Inheritance tax and property

Chillout24

Both of my parents went into a self-funding care home in January 2023. In order for them to become permanent residents, we had to provide proof of 3yrs fees. This meant selling their home, as a valuation of the property was not sufficient evidence.
Mother died in June 2023, so Dad inherited her share of the property (at that point sold subject to contract). He also inherited Mother's unused Inheritance Tax allowance. The property sale was finally completed in early October, with the sale proceeds being paid into Dad's account. Dad died three weeks later. 
In trying to sort out the estate, I am now wondering whether it would have been more tax efficient to have sold his stocks and shares to provide the care home with proof of fees, instead of selling the house? Had the property still been his, the Inheritance tax threshold would have been greater, at £500,000, and we would have had significantly less to pay, if anything. I know it's too late for my family, but it would be interesting to know the implications in order for others to perhaps avoid being caught in the same way.

bobster2

Selling the stocks and shares would not have increased the amount not subject to IHT. Can still make use of the residential nil rate band (RNRB) if the house was sold before your dad died...

https://www.gov.uk/guidance/how-downsizing-selling-or-gifting-a-home-affects-the-additional-inheritance-tax-threshold

H657

Agree with Bobster2, you can still use the RNRB, so you should have a £1M (2 x £325 k + 2 x £175k) IHT allowance to utilise

Keep_pedalling

It sounds like your father inherited everything from your mother so his estate will have total exemption of £1M. As others have pointed out you can use the downsizing rule if sell up to pay for a care home, downsize or even move in with family.