IHT205 - lifetime gifts

Downthedrain

I'm executor for my late father's estate. The total estate value is £12,000, which amounted to a single bank account and a few hundred pounds in possessions. I though this was too little, so requested the past 7 years of statements from his bank. These show that he regularly withdrew sums of £500 and £1000 in cash, amounting to over £30,000 over those 7 years.

I am unable to trace where the money went to. He had very few friends, lived alone and had little contact with family members other than myself. He was quite vulnerable and very trusting, which raises a concern over where the money ended up - he certainly didn't spend it on himself.

The question is how do I report this when completing the IHT205 form?

buddy9

You do not use form IHT 205. It is for deaths prior to 2022 and from your other post, your father died recently.

poppystar

Have you approached the bank to see if they will release the money without probate for such a small amount? That way there will be no form filling at all🙂

As far as the withdrawals are concerned there seems to be nothing you can do. The value of the estate should be that at date of death so these amounts would not be included unless you can find a stash of money under a mattress or wherever. 

I can see why these withdrawals are concerning to you though but suspect there is nothing that can be done. It might be worthwhile talking to the bank’s fraud department who might be able to find out who took the cash (cash point or bank camera footage) but if your father did then the matter would end there anyway. But this is not part of your role as executor so no one will come to you looking for an explanation. 

Downthedrain

I've closed the account and the balance has been transferred to me. Everything has now been settled financially and I haven't needed probate.

Does this mean that I don't need to effectively send a 'nil return' to HMRC?

My father had made the withdrawals himself, so I'm resigned to never knowing what he did with the cash. My concern is one of protecting myself as executor and whether I needed to declare any of the sums as gifts of over £3000 in any of the past 7 years (even though I don't know whether they were gifted or not). 

Keep_pedalling

You don’t need to submit anything to HMRC. Your father’s estate including any gifts in the last 7 years would need to exceed £325k (£650k if he was a widower) before any tax would be owed.

Downthedrain

Thanks for the replies. This makes things more straightforward.