Your business questions answered by Dominic Coyle.

Inheritance: In 1996, my father died. In his will, he left his estate to me and my brother, who was resident in the UK at that time; I am living in Ireland.

As part of the estate, there were saving certificates and bonds, which now have a value of about €120,000. Following probate, all these were transferred into a joint account in the names of my brother and I. None has been cashed to date.

In 2000, my brother died and left his estate to his two children. As a by the way, a house which we jointly inherited from our father, was sold after my brother's death and half the proceeds were given to the children.

Probate for my brother was taken out in the UK by his children but they were not aware of the certificates/bonds, which were not taken into consideration.

All of the bonds/certificates have now matured. What I wish to do is to give to my brother's children 50 per cent of the value of the bonds/certificates.

Although the post office has not been provided with the detail as given here, it has advised that, as the certificates/bonds are in joint names, upon the death of one holder, the surviving holder owns the property.

If that is correct, there are, I think, considerable tax problems not only personally but also with respect to me giving the money to the children.

Mr B.S., Wicklow

The tax problems are not necessarily considerable; the vital bit is getting advice you can rely on. I spoke to several accountants in attempting to get a categorical answer and the truth seems to be: there isn't one.

In essence, everything seems to boil down to the intent - especially your brother's intent - when the savings bonds and certificates were put into joint names.

Let's start at the beginning. When your father died, there appear to have been two parts of his estate that were based in Ireland - the house and the savings certs and bonds. Both, as you point out, were put into joint names after probate.

Now, the critical thing is that the fact that these assets were in joint names does not necessarily imply that the surviving named owner is deemed to be the beneficiary when the other named owner dies. The one case where assets are certain to pass from one named owner to another is when they are married. Outside of this you cannot assume who will benefit.

None of this is to impugn An Post. It appears to have a straightforward set of rules that say it will deem the remaining owner of the saving certificate or bond to be the owner. As Deloitte director Mr Niall Glynn points out: Even though An Post will pay the money to the survivor, it is the intention of the parties opening the accounts in the first place that determines the tax situation.

The choices come down to two - joint tenancy and tenancy in common. Under joint tenancy, ownership of an asset passes on the death of one joint owner to the other(s). Tenants in common, however, can dispose of their interest or, of more particular interest to this case, can determine that it should pass by inheritance to someone who may or may not be a joint owner.

The fact that your father's house was sold subsequent to your brother's death, and the proceeds split between you and his children, strengthens your case that half of the proceeds from the savings certificates and bonds is rightly theirs, under the terms of their father's will.

The messy bit seems to have been that your brother's children did not realise the savings certificates and bonds existed at the time they took out probate.

So, to the bottom line. What is the tax liability? Mr Glynn says that you should have no liability yourself, as this has never been your money. The only issue then is whether your brother's children might have a liability under UK inheritance tax.

Apart from anything they inherited in the UK, they have also inherited a quarter each of the value of their grandfather's house. Now, they stand to inherit a quarter each of the €120,000 current value of the savings certificates and bonds - €30,000 a head.

UK inheritance tax is levied on the estate and not on the recipient. I understand the 2004 threshold is £263,000, that would have been about £235,000 in 2000 when your brother died. I would not be surprised if they have a liability to the UK tax, which is levied at 40 per cent.

Getting the definition of the original accounts right is important because, as Mr Fergus McCarthy, senior manager at PricewaterhouseCoopers, states, if the An Post position was accepted without question as far as your tax liability went, it would mean that you would effectively have inherited half the value of the savings certificates and bonds in 2000. Depending on anything else inherited from a sibling or linear relation, that could leave you exposed to inheritance tax that you would now be four years late in paying.

In that scenario, you would be gifting the two children €30,000 each in accordance with your brother's wishes - a transaction that would come under the Irish inheritance/gift tax regime. However, that sum would be comfortably below the €45,000 threshold governing gifts from uncles and, therefore, not liable to capital acquisitions tax (otherwise known as gift or inheritance tax).

As you can see, the difference of interpretation carries costs. Given what happened the house and your understanding of your brother's intentions, I would argue that you were merely acting as trustee of the funds in the joint account. You should pay the money over, keep a receipt and leave your brother's children to address any UK inheritance tax issues.

First Active: I'm sure you are sick of questions regarding the First Active deal but your advice has been invaluable to myself and, I'm sure, thousands like myself who are trying to work out what their capital gains liability is on the above deal before the due date.

In response to a reader's query in July you mentioned the possibility of crystallising the loss on the Vodafone share deal now. How do I go about that, given I haven't yet sold those shares?

Ms A.V., email

Well, you have hit the nail on the head in your final point. The only way to crystallise a loss is to actually cash in the shares. As long as you hold on to them, there is always the possibility that they might recover ground and advance far enough to make you a profit on the deal.

Using losses to offset gains is a sensible approach but it doesn't match scoring gains on all fronts and having to pay the capital gains tax (at 20 per cent) on all bar the first €1,270 gain, which you are entitled to tax free.

If you do wish to crystallise the loss, the cheapest way to do so, as explained last week, is to use the postal share dealing service offered by the share registrars, Computershare Investor Services, in Britain. The address in Bristol is on the Vodafone website together with details about how to proceed.

Please send your queries to: Dominic Coyle, Q&A, The Irish Times, D'Olier Street, Dublin 2, or e-mail to dcoyle@irish-times.ie.

This column is a reader service and is not intended to replace professional advice. Due to the volume of mail, there may be a delay in answering queries. Suitable queries will be answered in the newspaper. No personal correspondence will be entered into.