DIY Probate for this estate: Yes or No

getmore4less

Does the new wife need any transferable nil rate band for her estate?

Savvy_Sue

getmore4less wrote: »

This is all very DIY able so far, but not a simple case so will need a bit of research and then if you are still not sure some paid for advice.

Just like to emphasise this. Do what you can, then get advice on the areas you're not sure about (or that anyone might argue with you about!)

DJBenson

Yorkshireman99 wrote: »

Unless the total estate is getting close to the IHT threshold, say £280,000 or above you can use your own valuation for the house. If there is IHT due then a professional valuation will be needed by an RICS or similarly qualified person. In any case forget the idea of free "kerbside" valuations as nobody is going to do that for free if at all. As the house was gifted within seven years of the death the value will have to be added back to the estate value for calculating IHT.

I've started filling IHT400 and it's supplementary forms - one is IHT403 "Gifts and other transfers of value" - in there I can specify the value at the time of the gift (listed as £72,000 on the deeds) and also the value at death which I've estimated at £60,000.

EDIT: In the process of filling out IHT205 and IHT217, I reached a question which put the transfer of the property (or it's total exemption from the estate calculation if you will) into doubt so I switched to the IHT4xx forms as per the guidance on the forms.

In any case, I found a copy of the grant of probate for my grandmother in the pack of documents I had which stated that the net value of the estate did not exceed £77,000 so even with a modest transfer of the unused IHT allowance, my grandfather's estate is well within the IHT allowance even if I valued the house at the value on the deeds.

The date on the deeds was 2005 so surely that takes us well outside of the 7 year period anyhow (12 between the transfer date and date of death and nine years from the transfer date to the date he left the property).

Thanks for the advice so far :beer:

DJBenson

getmore4less wrote: »

Does the new wife need any transferable nil rate band for her estate?

I don't think so but haven't broached the subject. What's the rationale behind this question?

Yorkshireman99

DJBenson wrote: »

I've started filling IHT400 and it's supplementary forms - one is IHT403 "Gifts and other transfers of value" - in there I can specify the value at the time of the gift (listed as £72,000 on the deeds) and also the value at death which I've estimated at £60,000.

EDIT: In the process of filling out IHT205 and IHT217, I reached a question which put the transfer of the property (or it's total exemption from the estate calculation if you will) into doubt so I switched to the IHT4xx forms as per the guidance on the forms.

In any case, I found a copy of the grant of probate for my grandmother in the pack of documents I had which stated that the net value of the estate did not exceed £77,000 so even with a modest transfer of the unused IHT allowance, my grandfather's estate is well within the IHT allowance even if I valued the house at the value on the deeds.

The date on the deeds was 2005 so surely that takes us well outside of the 7 year period anyhow (12 between the transfer date and date of death and nine years from the transfer date to the date he left the property).

Thanks for the advice so far :beer:

If the gifts were seven or more years ago then they are ignored as far as IHT are concerned assuming the donor no longer lived there.

Keep_pedalling

Yorkshireman99 wrote: »

If the gifts were seven or more years ago then they are ignored as far as IHT are concerned assuming the donor no longer lived there.

According to an earlier post he only moved out 3 years ago, so up to that point a gift with reservation, and the 7 year clock still had 4 years to run, so it can't be ignored for IHT purposes.

DJBenson

Keep_pedalling wrote: »

According to an earlier post he only moved out 3 years ago, so up to that point a gift with reservation, and the 7 year clock still had 4 years to run, so it can't be ignored for IHT purposes.

So back to my previous point; if I submit IHT403 with IHT400, with the relevant valuations (at point of gift/at point of death) I'm covered on this point - because the value of the house does not affect the IHT position of this estate from what I can gather (e.g. financial assets + house is less than the balance of the IHT of grandma and grandad - possibly less than the £325k in its own right without any transfer).

Yorkshireman99

DJBenson wrote: »

So back to my previous point; if I submit IHT403 with IHT400, with the relevant valuations (at point of gift/at point of death) I'm covered on this point - because the value of the house does not affect the IHT position of this estate from what I can gather (e.g. financial assets + house is less than the balance of the IHT of grandma and grandad - possibly less than the £325k in its own right without any transfer).

Yes it should be but get it wrong and you will incur a penalty and fine. That is why it is worth pay a few hundred pounds to specialist IHT law as it could save you far more than their fee. You cannot afford to rely solely on advice from here however well meant it may be."

getmore4less

getmore4less wrote: »

Does the new wife need any transferable nil rate band for her estate?

DJBenson wrote: »

I don't think so but haven't broached the subject. What's the rationale behind this question?

If the new wife estate will never go over the nil rate band(currently £325k) then she will not need any transferable nil rate band from her spouse.

Documenting what will be available now for her should she need it is a good idea so her estate administrator does not have to try to work out what happened in N years time when everyone has forgotten.

You also need to research how the chain of transferable nil rate bands works.

getmore4less

DJBenson wrote: »

The date on the deeds was 2005 so surely that takes us well outside of the 7 year period anyhow (12 between the transfer date and date of death and nine years from the transfer date to the date he left the property).

You need to research gifts with reservation to decide what date and value needs to be used as this effects the transferable nil rate band.