Iht and probate

Stevet

Hi, I'm trying to work out what allowances are deductible from a deceases estate for probate and iht purposes. I am aware that the funeral expenses can be paid directly from the deceaseds account to the undertaker but what about other costs that are incurred by the estate after death? For example Solicitors costs,Death Certificates,The Wake,Property Conveyancing and other sundries? What I also find surprising is that it looks to me that iht is submitted before probate so how are any allowances deducted if applicable and estimated?

Keep_pedalling

Apart from
 funeral costs (which would include reasonable costs for a wake), none of the above can be deducted from estate for IHT purposes.

Stevet

Thank you. So the Iht is basically submitted
To hmrc at the total value of the estate at the time of death minus funeral costs? How are accounts that are accruing interest estimated and how do you value a property?
Are costs incurred after death needed for probate purposes please?

Keep_pedalling

Any income coming into the estate is subject income tax rather than IHT. If the estate is in on near IHT territory then the best option for the property to be professionally valued by a RICS surveyor. If IHT is not an issue then get 3 estate agents to value it and go with the highest valuation. I say highest as that minimises the risk of CGT  when the house is sold.

poseidon1

Stevet said:

Thank you. So the Iht is basically submitted
To hmrc at the total value of the estate at the time of death minus funeral costs? How are accounts that are accruing interest estimated and how do you value a property?
Are costs incurred after death needed for probate purposes please?

Accrued interest to date of death is potentially liable to IHT and has to be reported on the IHT return. See link below  to a revived thread on this subject.  Bank and building societies are supposed to provide a specific figure for accrued income at date of death either automatically or when you request.

https://forums.moneysavingexpert.com/discussion/comment/81243572#Comment_81243572

Incidentally the questions you ask suggests you may need may more detailed  step by step guidance of the work ahead of you  . Accordingly see below a link to a chronological 'checklist'  of tasks  to give you an idea of what is involved and to provide some structure going forward.

https://simply.law/england-wales/guides/probate-solicitors/checklist-for-executors/

However if IHT is in point for the estate, you may ultimately benefit from professional help, so you should consider that option if you are struggling with the HMRC guidance notes for applying for probate and preparation and submission of the form IHT 400.

poseidon1

Also if you are comfortable navigating excel spreadsheets, this thread from another forum contributors maybe helpful. Although, do note this seems to be a soft launch of what will be commercial software for sale.

https://forums.moneysavingexpert.com/discussion/6574924/free-spreadsheet-for-use-after-a-death#latest