Morbid Inheritance Tax Question...

mastapeace

Hi All,

Thankyou for a great site !

This is my question :

My parents jointly own a small house that is mortgage free and paid for (valued at £90,000). Both parents are elderly although my father is in poor health. If my father was to pass away would my mother be liable for inheritance tax on my fathers half of the house which would be left to her automatically as my father has no will. Both parents have no other assets to speak of.
Also if my mother was liable for the tax how on earth could she pay it as they have no savings or decent life insurance other than a small policy to pay funeral costs.
In addition, if she was liable and did not have to pay until the house is sold, after her death the house would be left to myself and my sister, would we also have to pay my fathers inheritance tax as well as the inheritance tax on the property which is left to us.
Incidentally, do any other country's have a policy of taking 40% of stuff that is left to you even though the person who left it has already paid exorbitant tax throughout their lives especially on the money that they used to pay for the house in the first place, i just cant see how this can be seen as legal, let alone fair !!!!
Thankyou again for an amazing and helpful forum.
mastapeace :cool:

CLAPTON

IHT tax only affects estates over 300,000.. it charged at 40% on the excess only.

there is no IH tax payable between spouses.

so your mother wouldn't need to pay IH on your fathers death nor indeed would he if she died first.

you wouldn't need to pay any IH either based on the current valuation.

mastapeace

CLAPTON wrote: »

IHT tax only affects estates over 300,000.. it charged at 40% on the excess only.

there is no IH tax payable between spouses.

so your mother wouldn't need to pay IH on your fathers death nor indeed would he if she died first.

you wouldn't need to pay any IH either based on the current valuation.

Thanks CLAPTON,
Oh, well now i feel much better. Thankyou for your swift response. I had no idea.
Once again this forum helped me.
Cheers.