IHT Query

[clarity9]

Looking for some advice, my father has just passed away and I have just started to look at the paperwork to fill out (IHT400 form).

The main residency was owned outright by him solely, it has been valued at £250, property A

However he had another property which again is owned outright with myself.so share is 50/50 jointly owned which is valued at £125 each.property B.

He lived in property A but while that was being modenized moved into property B. for a short while

Property B is where he made his will however when property A was finished he moved back into property A where he lived until he passed away.

I understand why I have to say the will is at a different address to where they died on the form.

When he moved out of property B it was left empty for a couple of years then I rented out the property.

He received no money whatsoever from property B being rented out. It was decided I should have it all and look after everything regarding the upkeep and maintance of property B.

I know that property B will be transferred in to my name as joint tenant however his half £125 has to go on the form somewhere but not sure where.

I am not sure how to get these details onto the IHT 400.

Sorry for it being long winded but any help would be appreciated.

[sederunt]

Have you confirmed that it is not an excepted estate and that IHT 400 is needed? What is/was father's marital status?

[clarity9]

Thank you Sederunt for your reply.

Fathers marital status is widower.

Could you explain what you mean by excepted estate please.

[sederunt]

An excepted estate is one where there is no need to submit an account to HMRC. One of the criteria that prevents an estate being an excepted estate, is a claim for RNRB, regardless of whether IHT is payable.

So it is preferable to claim transferable NRB unused by the predeceasing spouse, if available, to avoid the need for submission of an IHT 400. The estate then being an excepted estate with transferable nil rate band.

It does of course depend on the value of the whole estate being less than £650k, and certain criteria being met.

https://www.gov.uk/valuing-estate-of...type-of-estate

[clarity9]

Thanks for your reply, I have had a look at the link however I think I still need a little help.

This is what I have read on the website
" What counts as an excepted estate

An estate is usually an excepted estate if any of the following apply:

• its value is below the current Inheritance Tax threshold"

The inheritance threshold is £325,000 but can be increase to £500,000 if left to a child which I am. (estate value £392,000)

I look at the PA1P form and filled out the IHT checker tool and it came back with no inheritance tax to pay.

So as I child I am unclear on what form I have to fill out to claim the extra £175,000

Also what form to fill out to get a HMRC unique probate code to be able to go to probate? If it is not IHT400?

I thank you in advance for your help.

[sederunt]

Claiming Residential nil rate band means it would not be an excepted estate. So if there is sufficient unused nil rate band available transferable from a predeceasing spouse this is the way to go to avoid having to submit IHT 400 etc.

Apply for probate as an excepted estate with transferable NRB (if available) - no HMRC notification. No need for an HMRC code.

[clarity9]

Thank you for your help.

Wife died approx 23 years ago, never transferred over any probate allowance over to father. So I think that has passed now to claim that.

So unfortunate for me I will have to fill out the IHT 400 and go for child allowance.

[sederunt]

TNRB is claimed on the second death, not on the first. And the eligibility can apply where the first deceased person died on or after 13 November 1974.

[Pezza54]

Did your father leave property A, his main residence, to you or direct descendant(s)?
If he did, your father's estate is entitled to a total £500k NRB
You said his estate value is £392k which is under £500K
Although your mother's estate would be entitled to carry forward £175k RNRB there is no need to apply for it
As (property A is being transferred to you or a direct descendant?) the executor needs to apply for Probate
When you make the probate application, assuming you are an executor, you will need to complete and send to probate registry the Estates Summary Form NIPF7
NI stands for Northern Ireland but the form states it applies to the UK

No need to complete IHT 400

If your father hasn't left property A to a direct descendant then his estate cannot receive any RNRB, meaning there would be IHT to pay on £67k
Even though your mother died 22 years ago, maximum £325k unused NRB can be transferred. Unfortunately you will need estate accounts as proof.
To claim the transferable NRB IHT 216 should be completed. This form is complimentary to IHT 400

[clarity9]

Hoping that I have this correct now?
Does this mean that by claiming the TNRB for the first death this is then added to the 2nd deaths estate.
ie now TNRB has gone up to £650 allowance?
So as a child I would not claim the £175 on the estate as allowance?

[Pezza54]

Are you the named or one of the named executors?

[clarity9]

Did your father leave property A, his main residence, to you or direct descendant(s)?
If he did, your father's estate is entitled to a total £500k NRB
You said his estate value is £392k which is under £500K
Although your mother's estate would be entitled to carry forward £175k RNRB there is no need to apply for it
As (property A is being transferred to you or a direct descendant?) the executor needs to apply for Probate
When you make the probate application, assuming you are an executor, you will need to complete and send to probate registry the Estates Summary Form NIPF7
NI stands for Northern Ireland but the form states it applies to the UK

No need to complete IHT 400

If your father hasn't left property A to a direct descendant then his estate cannot receive any RNRB, meaning there would be IHT to pay on £67k
Even though your mother died 22 years ago, maximum £325k unused NRB can be transferred. Unfortunately you will need estate accounts as proof.
To claim the transferable NRB IHT 216 should be completed. This form is complimentary to IHT 400

Sorry Pezza54 Did not see your reply.

Father property A is main residence and I am a direct descendant being daughter also being named as executor.

Is that the only form I will have to complete or is there any other forms I have to do?

[sederunt]

You won’t necessarily need estate accounts as proof of eligibility of TNRB, HMRC has a much more pragmatic approach for deaths that occurred before 2007.

Submit the probate form and within the probate form claim TNRB - end of.

[sederunt]

Deleted

[clarity9]

I know this may sound a silly question but I would rather check I have it right.

Property A we got valued (Main Residence) in sole name.

Property B is the same as property A, therefore I never got it valued do I have to as it is in Joint names 50/50.