Tax demand after death and refund!!

in Cutting tax
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weezie7weezie7 Forumite
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Not sure if this is right thread, but....

Relative died August 2021. I am Executor. Letter from HMRC received re tax 31August 2021 - indicating may take 8 weeks to sort out whether refund or tax due for year 21-22. 2 Feb 2022 phone call to HMRC, in fact tax refund due! Received in February. Beneficiaries paid out March 2022.
23rd May 2022, now received letter saying outstanding tax due 'Indicating 'Simple Assessment calculator for 2021-2022'.
Tried phoning........long wait and not got through.

Anyone got any idea why tax refund and now outstanding for same year please??

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Replies

  • Dazed_and_C0nfusedDazed_and_C0nfused Forumite
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    Surely if you compare the two calculations that will show what has changed?
  • weezie7weezie7 Forumite
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    Thanks for the reply. Tax was already paid for the 5 months of life (£357), refund was £644.40, now says I owe £287.40! There is something called a Charge Reference, and also under 'Explanation' it says that I did NOT receive the HMRC refund.
    Also, the amounts of income differ and the tax paid differs.........

    What is happening at HMRC??
  • JGB1955JGB1955 Forumite
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    As an executor you would be required to supply a tax return for income received by the deceased from 6 April 2021 to DOD in August 2021. The estate would also be liable for income tax on any estate income from DOD in August 2021 until 5 April 2022 (and beyond) until the date of 'winding up'.  Are you looking at two separate tax liabilities?
    #2 Saving for Christmas 2023 - £1 a day challenge £740/£1460
  • weezie7weezie7 Forumite
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    Hi thanks for the reply.
    1. Should I have done a tax return? I did not know I had to do that, as when I spoke to HMRC and talked with them, I asked about any tax, and they looked at it all and said I was due a refund, which I got a bit later, no mention of a tax return.
    Why is there tax on the estate after death? There was some 'income', ie payouts, from Premium Bonds and a Life Insurance.
    As I said, I have paid everyone out, including all the charities, which were numerous!
  • edited 7 June 2022 at 6:16PM
    JGB1955JGB1955 Forumite
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    edited 7 June 2022 at 6:16PM
    Any (most) income on the estate after death is taxable - I had to pay dividend tax and interest (on savings) tax.  The estate has no 'personal' allowance, so it's all at 20%+
    #2 Saving for Christmas 2023 - £1 a day challenge £740/£1460
  • sherambersheramber Forumite
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    Does the Simple Assessment show where the income 'tax deducted comes from- Pensions. employer. savings income etc?

    Was any additional payment made at a later date?

    The best time to phone HMRC is as soon as lines open. That way you are at the front of the queue.
  • weezie7weezie7 Forumite
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    Thanks, sheramber, have dug out the paperwork. Thought it might be easy to get to the bottom of it, but seems not!

    I recall an additional private pension payment, for the two weeks in the month she died and a letter saying the net payment will be credited to her account and that the gross pension was paid, and tax deducted. So from that I assumed that all tax was up to date..........

    I will speak to HMRC about it.

    Do you know what the 'Caharge reference with a long number is?
  • weezie7weezie7 Forumite
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    Sorry should read 'Charge reference'!
  • sherambersheramber Forumite
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    weezie7 said:
    Sorry should read 'Charge reference'!
    It is the reference you need to quote when making payment to  identify where the payment should be  allocated

    https://www.gov.uk/simple-assessment

    Pay by cheque

    You can pay by cheque through the post. Make the cheque payable to ‘HM Revenue and Customs only’ and send it to:

    HMRC
    Direct
    BX5 5BD

    Write your Charge Reference Number on the back of the cheque - you’ll find it on your Simple Assessment letter.

    It usually takes 3 working days for your payment to reach HMRC.

  • weezie7weezie7 Forumite
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    Thanks for the info, have a plan to call HMRC ........ will do so early one morning! Will update when done, so others can see too. 
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