IHT - utility account transfers - credit balance impact on estate?

SoozyJ22

Box 76 on IHT400 includes "any refunds from gas, electricity or water suppliers". I'm wondering what the position is when the utility accounts were held in the deceased's name but are then transferred to their spouse's name after death. There is no refund as such to pay to the estate, but the electricity account, at least, has a small credit balance which will carry forward. Payments have always been made from a joint account so it seems a bit arbitrary if this were to count as a refund to the estate, when it could easily have been under the spouse's name from the same account and not counted.

Similarly with council tax, this was paid over 10 months from the joint account, with all payments made before the death. Once the single person discount is applied for the last ~2 months of the year I assume (though could be wrong) that this will be applied to the council tax account and offset against next year's payments. Would this amount be considered a refund to the estate?

While the amounts aren't massive, the estate is likely to just tip into the RNRB taper, so would be taxed at 60%. Additionally the spouse who would benefit from the credits seems reluctant to pass other refunds (sent to their joint account) over to the estate and is not due to pay any IHT from their share of the estate so a double whammy for other beneficiaries. If none of this counts as refunds towards to estate then I would be quite happy but if it does then I don't want to get the IHT forms wrong. 

Any experiences of this would be gratefully received. I know there's a helpline I could call, but I don't want to spend time on hold to them if MSE can help. 

Keep_pedalling

I would not declare them if there is a surviving spouse as the refunds would be covered by spousal exemption unless the deceased had had been dumb enough to leave more than their NRB to anyone else. IHT is 40% not 60%. 

SoozyJ22

Keep_pedalling said:

I would not declare them if there is a surviving spouse as the refunds would be covered by spousal exemption unless the deceased had had been dumb enough to leave more than their NRB to anyone else. IHT is 40% not 60%. 

Thank you. This was a second marriage and the will is such that the spouse will receive a specified amount, with the rest of the estate (including house to use RNRB) going to children and all fees and IHT taken out of the residual amount. So in theory if the refunds are part of the estate and the spouse keeps them, then those should be taken out of their specified amount once the estate can be distributed. Personally I don't think it's worth quibbling about given the amounts involved, but my fellow executor seems more inclined to play things strictly down the line so I was just trying to get the lie of the land when it comes to the status of the refunds. 

I know IHT is 40% but the RNRB is reduced by £1 for every £2 the estate is over £2 million so that in effect increases the rate to be paid for amounts over that limit. 

Keep_pedalling

Has his wife been given a life interest in the house? 

SoozyJ22

No, she has her own money from before their marriage and does also own a share of the house (the kind of share which does not transfer by survivorship). Between those and her legacy she will have more than enough money to downsize to a more suitably sized property.