The following Trusts and Inheritance Tax guidance note Produced by Tolley provides comprehensive and up to date tax information covering:
This guidance note explains how to deal with changes to the taxable values in the original inheritance tax account.
When the IHT account is first submitted to HMRC, it is based on information available at an early stage of the administration. Before probate is granted the PRs have not been able to sell any assets, nor have they paid any outstanding bills. Valuations at that stage may simply be estimates or calculations which turn out to be incorrect. In addition, some assets or liabilities do not come to light until the process of administration reveals loose ends that need to be tied up.
Corrections to the IHT account may be generated by the taxpayer as a result of information which has become available whilst collecting in the estate. They may also be required following negotiations with HMRC or the District Valuer. Unless a non-cash asset is sold at arm’s length close to the date of death, any market value assigned to it is purely a matter of opinion on which differences may arise.
To an extent, the number and type of amendments to be reported will depend on how thoroughly the initial valuation of the estate was conducted, but this in turn depends on how complex it is, the nature of the assets and liabilities and how well the PRs knew the deceased.
The following lists are not exhaustive but provide a range of examples of the type of corrections that can be expected:
Provided the date of death value has been supplied by the bank, there should be no change to the valuation of bank accounts already declared. Banks do sometimes forget to give a figure for interest accrued to date of death, but while interest rates are low, the omission is rarely significant.
It is more common to find, during the course of administration, that a bank account has been overlooked in the initial
**Free trials are only available to individuals based in the UK. We may terminate this trial at any time or decide not to give a trial, for any reason.
Access this article and thousands of others like it free for 7 days with a trial of TolleyGuidance.
Read full article
Already a subscriber? Login
In certain circumstances shareholders may wish to pay dividends other than in proportion to their shareholdings. This aim is typically achieved by one or more shareholders not taking a dividend when it is declared. To effect this, the relevant shareholders must waive their right to dividends from
Companies sometimes provide directors, employees or shareholders with low interest (or interest-free) loans either as part of the reward package or on special occasions to help the individual meet significant expenditure. The employment income implications of these loans are discussed in detail in
This guidance note provides details of quarterly instalment payments (QIPs) for corporation tax purposes and which companies need to pay their tax liabilities in this manner.Generally, corporation tax is payable nine months and one day after the end of the relevant accounting period. However, large
A ‘pilot trust’ is one that holds a nominal amount of property (typically a small sum of cash) and does not become active until further funds are added later. The later addition is sometimes made on the client’s death by a gift in his Will. The use of pilot trusts in conjunction with Wills became a
To view our latest tax guidance content, sign in to Tolley Guidance or register for a free trial.