Excepted estate and IHT - Probate Registry query

LouieRTW

Dad died recently leaving all his assets to mum, his widow. His finances were simple, assets just being a share of the house, shares and cash. No international complications, trusts or anything like that. The value of the estate is c£700k.

I have read all the guidance multiple times and as far as I can see, this is an excepted estate and thus no reporting to HMRC for IHT purposes is required. I applied for probate on that basis a while ago with the c£700k figures as appropriate for gross and net estate for IHT and gross and net for probate but nil for net qualifying estate for IHT. I have received the following from the Probate Registry:

"Your application states you have not submitted IHT forms to HMRC to report the value of the estate. The Gross value of the estate you have submitted is above the excepted estate limit of £325,000 and you have answered ‘No’ to the question are you claiming unused Nil rate band. You have not claimed any other exemptions.

As the gross value of the estate exceeds £325,000 and there are no exemptions to claim you will need to report the value of the estate to HMRC. Please complete an IHT400 and submit to HMRC."

Ive been through a dummy probate application process again and can't see any way of indicating that this is an excepted estate due to the spouse inheriting (although of course this is indicated on the will). My first response from the Probate Service said "The application you have submitted indicates no assets in the estate. You will need to show assets on the form as a reason for why the Grant is needed" when the only nil figure was for the net qualifying estate for IHT, so I'm doubly not confident that the Probate Service is correct.

Help?!!

Thanks in advance.

poseidon1

Did you meticulously follow the following guidance for excepted estate applications, together with the IHT checker that supplies the gross and net estate values?

See links below.

https://www.gov.uk/applying-for-probate/before-you-apply#:~:text=The%20Courts%20and%20Tribunals%20Service,%2C%20civil%20partner%2C%20or%20charity)

https://www.gov.uk/valuing-estate-of-someone-who-died/estimate-estate-value

Brie

stupid question perhaps - did the house and the cash automatically become mom's due to them owning the home as joint tenants and the bank accounts being joint as well? If so they wouldn't be included in dad's estate as I understand it.

sorry for your loss and I hope you get all the paperwork sorted.

LouieRTW

@poseidon1 - I did, yes. All four figures are different but all in the same ball park.

@Brie - the house was changed from joint tenants to tenants in common back in the 1990s as that was a standard IHT planning technique at the time, so 50% of the value has been included in my figures.

My concern is really why the Probate Registry seem to think that all estates over £325k cannot be excepted estates and why they think I need to complete form IHT400 when all of dad's assets are being left to mum so there is no IHT in point.

buddy9

The registry comments seem to refer to criteria relevant to a ‘low value’ excepted estate.

On the basis of the information posted, this is an ‘exempt’ excepted estate. The gross value criteria for an ‘exempt ‘excepted estate is £3million.

lake888

@LouieRTW May I ask whether there is way that you can contact the Probate Registry who gave you the response by email or telephone to explan they are exempt excepted estate? As I might need to do a probate similar to yours and am a bit worrying.