Where too little IHT has been paid and no certificate of discharge has been obtained1, the underpaid IHT is payable with interest from the time when the full amount of IHT should have been paid2 whether or not the amount so far paid was that specified in a notice of determination3. The reason for the underpayment is immaterial unless based on a previous view of the law then generally held by the Board in which case the Board is bound by that view4.
However, once the Board has accepted payment of IHT in full satisfaction of an account, no proceedings can be brought for underpaid IHT after the expiration of the four year period beginning with the later of (a) the date on which the payment or the last instalment payment was made and accepted and (b) the date on which it became due5 (but see below for the increased time limits for offshore matters). Thereafter, any liability for the underpaid IHT and any HMRC charge for that IHT is extinguished6.
Where there is a loss of tax as a result of carelessness by the person liable for the tax, HMRC have a period of six years after the latest of those dates in which to make a claim (but see below for the increased time limits for offshore matters).
If tax has been lost as a result of a deliberate act by the person liable for the tax, HMRC have 20 years from the later of