Business Rate Relief - Triple Point

Bolt1234

For all sorts of reasons my Fathers finances were in a real mess.  The vast majority of it has been sorted and he is now in a care home (a much safer place for him than his old house which was a hoarders house, and in a real state)

He had made no real provision for inheritance tax and his estate is approx £1.5 m.  He is single.  Divorced from my Mum many many years ago.

We put over £1.2 m into Triple Point Investments which providing he lives over 2 years will potentially be free of inheritance tax.  That time has now come.  He has a will written a couple of years ago and it’s straightforward.  He has a few special requests amounting to about £10k and then rest is to be split equally between his three children. 

 We have sold his house which was the vast majority of his wealth.

He is not in the best of health (nearly 90) but is as well as can be expected.  

Is there anything else I need to be aware of please in order that what we have done works once he passes.  He has requested that I sort this out for him.  I am his Power of Attorney and have been for a couple of years.

Keep_pedalling

Why out so much in a high risk investments? Your father’s estate has £500k of NRB to play with so why include a large chunk of that in the Alternative Investment Market when there is no tax to pay on that segment of his estate. 

Things to be aware of,

1. At £1.5 your father’s estate has a potential IHT liability of £400k, it is quite possible that the £1.2M+ investment could lose more than that.

2. worst possible outcome is that he dies within 2 years and the value of the investment drops significantly between death and probate being granted. Under those circumstances you would have to pay IHT based on the value at date of death, and unlike listed shares there is no relief for such a fall in value.

Bolt1234

So the two years has now been reached.  The value has gone up 1%.  I can live with that bearing in mind the saving overall.  I thought that the value is based on the day he passes so, yes, they could drop between that day and the day of probate.   I agree not ideal but anything else seemed to insist he lived 7 years and that isn’t realistic.

His estate was nearly £200k more at the beginning of all of this but he had a some repairs to do on his home before it was sold and he was still living there - think a boiler on its last legs, no hot water and leaks all over the place.  Additionally his care home is expensive at £70k per year