Inheritance and Capital Gains Taxes

Gifts within the seven years previous to death (if above 6000 pounds IIRC) can be taxed on a pro rata basis (if the old lady qualifies to pay IHT). ie if the old lady dies tomorrow the younger lady will get taxed 6/7 of the iht (40% iirc) of the 50000 she had last year (about 15000 pounds) , plus any relevant lumps from previous gifts in the last seven years.

mrcheerful

In message , Alasdair Baxter writes

If the total of ALL gifts made by B in the seven years prior to her death (assuming none of the gifts where made to a discretionary trust) at the time of B's death does not exceed the Threshold for Inheritance Tax, which is currently £275k, then A is in the clear. If they do exceed the Threshold then the excess is chargeable on A @ 40%, but this is subject to taper relief for gifts made in excess of 3 years prior to death. If A cant pay then the Execs will have to.

See this link

and then look for the heading "Liability on potentially exempt transfers (PETs)" and follow the 4 links below that heading AND the links below the heading "Definition and extent of liability (PETs)"

The words "Curlies got short by you and the" come to mind.

In message , mrcheerful . writes

I'm afraid this isnt right at all.

However it does remind me that I didnt say in my other posts that B has an annual gift allowance of £3k, plus the previous years f not already used (which could be where your £6k comes from).

"john boyle" wrote

Do you mean that the Execs would have to pay *personally*?? That sounds a little worrying - can you elaborate a little, please?

For instance - suppose someone (let's call them person 'P') has a grudge against someone else (let's call them person 'X'). Person 'P' writes a will naming person 'X' as Executor and then gives away all their estate (to someone else, person 'A', who blows it all immediately - and so would then not be able to afford to pay the IHT if person 'P' dies within 7 years). Now, what happens if person 'P' dies within 7 years of the gift? Person 'X' (as Executor) has to pay IHT on the estate?? Ouch!

In message , Tim writes

No.

>

In message , Tim writes

Yes, The personal reps have yo, but the IR have discretion.

Check the link in my post or this sub link

"john boyle" wrote

As I said, Ouch!! So - is there any facility for a named Executor to say "No, I won't act as Executor" after they have been named in someone else's will? What if the Executor doesn't even know that they've been named in the will, until someone knocks on their door after the person has died??

In message , Tim writes

AIUI the reluctant executor would have to go to court and try and get somebody else, if none were forthcoming then I suppose the curt would appoint someone

Actually, this has happened to me! Luckily the estate was below the Threshold. (Phew)

I dont know what would happen if the IHT couldnt be paid by the lifetime transferee n these circs. The link implies that the CTO would be compassionate.