Chapter 8: Pre-Grant Procedure Flashcards
What do a PRs first responsibilities include?
- Collecting information + documents pertinent to the deceased’s estate
- Registering the death w/ appropriate entities
- Obtaining valuations of assets, including using surveyors for land
- Considering the validity of a will + possible claimants against the estate
- Notifying beneficiaries of potential entitlements (subject to the will being admitted to probate and the satisfaction of any liabilities), and
- Placing early advertising for unknown beneficiaries and creditors
Why does IHT need to be paid?
If due, this must be paid by the PRs to obtain the grant
How can payment of IHT be funded?
- Banks + building societies may release deceased’s account funds directly to HMRC to pay IHT before the grant is obtained.
- voluntary scheme + can be slow.
- funds may be used to cover funeral expenses in a similar way. - Bank loan
- Loan from a beneficiary
- Sale of assets if no grant is needed prior to sale
- Insurance policy payments
What is usually needed for a bank loan to pay IHT?
Usually, an undertaking has to be given by the PRs and/or their solicitor to account to the lender from the first proceeds of realisation of estate assets
When may the insurance company pay the proceeds of a life assurance policy directly to HMRC?
If the proceeds of life assurance are payable to the estate
What might HMRC allow in exceptional cases?
May allow the grant to be obtained on credit if the PRs can demonstrate it is impossible to pay the tax in advance.
When will interest start to be charged on IHT?
After 6 months from the end of the month in which the deceased died