Grant of Confirmation

DN14

As said above if you are not deducting spouse or charity exemption just ignore the question.

I was an executor for an estate where a spouse's exemption was being claimed but the children choose not to claim their legal rights so ticked that they had revoked them, and HMRC did not ask for anything (formal or otherwise). However had the children claimed their legal rights it would have made no difference to the IHT position so I am not surprised HMRC were not interested.

I think HMRC will only be interested if the estate is one where the IHT bill would increase if legal rights were claimed e.g. if the children's legal rights exceeded the IHT threshold but where the will said all the money was to go to the spouse or  charities. HMRC don't want to say no tax is due and then later the children claim their legal rights. In such a scenario I think it more likely that HMRC would insist on seeing something formal.

Thanks for the replies.  As I was reading it, filling in IHT217 for transfer of unused nil rate band was claiming the (previously deceased) spouse exemption, meaning I'd have to answer the question but happy to be corrected - you are both saying the spouse exemption is the estate passing tax exempt to a surviving spouse, yes?  And I like the notion that HMRC will not be interested either way, given the size of the estate.  

naedanger

Yes. (If you have zero in box D under question 12 on page 3 then you don't need to answer question 9.)

Gers

8-Did the deceased:

• receive benefits from an alternatively secured pension fund as the original scheme member?

Does this mean an occupational pension? 

thanks

GSS20

Gers said:

8-Did the deceased:

• receive benefits from an alternatively secured pension fund as the original scheme member?

Does this mean an occupational pension? 

thanks

I put into the previous box did the deceased have any other arrangement than pension I answered yes as had a small company pension then the boxes underneath were all answered no. I think this question has been asked before and I’m sure the answer for this was no. 

This is taken from the notes for the second part (the ones where I answered no to all 3 questions : “You should answer ‘Yes’ to this question if the deceased benefitted from a dependant’s unsecured pension fund to which they became entitled as a ‘relevant dependant’ of a scheme member who died with an alternatively secured pension fund”.

testershah

Hi

Anybody got any idea what include in the figure that goes in 11.3 box in C5 form?  Is it joint back accounts and household goods?  
Also if say for eg  £100 in joint bank account and £60 for household goods then would i write £160 or would I write £80 i.e just the deceased's share in that box
Thanks

naedanger

testershah said:

Hi

Anybody got any idea what include in the figure that goes in 11.3 box in C5 form?  Is it joint back accounts and household goods?  
Also if say for eg  £100 in joint bank account and £60 for household goods then would i write £160 or would I write £80 i.e just the deceased's share in that box
Thanks

You should only include assets that pass by survivorship to the other party. And in Scotland most bank accounts do not pass by survivorship to the other party (even though the banks do allow the other party to operate the account on the first death - see notes on page 8 of the guidance). So you should probably include the owners share of the joint accounts in the inventory and not in 11.3. (Also the ownership is not automatically 50% either, but for husband and wife you can probably safely use that with any risk of questioning.)

For jointly owned household goods, I just entered the owners share in the inventory and £0 in this box.  

What you should include in this box is the owners share of any property owned on a jointly owned last survivor basis.

B0nkers

This has been a fantastic thread, thank you so much to everyone who has shared their experiences. 

I am completing forms C1 & C5 after my dad passed away and have a couple (seemingly very simple!) queries but I cannot work them out. 

Maybe I need to understand more about what passes to spouse automatically on survivorship versus a will that leaves everything to spouse.  The above question has helped but I am still confused and even if I work out which assets do and which don't I am not sure which go in the inventory section and which don't.

1) Dad had an ISA in his name but other than that all assets (house, bank accounts etc.) were in joint names with my mum.  The will leaves everything to her (children given up legitim rights – do I need to evidence that in any way?).

Do I list all assets in the inventory (those in dads sole name and those in joint names) but only record 50% of the value for joint assets? is this entered different for assets that pass to spouse automatically (e.g. house).

2) This is similar to the question from testershah immediately above.  If I’m only putting 50% of the value of joint assets in the inventory, it is that 50% value that would be copied across to 11.1 on the C5.  If that is the case do I leave 11.3 blank?

If anyone has anything like a similar example of a completed inventory sheet with 50% apportioned for joint accounts that they would be willing to share (personal information removed of course) I would be so grateful.

naedanger

The assets that go in the inventory are those that your father was entitled to leave to others in his will i.e. solely owned assets and his share of assets that he was a joint owner of, but which did not pass automatically by survivorship to someone else. The total of the inventory goes into box 11.1 (Think of this figure as the value of the assets he left in his will.)

