Left a quarter share of Parents house - IHT tax?
Discussion
Hi everyone, hopefully someone with knowledge of IHT can help...?
My parents own two houses in the small village I grew up in - about 25 years ago they separated but never divorced, and these two properties are both owned as Tenants in Common not Joint Tenants so they could Will half shares to relatives upon death.
My father has just passed away and has willed his 50% share of both properties to me and my brother as 25% each. My mother still retains 50% ownership of both properties and is still in fact living in one of them (the property my father was living in is now vacant).
Am I correct is saying that, once the two properties are valued, IF half of the value of each property is less than the £325,000, then my brother and I would not be liable for IHT on that willed share of the property?
BUT am I also correct in saying that once half of the two properties values is added together, and the remainder of the Estate in monetary terms is added in, once that passes the £325,000 point, we would be liable for IHT at 40% on the amount once £325,000 is subtracted?
So, for example, if both properties are valued at £500,000, and the remainder of the estate is £100,000, then would I be correct is saying that the amount my brother and I would be liable for IHT on is £275,000 at 40%??
Cos that is VERY sphincter tightening.... or have I got it completely wrong??
Any help most appreciated.
My parents own two houses in the small village I grew up in - about 25 years ago they separated but never divorced, and these two properties are both owned as Tenants in Common not Joint Tenants so they could Will half shares to relatives upon death.
My father has just passed away and has willed his 50% share of both properties to me and my brother as 25% each. My mother still retains 50% ownership of both properties and is still in fact living in one of them (the property my father was living in is now vacant).
Am I correct is saying that, once the two properties are valued, IF half of the value of each property is less than the £325,000, then my brother and I would not be liable for IHT on that willed share of the property?
BUT am I also correct in saying that once half of the two properties values is added together, and the remainder of the Estate in monetary terms is added in, once that passes the £325,000 point, we would be liable for IHT at 40% on the amount once £325,000 is subtracted?
So, for example, if both properties are valued at £500,000, and the remainder of the estate is £100,000, then would I be correct is saying that the amount my brother and I would be liable for IHT on is £275,000 at 40%??
Cos that is VERY sphincter tightening.... or have I got it completely wrong??
Any help most appreciated.
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