notifying banks & Inheritance tax

rolysatch
rolysatch Posts: 54
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edited 23 September 2023 at 2:13PM in Deaths, funerals & probate
Hi

i'm after a bit of advice. I very sadly lost my mum recently, to do probate i obviously need to know the amount of my mums estate. i've used the death notification service just over a week ago but not heard anything from the 2 banks in question yet (nat west and santander).

When the banks make contact will they initially give me full bank account balances and any direct debits that have been stopped? i realise to take control of the money i need to be granted probate, that's not a problem, but to start the probate process i need to know bank balances for inheritance tax purposes. So i'm not sure how i obtain these?

i believe i need an executors bank account, can this be at any bank or does it have to be at the same bank where the money is held?

The other query is, i believe that i can transfer my desceased fathers inheritance tax allowance to my mums estate as well as the additional allowance as she has left everything to her children. do i have to apply for this when doing the IHT forms or is it automatically applied?

any advice appreciated, thanks in advance
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  • I'm so sorry for your loss. For each bank, call them & ask to be put through to their bereavement team. (Often staffed by nice people, as they have very different targets to every other employee.) Get them to explain what they can do for you & what paperwork they need. They have a menu of different reports & analyses they can print & email or post to you, which will help with the 'sadmin',
    I don't know about executor accounts but my guess would be at the same bank as otherwise they're handing over large sums of money to another bank, and there are rules about that.

    I don't know about transferring inheritance tax allowance - I think you Do have to explain to HMRC that you are claiming it, they're not omniscient but an accountant should be able to help with that.

    Very best wishes to you & your siblings facing this difficult time as orphans.
  • thank you very much for your advice that's very helpful. i'll give the banks a ring next week and see if they can help. thanks again.
  • Linton
    Linton Posts: 17,029
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    The Tell Us Once service just covers the government and the local authority.

    You will need to present the death certificate, your ID and your authority to act (ie the will) to your mother's bank.  They will connect you to their Bereavement Service who will freeze the account and provide you with all the bank statements you need.  Depending on the amount in the account they may transfer it directly to you without needing probate.  The limit is usually something like £30K.

    It would be sensible to have a separate bank account for estate business as it makes your dealings transparent should anyone want to know and would make life easier should you die before completing your job.  It does not need to be a formal "executors account", some banks dont provide them anyway.  It does not have to be the same bank your mother used.  It may be easiest if you use your bank.

    All the transfer of inheritance tax allowances should be covered by the IHT forms you will need to complete.  You do not claim separately.
  • thanks for your help Linton. i did the "tell us once" initially, the "death notification service" is a different service that notifys finacial institutions but works along the same sort of lines apparently.

    the other info is very helpful thanks again.
  • Linton
    Linton Posts: 17,029
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    rolysatch said:
    thanks for your help Linton. i did the "tell us once" initially, the "death notification service" is a different service that notifys finacial institutions but works along the same sort of lines apparently.

    the other info is very helpful thanks again.
    I think you should tell your mother's banks directly and get appointments set up to move the process along.  Bank accounts should be frozen quickly after death.
  • Keep_pedalling
    Keep_pedalling Posts: 16,220
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    edited 23 September 2023 at 3:34PM
    rolysatch said:
    Hi

    i'm after a bit of advice. I very sadly lost my mum recently, to do probate i obviously need to know the amount of my mums estate. i've used the death notification service just over a week ago but not heard anything from the 2 banks in question yet (nat west and santander).

    When the banks make contact will they initially give me full bank account balances and any direct debits that have been stopped? i realise to take control of the money i need to be granted probate, that's not a problem, but to start the probate process i need to know bank balances for inheritance tax purposes. So i'm not sure how i obtain these? 

    It’s best to ring the bereavement department of each bank rather than the general number.

    i believe i need an executors bank account, can this be at any bank or does it have to be at the same bank where the money is held?

    you may not need one especially if you are the only executor and sole residual beneficiary. When I did my mother’s estate I just kept it in a separate current account in my name. 

    The other query is, i believe that i can transfer my desceased fathers inheritance tax allowance to my mums estate as well as the additional allowance as she has left everything to her children. do i have to apply for this when doing the IHT forms or is it automatically applied?

    any advice appreciated, thanks in advance
    If your father left everything to your mother then yes you will be able to claim his full NRB and probably his Residential NRB if your mother was a home owner. 

    Depending on the value of her estate you may not need to submit an IHT return. If the full transferable NRB from her husband is available you won’t need to do a return unless her net estate exceeds £650k, if you need to claim either or both RNRBs then a full IHT return will need to be completed even if there is no IHT to pay.
  • Tiglet2
    Tiglet2 Posts: 2,459
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    rolysatch said:
    Hi

    i'm after a bit of advice. I very sadly lost my mum recently, to do probate i obviously need to know the amount of my mums estate. i've used the death notification service just over a week ago but not heard anything from the 2 banks in question yet (nat west and santander).

    When the banks make contact will they initially give me full bank account balances and any direct debits that have been stopped? i realise to take control of the money i need to be granted probate, that's not a problem, but to start the probate process i need to know bank balances for inheritance tax purposes. So i'm not sure how i obtain these?

    i believe i need an executors bank account, can this be at any bank or does it have to be at the same bank where the money is held?

    The other query is, i believe that i can transfer my desceased fathers inheritance tax allowance to my mums estate as well as the additional allowance as she has left everything to her children. do i have to apply for this when doing the IHT forms or is it automatically applied?

    any advice appreciated, thanks in advance

    @rolysatch
    I am following this with interest.  I'm in a very similar position and also wondering about filling in IHT forms to HMRC prior to applying for probate.  I think my mum's estate will be close to the threshold, but the beneficiaries are mum's children and our father died 30 years ago, so should be able to transfer his IHT allowance.  


  • badmemory
    badmemory Posts: 7,522
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    Definitely only speak to the bereavement service & you may well not need an executors account especially if the will is straight forward.  Just make sure the money doesn't get mixed up with yours & keep good records.

  • If your father left everything to your mother then yes you will be able to claim his full NRB and probably his Residential NRB if your mother was a home owner. 

    Depending on the value of her estate you may not need to submit an IHT return. If the full transferable NRB from her husband is available you won’t need to do a return unless her net estate exceeds £650k, if you need to claim either or both RNRBs then a full IHT return will need to be completed even if there is no IHT to pay.

    Thanks for the advice that's very helpful regarding an IHT return as it will probably be just over the £650k and consequently i will need to use one of the RNRB. So your advice could save lots of time, rather than hmrc telling me weeks or months down the line that i need to fill one out.
  • Tiglet2 said:

    @rolysatch
    I am following this with interest.  I'm in a very similar position and also wondering about filling in IHT forms to HMRC prior to applying for probate.  I think my mum's estate will be close to the threshold, but the beneficiaries are mum's children and our father died 30 years ago, so should be able to transfer his IHT allowance.  



    hi, yes sounds very similar depending on the house value it will probably go just over the 650k so could save a lot of time doing the forms straight away rather than getting a request for them months down the road.
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