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
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