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Inheritance tax

Inheritance tax

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Hi All

Never come across this before. We have a client she received a property from her father, he passed away after 2 years, IHT was paid. The daughter, in the same time period,  now has cancer and wants to give the property to her mother. The daughter is not likely to survive.

The question is as the IHT has already been paid once two years ago what value do you use to calculate the new IHT. 

Are there any relief from IHT for the daughter.





Replies (4)

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Replying to 356B:
By Ronny123
16th Jul 2021 17:13

Thanks, just what I needed.

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By Tax Dragon
16th Jul 2021 17:10

When you say IHT was paid... on the failed PET, or on the estate because the failed PET used up the NRB? (Father having made the gift before death is likely to have a negative effect on the QSR. He could well have cost the family £1,000s.)

Which thought leads me to... is making another PET that's expected to fail really the best way to go here? It'll lose any QSR that dad didn't already cost them.

It's a very unfortunate set of circumstances. Don't make it worse by adding unnecessary IHT to unnecessary IHT.

(Caveat: of course I know nothing about the [overall] situation. I may be very wide of the mark. In what I have said and in what I'm about to say. Which is that I would urge you to look at the whole picture. And if IHT isn't something you deal with regularly, perhaps consider getting help in.)

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By Hugo Fair
16th Jul 2021 20:38

At the risk of stating the obvious ... IHT is a tax on an Estate, so the fact that two Estates (the father's and the daughter's) contain some identical assets isn't relevant (by default).

However, TD has already pointed you to a clue (QSR) regarding the question ".. as the IHT has already been paid once two years ago what value do you use to calculate the new IHT?" ... along with several caveats, as there is so much we don't know (about father's actions prior to death, treatment of his estate for IHT, and so on).

You really need paid-for advice from someone versed in all these aspects of IHT.

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