Quick sanity check

GenX0212

Hi all,

Hoping someone can help with a quick sanity check of our situation and thoughts on Probate and IHT. Have spent hours going back and forwards (and around in circles) over the gov.uk IHT and Probate pages and think have finally got a clear understanding. Whoever wrote those pages needs to have a word with themselves as it's really difficult to follow the thread without being sent around in circles......

Specifics:
Mother has just recently passed away
Father passed away in Feb 2009 with everything passing to the Mother at that time (Married)

Mother has assets roughly just over £520k comprising a combination of bank accounts, cash ISA, Stocks ISA, investment plan, National Savings and some small value shares.
There is no property involved, house was sold in 2023 after she moved into a care home in 2022.
No gifting involved in the last 7 years apart from the annual allowance (£3k) and small gifts (<£250).
No foreign assets.
Permanent UK residents.
No life insurance or lump sums that we are aware of (have been managing all finances under LPA for last four years).

Daughter is named as executor in the Will (in place of the deceased husband).

Our understanding:
IHT threshold is £325k but is extended by the unused allowance from her deceased husband by a further £312k giving £637k in total.
Additional downsizing of £175k from the house sale is available but is not actually needed as the total estate is less than the £637k


Therefore the estate is considered an excepted estate there is no inheritance tax to pay.
Therefore it is not necessary to submit full details of the estate and we can proceed directly to probate.


If anyone can confirm we are on the right track that would be much appreciated.

poppystar

Yes on right track! Since all her husbands estate came to her so he used none of his NRB this can be transferred to your mother giving a total of £650k and the estate is excepted so only probate application to be made no need to do a full IHT return. (If you were using the residential NRB you would also have had to do a full IHT return even though none due). 

Smudgeismydog

As poppy star said, your Dad’s full Nil Rate Band of £325,000 is transferable as everything passed to your mum on his death.