment he is bound to take a property stamp receipt, according to the value of the legacy and the relationship of the legatee to the testator.

A bond debt forgiven by will is a legacy, and therefore liable to duty. Duty was charged upon a legacy of £50 a-year, to be laid out in bread and divided among the poor of the parish, although some of them only received about two shillings a-year each. But a residue to be divided, in which the several recipients did not receive more than £15 each, was not chargeable, though had any of the legatees been entitled to more than £20, their share would have been.

Where a legacy is directed to be paid “without deductions” or “free of expense,” the executors must pay the amount in full, and discharge the duty from some other fund. Such, also, will hold with regard to annuities as well as sole legacies. An expression, also, of “clear of all outgoings and taxes,” with respect to an annuity, will carry the same privilege.

If by the will a legacy be given free of duty, and by the codicil that legacy is revoked, and a larger one given by way of increase, it is equally free from duty as the original legacy. But if an annuity be left in the body of the will, free from all stamps and taxes, with a gift over, which is revoked by the codicil, and a small annuity left, without the gift over, it is held to be altogether a new legacy, and not entitled to exemption from duty.

Where a testator died in India, where his executors also lived, and where all his property was situate, it was held that a legacy remitted to a legatee in England was free from duty. When, however, part of such a testator’s property was found in England, and a legatee instituted a suit to have his legacy paid out of that portion of the assets, it was liable to the duty. Property belonging to a foreigner, though it be in this country and given to English legatees, is not liable to duty. But American, Austrian, French, and Russian stock, if the property of a person domiciled in this country, is liable to legacy duty. Yet probate duty is not payable upon property situated in a foreign country, though brought into this, and administered by an English executor.

In general it may be observed, that where an executor has inadvertently paid a legacy without deducting the duty, he can compel the legatee to refund, and in one instance, when an annuity had been paid for four years without deducting the duty, until the executor had assigned the whole of his interest, he was deemed to be only the surety of the legatee, and could compel him to return accordingly.