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    • retireetobe
    • By retireetobe 6th Dec 17, 10:33 PM
    • 10Posts
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    retireetobe
    Income Tax bill over a year after death?
    • #1
    • 6th Dec 17, 10:33 PM
    Income Tax bill over a year after death? 6th Dec 17 at 10:33 PM
    Would appreciate some advice before I ring the tax office.

    In September 2016 a pensioner friend died and I was executor and beneficiary of her will. I used the 'tell us once' service and everything seemingly went smoothly. During the process, a tax rebate cheque was received from Inland Revenue which was duly included in the estate, as was her final payment from her civil service pension (her only income, other than state pension). When the estate was finalised, we spent the money on our house refurbishment and we do not now have any savings.

    Then, about a week ago, I received a letter from the Inland Revenue saying my deceased friend owes income tax of just over £300. This is the first correspondence since the tax refund cheque a year ago.

    My question is, am I obliged to pay this given that the estate was finalised a year ago? I'm not trying to get out of paying anything if it is legally owed, but the estate money has long been spent and I will need to borrow from my bank to pay it.

    Thanks in advance for any advice.
Page 1
    • 00ec25
    • By 00ec25 6th Dec 17, 11:05 PM
    • 5,566 Posts
    • 4,971 Thanks
    00ec25
    • #2
    • 6th Dec 17, 11:05 PM
    • #2
    • 6th Dec 17, 11:05 PM
    as executor of the estate did you submit a tax return for the deceased covering up to the date of death?

    technically you should also submit a tax return covering the period after death if there are any income or expenses which arise during that period which form part of the estate's administration period. How did you ensure that what you told them "once" was correct?

    as it appears you are sole beneficiary, then you are now liable for the estate's unpaid tax as you are the recipient of the estate. You, as beneficiary, could if you wish sue the executor (ie. yourself) for failing in the executor's legal duty to administer the estate correctly by ensuring all taxes were paid before the estate was distributed....
    Last edited by 00ec25; 07-12-2017 at 10:35 AM.
    • jimmo
    • By jimmo 8th Dec 17, 10:25 PM
    • 1,889 Posts
    • 2,355 Thanks
    jimmo
    • #3
    • 8th Dec 17, 10:25 PM
    • #3
    • 8th Dec 17, 10:25 PM
    as executor of the estate did you submit a tax return for the deceased covering up to the date of death?

    technically you should also submit a tax return covering the period after death if there are any income or expenses which arise during that period which form part of the estate's administration period. How did you ensure that what you told them "once" was correct?

    as it appears you are sole beneficiary, then you are now liable for the estate's unpaid tax as you are the recipient of the estate. You, as beneficiary, could if you wish sue the executor (ie. yourself) for failing in the executor's legal duty to administer the estate correctly by ensuring all taxes were paid before the estate was distributed....
    Originally posted by 00ec25
    Harsh but true, I'm afraid and not just the Taxman. Any creditor of the deceased is entitled to claim what is owed to them.
    https://www.taxationweb.co.uk/forum/advertising-for-creditors-to-apply-to-an-estate-t34846.html

    When you get a bill from HMRC the first thing to do is check that it is right. If a computer has done the sums the arithmetic will almost certainly be correct so concentrate on the amounts of income and the tax deducted at source.

    As an example I dealt with the case of a family member who died in mid 2016 and HMRC initially included a full year's worth of State Pension in their calculation for the year of death whereas the deceased was clearly only entitled for the period to the date of death so check all the details very carefully.
    • PasturesNew
    • By PasturesNew 8th Dec 17, 10:31 PM
    • 60,991 Posts
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    PasturesNew
    • #4
    • 8th Dec 17, 10:31 PM
    • #4
    • 8th Dec 17, 10:31 PM
    I wasn't an executor, but I'm sure I recall an executor telling me they had the same thing a couple of years back; it was for a smallish amount - they phoned up and the tax office just wrote it off. I got the impression that whether it was a right amount or wrong amount, for a deceased estate as it was so little it was easier/cheaper for them to write it off than try to pursue it.

    Give them a bell.
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