Reclaiming IHT on mis-valued shares

[Centurion07]

Can it be done?

Long story short; I was left some shares almost 3 years ago as part of an estate, IHT was paid but it looks like some shares were valued at value A when in fact they were a different type of share than thought (same company though) and therefore should've been valued at value B which is A LOT lower (circa 10x lower!).

All I can find on Google is reclaiming IHT on property sales and share sales that have fallen in value since probate, not things that were incorrectly valued in the first place.

[Eric Mc]

Have you got all that in writing?

How long ago was the IHT paid?

[Centurion07]

I'm fairly sure the missus kept copies of everything. Without checking, the IHT was paid around a year ago.

[Eric Mc]

Initially you would need to write to HMRC stating where you think the problem is and explaining the circumstances. You would need good evidence as to why you consider the original valuation was in error and why you think the lower valuation is the correct one.

[Centurion07]

Cheers for that.

The evidence would be that the shares I have are "C" shares in Rolls Royce which are issued instead of a cash dividend and are worth the grand sum of not a lot in comparison to the actual Rolls Royce shares which are are traded on the stock exchange.

It's not a mis-valuation in my working out but a mis-identification of the type of share so the mistake is easy to show, it's just whether or not they want to repay the mistaken amount.

[Eric Mc]

As I said, write to them providing as much documentary evidence as you can.

[Centurion07]

[Ozzie Osmond]

Centurion07 said:

It's not a mis-valuation in my working out but a mis-identification of the type of share so the mistake is easy to show,

As Eric has said, you need to write to HMRC and explain that an error was made.

My suggestion is to make sure the correction is requested by the same person/people who submitted the original incorrect forms. In other words, and depending on the exact circumstances, the correction should usually be requested by the executors who made the mistake and not by a beneficiary. It is the executors who paid the IHT.

Edited by Ozzie Osmond on Friday 8th January 21:03

[Centurion07]

I'm both.

[Ozzie Osmond]

In which case you should be fine to just get on with it.

[Centurion07]

Just receieved a letter from HMRC this morning confirming the shares were indeed overvalued and they have refunded me roughly £4K, which is nice.

What's not so nice however, is that they claim I owe them the thick end of £30K having not paid the full value of IHT due at the time.



Now frantically running round the house trying to find any and all paperwork from +3 years ago!

[Ozzie Osmond]

Ouch!

[Centurion07]

Is not one of the words I used upon reading the letter.