Is it true that you can not pay your inheritance tax out of your actual inheritance?
Heard it some where but not sure what is what, thanks.
2007-06-04 01:39:26 · 5 answers · asked by H1976 5 in Business & Finance ➔ Taxes ➔ United Kingdom
Inheritance Tax is payable by the executors before Probate is granted and any money can be released to beneficiaries. The executors would normally take out a loan to cover the IHT, but if the estate holds any money in National Savings, then Nat Savings will pay the IHT direct. Good planning point to help your executors in the future!
2007-06-04 02:33:42 · answer #1 · answered by fengirl2 7 · 0⤊ 0⤋
It is quite usual for beneficiaries within a family to provide the funds to pay IHT, which saves the Execs some interest, but this isn't actually paying the tax from the inheritance.
The execs must pay the IHT before probate is granted , so it's a real chicken and egg situation.
2007-06-04 10:35:55 · answer #2 · answered by Do not trust low score answerers 7 · 0⤊ 0⤋
Hi
The inheritance cannot be released to the beneficiary until after the tax is paid. It is generally not a big deal though as most banks will do short term lending to cover it. Just like bridging loans when buying houses.
BTB
2007-06-04 01:44:10 · answer #3 · answered by BTB 2 · 0⤊ 0⤋
No it's not true, if you have more than 255000 coming to you anything after that will be subject to 40% tax which would need to come out of the inheritance it'self, if a solicitor is dealing with this then he will automatically pay it.
2007-06-04 01:48:16 · answer #4 · answered by vampini 3 · 0⤊ 0⤋
yes i have this problem at the moment
2007-06-04 01:45:16 · answer #5 · answered by dumplingmuffin 7 · 0⤊ 1⤋