His share of the assets that pass automatically to the survivor go in box 11.3. (Think of this as the value of the assets he owned at his death but which he could not leave to others in his will because the ownership passed automatically on death to the other joint owners.)

The taxman is interested in both figures. Don't include the value of any assets in both boxes or you will be double counting them.)

If the house was jointly owned then the exact wording describing the ownership matters since the ownership could be either on a last survivor basis or not.

In Scotland most joint bank accounts are not held on a last survivor basis.  

1) House - whether to enter his share on the inventory or not depends on whether it was owned on a last survivor basis or not). 
Bank accounts - enter his share of the balance on the inventory.
If all the children took their full legal right would the estate be liable to inheritance tax? (Probably equivalent to asking does the aggregate of the childrens' legal rights exceed £325,000?) If not then I doubt HMRC will ask for evidence that the rights were revoked. 
2) The figure in 11.1 should equal the total of the amounts shown in the inventory. 

B0nkers

naedanger said:

The assets that go in the inventory are those that your father was entitled to leave to others in his will i.e. solely owned assets and his share of assets that he was a joint owner of, but which did not pass automatically by survivorship to someone else. The total of the inventory goes into box 11.1 (Think of this figure as the value of the assets he left in his will.)

His share of the assets that pass automatically to the survivor go in box 11.3. (Think of this as the value of the assets he owned at his death but which he could not leave to others in his will because the ownership passed automatically on death to the other joint owners.)

The taxman is interested in both figures. Don't include the value of any assets in both boxes or you will be double counting them.)

If the house was jointly owned then the exact wording describing the ownership matters since the ownership could be either on a last survivor basis or not.

In Scotland most joint bank accounts are not held on a last survivor basis.  

1) House - whether to enter his share on the inventory or not depends on whether it was owned on a last survivor basis or not). 
Bank accounts - enter his share of the balance on the inventory.
If all the children took their full legal right would the estate be liable to inheritance tax? (Probably equivalent to asking does the aggregate of the childrens' legal rights exceed £325,000?) If not then I doubt HMRC will ask for evidence that the rights were revoked. 
2) The figure in 11.1 should equal the total of the amounts shown in the inventory. 

Brilliant - thanks.

The house is held on a last survivor basis so I don't put that in the inventory, I just put his share in box 11.3.

In terms of the bank account point - is that the location of the bank account rather than the fact they were in Scotland?  The bank accounts are joint accounts but held at an English bank (sort code location is England) as they moved around a bit and were there when they opened the account.  So is it the location of the deceased or the location of the asset?

It will all be below IHT thresholds so the safest thing might be to put it half share in the inventory.

Thanks again.

GSS20

B0nkers said:

naedanger said:

The assets that go in the inventory are those that your father was entitled to leave to others in his will i.e. solely owned assets and his share of assets that he was a joint owner of, but which did not pass automatically by survivorship to someone else. The total of the inventory goes into box 11.1 (Think of this figure as the value of the assets he left in his will.)

His share of the assets that pass automatically to the survivor go in box 11.3. (Think of this as the value of the assets he owned at his death but which he could not leave to others in his will because the ownership passed automatically on death to the other joint owners.)

The taxman is interested in both figures. Don't include the value of any assets in both boxes or you will be double counting them.)

If the house was jointly owned then the exact wording describing the ownership matters since the ownership could be either on a last survivor basis or not.

In Scotland most joint bank accounts are not held on a last survivor basis.  

1) House - whether to enter his share on the inventory or not depends on whether it was owned on a last survivor basis or not). 
Bank accounts - enter his share of the balance on the inventory.
If all the children took their full legal right would the estate be liable to inheritance tax? (Probably equivalent to asking does the aggregate of the childrens' legal rights exceed £325,000?) If not then I doubt HMRC will ask for evidence that the rights were revoked. 
2) The figure in 11.1 should equal the total of the amounts shown in the inventory. 

Brilliant - thanks.

The house is held on a last survivor basis so I don't put that in the inventory, I just put his share in box 11.3.

In terms of the bank account point - is that the location of the bank account rather than the fact they were in Scotland?  The bank accounts are joint accounts but held at an English bank (sort code location is England) as they moved around a bit and were there when they opened the account.  So is it the location of the deceased or the location of the asset?

It will all be below IHT thresholds so the safest thing might be to put it half share in the inventory.

Thanks again.

The bank account is where the head office is located regardless of where the account was opened ie bank of Scotland  head office Edinburgh therefore moveable property in Scotland Nationwide  building society head office in England therefore moveable property in England.