Inheritance Tax IHT436 questions 7 and 8 RNRB percentage issue

Blox55

Hi

My mother-in-law died earlier this year and her husband (my father-in-law) died in 2013. Husband left everything to his wife in his will and his estate was worth more than 500.000 (and no gifts given).

I am filling in IHT436 to transfer my father-in-law RNRB to my mother-in-law. My understanding is that the whole of my father-in-law RNRB will be transferred to my mother-in-law RNRB.

However when I fill in the figures, I am unable to get the £175,000 result because the PDF form will not let me enter the percentage of 100% in the box #13 (the box is protected when the form is opened in PDF). This forces me to go via boxes 9 to 12, which then results in zero percent.

MY PROBLEM:

Q7 (total net value of spouse or civil partner's estate before exemption and reliefs) = £500,000

Q8 (value of the taper threshold at the spouse or civil partner's date of death) = £2,000,000   (as per form notes)

There is a note to question which 8 says:  "If the value at question 7 is less than the value at question 8, enter 100.0000% in box 13 and go on to question 14. If the value at question 7 is more than the value at question 8, continue to question 9"

So according to the note above, since £500,000 is lower than £2,000,000 then I should just go directly to question 13 and enter 100.0000%

However, I cannot enter 100.0000% in question 13 since this box is calculated automatically and is protected. The automatic calculation appears to be based on questions 9 -12 and in my case this automatic calculations ends up with strange negative number in question 9 and then following on the Q13 is automatically calculated as being zero which would mean no RNRB transfer entitlement!

Has anybody else had this problem? How to get around it? The only way I can get to be 100% is to make question 8 being exactly the same value as question 7.

Or do I just print the form and correct the value with the pencil?

Surely I must not be the only person having this problem in this form. I am pretty certain that my mother-in-law will get all of her late husband's RNRB, just not sure how to request it via the form!

WaywardDriver

Since you meet the condition in the note to Q8, you should leave Q9-12 blank. The 100% automatically appears in Q13.

Blox55

But this is the issue. I have left Q9-12 blank. The 100% DOES NOT automatically appear in Q13. 

Instead, the values automatically get calculated in Q9-Q12 and there is no way to remove them.

You can try it yourself - here is the online form, try to fill in Q7 as 500,000 and Q8 as 2,000,000, there is no way to get 100% in box 13. 

https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/983304/IHT436-04-21_english.pdf

Here is what I have entered. The greyed boxes are available to enter data. The white boxes are blocked from entry and calculated automatically. So the data in question 9-12 was calculated automatically by the form and I cannot remove/delete it, and this leaves Q13 empty - I cannot enter 100% there either.


Surely I am not the only one that has this problem?

How can one manage to get the correct values by entering the data directly into the form? The only other way I see is to print the form and complete it by hand.

WaywardDriver

Before replying I had tested using an IHT436 form dated 3/4/21. The one you're using is more recent at 5/5/21. There's clearly an error with this later version. If you message me your email address, I can send you my version which I doubt is much different. Alternatively fill in manually as you suggest.

Marcon

I've just tried using the 04/21 version and have the same problem.

OP, if you put 0.00 at question 7 and 8, it gets you 100.00 in q.13. You can then add a note to explain why you've done it.

Marcon

See above in case it helps!

WaywardDriver

Marcon said:

I've just tried using the 04/21 version and have the same problem.

OP, if you put 0.00 at question 7 and 8, it gets you 100.00 in q.13. You can then add a note to explain why you've done it.

The 04/21 version works for me. Thought issue might be because I'm using Adobe Reader rather than the browser (MS Edge) but still get error using Adobe on downloaded 05/21 version. Manual approach seems easiest option.

Blox55

Thank you very much to both! 

@WaywardDriver I have messaged you my email address since it would be easier for me to fill in PDF version online since all other forms are filled online and this is how I communicate with the lawyer. I will try using Adobe.

@Marcon, thank you, I will bear in mind in case 04/21 does not work for me.

Lets hope HMRC IT department fixes this in due course!

hjd

Have you made a mistake in the figures?
Box 7 £500,000
Box 8  £2,000,000
7 is less than 8 so go straight to 13.
You have done it the other way round unless I am confused?

Blox55

Hi hjd, no I have not made a mistake.
The whole issue is that I cannot go straight to 13. The form calculates 9 & 10 automatically - these boxes cannot be edited. And because there is something in these boxes, you cannot go straight to 13, which is also protected. 

This was the actual issue!

EmKrem

Hi Blox55...you are certainly not alone! I too am currently working on my late mother-in-law's estate. The financial and chronological details are coincidentally very similar. And so too is my utter perplexity with the logic and automated calculations of Boxes 7 and 8 et seq on form IHT436. Like you, when I enter the correct figures in Boxes 7 and 8, I am confronted by 'strange negative numbers' and zero entitlement in the subsequent boxes. And also like you, the only way I can plausibly get Box 13 to correctly show 100.0000% is by entering precisely the same figure in Box 8 (value of taper threshold) as the figure I have entered in Box 7 (net estate). Though I doubt it, could this be what HMRC actually means by the 'VALUE of the taper threshold' (ie, it exactly matches the value of the estate...unless the estate is over £2m)? Strangely enough, the built-in calculator does actually seem to work if you enter £2m in Box 8 and a hypothetical value of just-over-£2m in Box 7. But for us mere mortals dealing with more modest estates, I suspect that HMRC's algorithms and/or explanatory notes have utterly blown a gasket. So rather than continue trying to fathom HMRC's fiendishly-complex mind  - or second-guess its probably-faulty algorithms - I think I will resort to manual completion of this section of the form.  Good luck in dealing with this and all the other IHT forms. You have my sympathy.