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    • lentrix92
    • By lentrix92 3rd Oct 16, 10:37 AM
    • 111Posts
    • 21Thanks
    lentrix92
    IHT question
    • #1
    • 3rd Oct 16, 10:37 AM
    IHT question 3rd Oct 16 at 10:37 AM
    Hi not sure is this is the right area so apologies if i double post.

    Scenario:-

    My wife's mum has inherited & sold a property from her parents after 2yrs of probate etc !!

    This has been split equally between my wifes mum and her sister.

    My wifes mum then wants of leave/gift X to my wife.

    Am i correct in saying that my wife can receive the amount tax free if it falls within IHT allowances and/or the amount is not impacted by death within 7 years ?

    On the IHT issue my wifes mum is married so can she split the amount she passes on to her husband v my wife ?

    Any help much appreciated - thanks
Page 1
    • xylophone
    • By xylophone 3rd Oct 16, 11:07 AM
    • 19,216 Posts
    • 10,927 Thanks
    xylophone
    • #2
    • 3rd Oct 16, 11:07 AM
    • #2
    • 3rd Oct 16, 11:07 AM
    My wife's mum has inherited & sold a property from her parents after 2yrs of probate etc !!

    This has been split equally between my wifes mum and her sister.
    With Deed of Variation? If not, and your mother took this into her own estate, then your mother is gifting her own money and this will count against her estate in terms of PET.

    http://www.inbrief.co.uk/estate-law/deed-of-variation/

    With regard to making other gifts to any other person than her spouse (which are IHT exempt), these, too, will be PETS but bear in mind that there is a gift allowance each year.

    https://www.gov.uk/inheritance-tax/overview

    https://www.gov.uk/government/publications/inheritance-tax-main-residence-nil-rate-band-and-the-existing-nil-rate-band/inheritance-tax-main-residence-nil-rate-band-and-the-existing-nil-rate-band

    https://www.gov.uk/government/publications/inheritance-tax-claim-to-transfer-unused-nil-rate-band-iht402

    http://webarchive.nationalarchives.gov.uk/20060213211319/inlandrevenue.gov.uk/leaflets/iht2.pdf - this may be worth a look though old.

    She should discuss her will with her solicitor.
    • HarryHill
    • By HarryHill 10th Oct 16, 2:57 PM
    • 2 Posts
    • 0 Thanks
    HarryHill
    • #3
    • 10th Oct 16, 2:57 PM
    • #3
    • 10th Oct 16, 2:57 PM
    My mother recently passed away and there is under £2000 in her bank account and no other assets. Before she died she gave each of her 5 children £5000. Does this now have to be declared for IHT through the Executor?
    • Linton
    • By Linton 10th Oct 16, 3:18 PM
    • 6,957 Posts
    • 6,550 Thanks
    Linton
    • #4
    • 10th Oct 16, 3:18 PM
    • #4
    • 10th Oct 16, 3:18 PM
    My mother recently passed away and there is under £2000 in her bank account and no other assets. Before she died she gave each of her 5 children £5000. Does this now have to be declared for IHT through the Executor?
    Originally posted by HarryHill
    If there is no tax to pay, and there isnt in the circumstances you state, her executor needs to fill in the simplified form IHT205 which does ask for a list of gifts above the £3K annual exemption. Other forms only need to be filled in if the total is above £150K which in your mother's case it isnt.

    So the simple answer to your question is YES.

    See here
    • badmemory
    • By badmemory 11th Oct 16, 10:33 AM
    • 231 Posts
    • 203 Thanks
    badmemory
    • #5
    • 11th Oct 16, 10:33 AM
    • #5
    • 11th Oct 16, 10:33 AM
    My mother recently passed away and there is under £2000 in her bank account and no other assets. Before she died she gave each of her 5 children £5000. Does this now have to be declared for IHT through the Executor?
    Originally posted by HarryHill
    My condolences for your loss.

    You could have a different problem depending on why she passed the money over before she died. If it was done to avoid spending it on her care then the DWP could chase some of it. I believe up to £14k. If it was only done to avoid much needing to be sorted after her death then there would be no problem.
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