Inheritance Tax - Deceased spouse threshold allowance

haynesycop

*apologies if this is the wrong place for this thread but it seemed like the most appropriate section to use*

Hi everyone,

I am fairly confident that my assumptions are correct on this but I was hoping to get clarification to put my mind at ease regarding inheritance tax.

My grandmother has a fairly large amount of cash assets (just over £500,000) and with the house (around £150,000) she would in normal circumstances be over the inheritance tax threshold.

Upon her death everything is being left entirely to her daughter. So her Will is very simple.

My grandfather passed away in 2013 so a lot of the money was passed over from his assets to my grandmother. Am I right in thinking that his inheritance tax allowance passed to his spouse upon death meaning that my grandmothers threshold is now £950,000.00 and no inheritance tax would be due?

We are thinking of speaking to a financial advisor anyway but any clarification on the above would be much appreciated.

Thanks in advance.

xylophone

See https://www.gov.uk/guidance/inheritance-tax-transfer-of-threshold

a lot of the money was passed over from his assets to my grandmother. 

But not all? See above.

haynesycop

Hi, thanks for the reply.

I was under the impression that all of his allowance would have passed over to my grandmother as she was his spouse? Meaning that the total allowance would be around £950,000.00.

Some money was held jointly by my grandparents (from my mothers deceased sibling) before my grandfather passed away. Then when he passed it was transferred solely to her.

We have made an appointment with a solicitor (who has dealt with both deaths) as there are some areas of ambiguity. 

Thanks for the quick reply the above was useful