Probate Questions
Discussion
If a husband leaves everything in his Will to his wife is there any inheritance tax - I think not
In which case presumably the executors estimates can be fairly "finger in the air" as it doesn't really matter (or will this bite later when the wife dies)
The husband was a sole trader with no debtors nor creditors, presumably his stock is treated as any other asset and is now his wife's (circa £200k)
When his wife sells those assets presumably she wouldn't have to pay tax in the same way she wouldn't if she sold his drum kit ?
He has a substantial amount in his sole bank account - I understand that we have to carry out probate to access this but again as it's all going to his wife presumably this is a simple paperwork exercise ?
He was a wealthy but simple man so there are no complications of trusts, foreign property, shares etc but also no lawyers / accountants
Thanks
In which case presumably the executors estimates can be fairly "finger in the air" as it doesn't really matter (or will this bite later when the wife dies)
The husband was a sole trader with no debtors nor creditors, presumably his stock is treated as any other asset and is now his wife's (circa £200k)
When his wife sells those assets presumably she wouldn't have to pay tax in the same way she wouldn't if she sold his drum kit ?
He has a substantial amount in his sole bank account - I understand that we have to carry out probate to access this but again as it's all going to his wife presumably this is a simple paperwork exercise ?
He was a wealthy but simple man so there are no complications of trusts, foreign property, shares etc but also no lawyers / accountants
Thanks
You said home was a farm, iirc farm's are exempt from the calculation of an estates value where IHT is concerned.
If the business was farming related it might be exempt, too.
I hate to say this, but if it is farm/agriculture related it might be beneficial to get professional advice in this instance.
If the business was farming related it might be exempt, too.
I hate to say this, but if it is farm/agriculture related it might be beneficial to get professional advice in this instance.
Is his wife fit and healthy? Does she need the money? If not she should look at giving it away to children etc asap, as long as she lives for 7 years there will be no IHT to pay on the gifts. What you don't want is the wife dying with assets that take the estate above the IHT threshold.
KTMsm said:
If a husband leaves everything in his Will to his wife is there any inheritance tax - I think not
In which case presumably the executors estimates can be fairly "finger in the air" as it doesn't really matter (or will this bite later when the wife dies)
The husband was a sole trader with no debtors nor creditors, presumably his stock is treated as any other asset and is now his wife's (circa £200k)
When his wife sells those assets presumably she wouldn't have to pay tax in the same way she wouldn't if she sold his drum kit ?
He has a substantial amount in his sole bank account - I understand that we have to carry out probate to access this but again as it's all going to his wife presumably this is a simple paperwork exercise ?
He was a wealthy but simple man so there are no complications of trusts, foreign property, shares etc but also no lawyers / accountants
Thanks
Just a few notes (others feel free to add to or amend as necessary)In which case presumably the executors estimates can be fairly "finger in the air" as it doesn't really matter (or will this bite later when the wife dies)
The husband was a sole trader with no debtors nor creditors, presumably his stock is treated as any other asset and is now his wife's (circa £200k)
When his wife sells those assets presumably she wouldn't have to pay tax in the same way she wouldn't if she sold his drum kit ?
He has a substantial amount in his sole bank account - I understand that we have to carry out probate to access this but again as it's all going to his wife presumably this is a simple paperwork exercise ?
He was a wealthy but simple man so there are no complications of trusts, foreign property, shares etc but also no lawyers / accountants
Thanks
No IHT between spouses. (assuming both UK resident)
I would suggest you should still be as accurate as possible rather than 'finger in the air'
When selling assets she may be liable to CGT on any gain accrued since the probate valuation (depending on the asset).
Transfering the bank account once probate is obtained should be as straightforward as getting a bank to do anything!
His wife 'inherits' his nil rate bands for IHT purposes so on her death she could be entitled to £1 million in nil rate bands (NRB and Residence NRB) provided there is a residential property of suitable value involved which passes to direct descendents.
IF the wife has been previously widowed (i.e. before this husband died) this could have useful IHT planning opportunities, eg changing the will (deed of variation) to pass some to children now, with her using the first husband's NRBs when she dies.
Should be no income tax outstanding as sole traders usually pay in advance, may even be a refund, but check with HMRC.
Business Property Relief wouldn't be needed if everything passes to the spouse although could be if she carries on trading and then passes the business when she dies.
Enut said:
No IHT between spouses. (assuming both UK resident)
I would suggest you should still be as accurate as possible rather than 'finger in the air'
When selling assets she may be liable to CGT on any gain accrued since the probate valuation (depending on the asset).
Business Property Relief wouldn't be needed if everything passes to the spouse although could be if she carries on trading and then passes the business when she dies.
ThanksI would suggest you should still be as accurate as possible rather than 'finger in the air'
When selling assets she may be liable to CGT on any gain accrued since the probate valuation (depending on the asset).
Business Property Relief wouldn't be needed if everything passes to the spouse although could be if she carries on trading and then passes the business when she dies.
Ah - CGT I'll have to look into that, my instinct was to err on the side of caution but that could be a costly mistake
She will need to sell the stock but simply to obtain money back rather than to make a profit
If person who died was tax paying and died say 2/3rds of way through tax year (say October) then should get a tax refund as you get a full years tax personal allowance in tax year of death (plus full year of other similiar allowances) unless they have loads of other income.
HMRC wonderfully shut off online returns and said no further returns required - case closed. A real PIA to get them to re-open (ages waiting on phones around January filing time!) and then paper returns, chasing after 6 weeks and then getting back £1,700 PAYE for that year previously deducted from pensions etc about 50% higher than personal allowance level.
They must have had pretty good idea of this when they closed case earlier (as if there was going to be tax to pay they sure as hell wouldn't have closed it). Assume most people in similar case wouldn't have a return and they just shut down their on-line filefor them (linked to PAYE etc) and keep quiet.
HMRC wonderfully shut off online returns and said no further returns required - case closed. A real PIA to get them to re-open (ages waiting on phones around January filing time!) and then paper returns, chasing after 6 weeks and then getting back £1,700 PAYE for that year previously deducted from pensions etc about 50% higher than personal allowance level.
They must have had pretty good idea of this when they closed case earlier (as if there was going to be tax to pay they sure as hell wouldn't have closed it). Assume most people in similar case wouldn't have a return and they just shut down their on-line filefor them (linked to PAYE etc) and keep quiet.
KTMsm said:
Thanks
She will need to sell the stock but simply to obtain money back rather than to make a profit
If it is a farm, other consideration would be with valuations of growing crops/livestock at time of death & intended time of cashing in.She will need to sell the stock but simply to obtain money back rather than to make a profit
The difference between that & the price at harvest/time of sale is a trading profit & is taxable.
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