IHT and house sale

vouch0r

hi all,

my mother has passed away and in the process of sorting out probate / house sale...

the house is valued at slightly over the 325k limit at 450k.

i dont really understand the threshhold changes in 16/17 tax year and hopefully someone can help me please?

if we postpone the sale to next tax year would it all be tax free perhaps? or more than 325k tax free? can we postpone the sale if allowed and maybe rent the property with the money going directly into the assets for my mother and then distributed as per the will?

thanks

Crabapple

You have to use the IHT threshold at the date of death so the changes next year are not going to apply, you use the £325k no matter when you sell. You also have to start paying the tax before then.

Was she a widow by any chance? There could be up to another £325k available if she had a husband who died before her and didn't use all of his Inheritance Tax allowance.

Keep_pedalling

If there is any IHT to pay it needs to be paid within 6 months, so unless there is also plenty of liquid assets in the estate to pay it you don't want to delay the sale too long.

vouch0r

ah thanks all, clarifies it for me.

she was married but divorced at the time of the death.

Yorkshireman99

vouch0r wrote: »

ah thanks all, clarifies it for me.

she was married but divorced at the time of the death.

In which case the second £325,000 is not available.You should read the stickies on this thread. The IHT has to be paid before probate is granted. This may mean that the executors have to take out a bridging loan to pay the IHT before the house is sold.

getmore4less

Can be paid in instalments(with interest) if property involved.

https://www.gov.uk/paying-inheritance-tax/yearly-instalments