When a client dies, one of the first things a solicitor must sort out is the inheritance tax. Two questions sit at the heart of it: who has to account to HMRC, and whose share of the estate actually pays for it? They are not the same question, and confusing them is a common — and costly — mistake. On top of that, personal representatives face a real practical squeeze: tax often has to be paid before they can even access the assets to pay it.
This lesson takes you through the whole sequence, from working out liability to getting the tax paid correctly and on time, with the protections and shortcuts you need to know along the way.
What this lesson covers:
- Liability: Who Must Account — who is primarily and secondarily liable to HMRC across the death estate, survivorship property, lifetime transfers and failed PETs, and how PRs protect themselves.
- Incidence: Who Bears the Burden — the default rule that tax falls on residue, how it affects legacies and property passing outside the will, and how a testator can change it.
- Due Dates and Paying Before the Grant — when the tax falls due and how to fund that first payment when no grant has yet been issued.
- The Instalment Option — which property qualifies to spread the tax over ten years, how interest runs, and what happens on a sale.
- Excepted Estates and Reporting — when a simplified report suffices, the full IHT400 deadline, and correcting the account later.