Probate IHT205 and Joint Accounts

Snot

Hi,

I'm trying to fill in the Inheritance Tax form IHT205 as part of my Dad's Probate submission and I don't understand how to handle cash in joint accounts. I know that everything will pass to my Mum without any IHT although:

This link says that the executor can ignore cash in joint acounts:

direct.gov.uk/en/Governmentcitizensandrights/Death/Preparation/DG_10029468

BUT the IHT205 seems to ask for details for joint cash, whether under question 13.1 (Deceased's own assets... or percentage of) or question 14.3 (Share of joint assets passing to survivor).

Do I ignore the joint cash and only record the cash in his name only or put both down ?

Any help would be appreciated.

John_Pierpoint

Lucky you, insofar as you are completing the "no chance of InHeritance Tax being payable" form because the value of the estate is less than £325,000.(or the limit at the date of death of your dad) OR to quote the guidance notes for IHT205: "gross value of the estate is less than £1,000,000 and all or part of the estate passes to the deceased's spouse, or a charity or other qualifying body".

If this is not the case you are looking at the wrong form.

(The quoted sentence does not make sense in that dad would not be getting away with no IHT, if he left one pound to mum, one pound to the Cats' Protection League and 999,997 to his children, but you know what they are trying to say - the instructions are at least 12 months out of date, as they fail to mention that the alternative form is IHT400 for those liable to IHT)

If this is not the case you are looking at the wrong form and need to ask for IHT400 etc. etc..

http://www.hmrc.gov.uk/rates/iht-thresholds.htm

You are reading the simplified version of the situation that applies to most estates where no tax is payable:

http://direct.gov.uk/en/Governmentcitizensandrights/Death/Preparation/DG_10029468

If the deceased had a joint account it is assumed that they owned half of it at their death, (unless you can show otherwise) so that half forms part of their estate. Were tax payable it would generate its share of tax; BUT regardless of what it says in the will, you as the personal representative cannot get your hands on that money, because it automatically goes to the account's joint owner.

In my experience most wills fail to spell out what is to be done about a potential major beneficiary in the form of the government. so be pleased that you won't have that to sort out and explain.

John

PS correction to the date for the compulsory introduction of the form IHT400 - hopefully all the HMRC web site entries have now been updated to reflect the following rules:
IHT400

The IHT400 and accompanying schedules has now been in existence since 17 November 2008. This form replaces the IHT200 and the ‘D’ supplementary pages. You may continue to submit IHT200 Inheritance Tax accounts until 9 June 2009, but from that date the new IHT400 account must be used.