IHT on Interest

Secret2ndAccount

I am administering an estate, and have been battling to get a payment which I was sure was due to the deceased. Today I have received a payment of 24,000 which consists of 20,000 owed, and 4,000 interest. The estate is subject to IHT. I see three options:
a) Pay IHT on 24,000
b) Pay IHT on the 20,000 owed, and income tax on the 4,000 interest
c) Try to apportion the interest as if the deceased had been paid the 20,000 plus the part of the interest that would have been due at DoD, then income tax on the rest of the interest
Anybody know?
Thanks

user1977

c) is correct. The estate was entitled to the interest up to the date of death, so IHT is due on that portion, Income Tax for the rest.

Keep_pedalling

user1977 said:

c) is correct. The estate was entitled to the interest up to the date of death, so IHT is due on that portion, Income Tax for the rest.

I am not sure if that correct. If for instance the interest was due to be paid at the end of a fixed term that ended after the death then the whole of the ingests would be subject to IT if it should have been paid prior to death then IHT applies. 

user1977

Keep_pedalling said:

user1977 said:

c) is correct. The estate was entitled to the interest up to the date of death, so IHT is due on that portion, Income Tax for the rest.

I am not sure if that correct. If for instance the interest was due to be paid at the end of a fixed term that ended after the death then the whole of the ingests would be subject to IT if it should have been paid prior to death then IHT applies. 

I assume from the description that it isn't that sort of scenario and it's something which could have been demanded on the date of death.

Secret2ndAccount

Thanks, I was thinking option C too. The interest is just compensation for not paying in the first place, so it's day-to-day.