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  • FIRST POST
    • edges
    • By edges 16th Jun 17, 2:29 PM
    • 1Posts
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    edges
    Inheritance Tax allowance claim from 1978
    • #1
    • 16th Jun 17, 2:29 PM
    Inheritance Tax allowance claim from 1978 16th Jun 17 at 2:29 PM
    Are the executors of a lady, widowed in 1978, able to claim any of her late husband's Inheritance Tax allowance against her estate? When the husband died his estate was some £18,000 below the then threshold of £25,000 and the whole of his estate passed to her.
Page 1
    • getmore4less
    • By getmore4less 16th Jun 17, 2:56 PM
    • 28,784 Posts
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    getmore4less
    • #2
    • 16th Jun 17, 2:56 PM
    • #2
    • 16th Jun 17, 2:56 PM
    1978 although it was Capital transfer tax the spouse allowance applied so it is the same calculation as the current one.

    If everything went to spouse 100%.

    subject to their being no relevant lifetime transfers(Gifts/PETS)

    she should have a new nil rate band of £650k and if needed there will be the £200k RNRB to play with if that qualifies.
    • myrnahaz
    • By myrnahaz 18th Jun 17, 10:17 AM
    • 1,095 Posts
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    myrnahaz
    • #3
    • 18th Jun 17, 10:17 AM
    • #3
    • 18th Jun 17, 10:17 AM
    I believe that 1972 was the start date from which such allowance transfers were allowed between spouses. I've just tried to do the same thing for an elderly lady but, unfortunately, I could not use her late husband's allowance as he died in 1971.
    • eddyinfreehold
    • By eddyinfreehold 21st Jun 17, 4:27 PM
    • 6 Posts
    • 2 Thanks
    eddyinfreehold
    • #4
    • 21st Jun 17, 4:27 PM
    • #4
    • 21st Jun 17, 4:27 PM
    I am in a similar position at the moment. I am 1 of 3 children. My father was widowed in 1970 and never remarried. He died last year. Although the procedure is slightly more complicated with us the principle is the same. Estate duty was abolished and CTT introduced. This was abolished and IHT introduced. As I understand it whatever ED or CTT threshold existed at the time of the first spouses death counts. In my case 10000 of which my mothers estate was 2000. Therefore 80pc of her 325k allowance can be transferred to join my fathers allowance so that the first 268k plus 325k is IHT exempt.... ie 593k. In the case above the calc is (18/25 x 325k) + 325k = IHT allowance subject to all the above provisos like not remarrying etc.
    • Keep pedalling
    • By Keep pedalling 21st Jun 17, 5:54 PM
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    Keep pedalling
    • #5
    • 21st Jun 17, 5:54 PM
    • #5
    • 21st Jun 17, 5:54 PM
    I am in a similar position at the moment. I am 1 of 3 children. My father was widowed in 1970 and never remarried. He died last year. Although the procedure is slightly more complicated with us the principle is the same. Estate duty was abolished and CTT introduced. This was abolished and IHT introduced. As I understand it whatever ED or CTT threshold existed at the time of the first spouses death counts. In my case 10000 of which my mothers estate was 2000. Therefore 80pc of her 325k allowance can be transferred to join my fathers allowance so that the first 268k plus 325k is IHT exempt.... ie 593k. In the case above the calc is (18/25 x 325k) + 325k = IHT allowance subject to all the above provisos like not remarrying etc.
    Originally posted by eddyinfreehold
    80% of £325k = £260k not £268k
    • getmore4less
    • By getmore4less 21st Jun 17, 8:22 PM
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    getmore4less
    • #6
    • 21st Jun 17, 8:22 PM
    • #6
    • 21st Jun 17, 8:22 PM
    I am in a similar position at the moment. I am 1 of 3 children. My father was widowed in 1970 and never remarried. He died last year. Although the procedure is slightly more complicated with us the principle is the same. Estate duty was abolished and CTT introduced. This was abolished and IHT introduced. As I understand it whatever ED or CTT threshold existed at the time of the first spouses death counts. In my case 10000 of which my mothers estate was 2000. Therefore 80pc of her 325k allowance can be transferred to join my fathers allowance so that the first 268k plus 325k is IHT exempt.... ie 593k. In the case above the calc is (18/25 x 325k) + 325k = IHT allowance subject to all the above provisos like not remarrying etc.
    Originally posted by eddyinfreehold

    One of the main differences is the lack of spouse exemption.
    • eddyinfreehold
    • By eddyinfreehold 22nd Jun 17, 7:07 AM
    • 6 Posts
    • 2 Thanks
    eddyinfreehold
    • #7
    • 22nd Jun 17, 7:07 AM
    • #7
    • 22nd Jun 17, 7:07 AM
    "80% of £325k = £260k not £268k"

    ...stupid arithmatical error...sorry
    • eddyinfreehold
    • By eddyinfreehold 22nd Jun 17, 7:14 AM
    • 6 Posts
    • 2 Thanks
    eddyinfreehold
    • #8
    • 22nd Jun 17, 7:14 AM
    • #8
    • 22nd Jun 17, 7:14 AM
    "One of the main differences is the lack of spouse exemption"

    ...can you elaborate getmore4less ?

    Whether the death of the first spouse occurred during the regime of Estate Duty, Capital Transfer Tax or Inheritance Tax, the fraction of the then allowance not used at the time is the fraction of £325k which can be transferred to add to the 325k allowable for the second death, subject to the second death never having remarried. Correct or not?
    • getmore4less
    • By getmore4less 22nd Jun 17, 7:34 AM
    • 28,784 Posts
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    getmore4less
    • #9
    • 22nd Jun 17, 7:34 AM
    • #9
    • 22nd Jun 17, 7:34 AM
    "One of the main differences is the lack of spouse exemption"

    ...can you elaborate getmore4less ?

    Whether the death of the first spouse occurred during the regime of Estate Duty, Capital Transfer Tax or Inheritance Tax, the fraction of the then allowance not used at the time is the fraction of £325k which can be transferred to add to the 325k allowable for the second death, subject to the second death never having remarried. Correct or not?
    Originally posted by eddyinfreehold
    AT that time any transfer to spouse(and charities) were not exempt as they are now(partial exemption from 1972).

    if you end up with multiple deceased spouse/civil partners you get to use multiple transferable nil rate bands upto 100%
    • Keep pedalling
    • By Keep pedalling 22nd Jun 17, 7:53 AM
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    Keep pedalling
    Don't forget that the new primary residence nil rate band (currently £100k) may also apply and that is fully transferable regardless of the date of death of the first spouse.
    • eddyinfreehold
    • By eddyinfreehold 22nd Jun 17, 8:06 AM
    • 6 Posts
    • 2 Thanks
    eddyinfreehold
    getmore4less... thank you
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