IHT and Joint Tenants V Tenants in Common
Discussion
Tenants in common, not married, 1st death. Deceased share goes to probate, IHT payable by the survivor. If no will, the survivor might won't even end up owning the deceased's share, because they are totally unrelated. The kids will get the deceased's share.
Joint tenancy, not married. No probate, the survivor owns the whole house the moment the other dies, but IHT on the deceased's share still payable.
Tenant's in common, married. Deceased's share goes to probate, no IHT if spouse inherits it all. If no will, spouse might not end up owning the whole house if it's high value and the deceased's share is worth over £322K. Children will get half of anything over that, and if it's very high value, they might have to pay IHT. The spouse will not.
Joint tenants, married, deceased's share owned by spouse automatically, no probate, no IHT even if the house is worth hundreds of millions.
2nd death, not much difference. If there's only one owner after the first death, then there is no joint tenancy or tenants in common, just one owner. House will go to probate, and IHT payable by whoever inherits it. The kids basically, will or no will. Although if the couple were married they'll have an IHT allowance of £1m, but only £500K if they were unmarried. ,
In all cases, IHT payable subject to IHT rules. So maybe no tax payable if below the limits.
I think. Someone cleverer than me will probably put me right soon.
Joint tenancy, not married. No probate, the survivor owns the whole house the moment the other dies, but IHT on the deceased's share still payable.
Tenant's in common, married. Deceased's share goes to probate, no IHT if spouse inherits it all. If no will, spouse might not end up owning the whole house if it's high value and the deceased's share is worth over £322K. Children will get half of anything over that, and if it's very high value, they might have to pay IHT. The spouse will not.
Joint tenants, married, deceased's share owned by spouse automatically, no probate, no IHT even if the house is worth hundreds of millions.
2nd death, not much difference. If there's only one owner after the first death, then there is no joint tenancy or tenants in common, just one owner. House will go to probate, and IHT payable by whoever inherits it. The kids basically, will or no will. Although if the couple were married they'll have an IHT allowance of £1m, but only £500K if they were unmarried. ,
In all cases, IHT payable subject to IHT rules. So maybe no tax payable if below the limits.
I think. Someone cleverer than me will probably put me right soon.
Edited by TwigtheWonderkid on Saturday 14th March 15:33
Edited by TwigtheWonderkid on Saturday 14th March 15:35
Not cleverer but the only part I could see a slight “ clarification “ to was this.
Although if the couple were married they'll have an IHT allowance of £1m, but only £500K if they were unmarried. ,
If their whole estate is worth more than £2.35m then the RNRB would have been already reducing above £2m on a sliding scale basis so at that figure the RNRB relief would in effect be zero.
Although if the couple were married they'll have an IHT allowance of £1m, but only £500K if they were unmarried. ,
If their whole estate is worth more than £2.35m then the RNRB would have been already reducing above £2m on a sliding scale basis so at that figure the RNRB relief would in effect be zero.
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