Inheritance tax Flashcards

1
Q

transfer of value

A
  • when there’s a disposition which results in a reduction in the value of the transferor’s estate
How well did you know this?
1
Not at all
2
3
4
5
Perfectly
2
Q

Depositions that aren’t deemed as transfer of value

A
  • no gratuitous intent
  • transfer allowable expenditure for income or corp tax
  • made for maintenance of family
  • caused by death on active service
How well did you know this?
1
Not at all
2
3
4
5
Perfectly
3
Q

chargeable property

A

all property to which a person is beneficially entitled

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
4
Q

all property is chargeable EXCEPT…

A
  • those outside the uk or owned by non-doms
  • certain gov securities held by non uk residents
  • certain heritage properties
  • a reversionary invest in a trust
How well did you know this?
1
Not at all
2
3
4
5
Perfectly
5
Q

Chargeable person

A
  • individual who is dom in the uk is liable for all uk and overseas properties
  • non uk dom is chargeable for uk properties
  • married couples are assessed separately
How well did you know this?
1
Not at all
2
3
4
5
Perfectly
6
Q

transfers which are wholly expect from IHT

A
  • transfers to spouses/ civil partners
  • gifts to charities
  • gifts made for national purposes
  • gifts of pre-eminent property to nation
  • transfers made to maintain heritage property
  • small gifts less than £250 per tax year
How well did you know this?
1
Not at all
2
3
4
5
Perfectly
7
Q

Gifts on marriage are exempt from IHT up to:

A
  • £5000 from parent
  • £2,500 from remote ancestor
  • £2,500 from one party to another
  • £1,000 otherwise
How well did you know this?
1
Not at all
2
3
4
5
Perfectly
8
Q

Annual Exemption

A
  • First £3,000 of lifetime transfer made in any tax year is exempt.
  • unused part can be carried into the next tax year
How well did you know this?
1
Not at all
2
3
4
5
Perfectly
9
Q

Potentially Exempt Transfers (PET)

A
  • The rules state that the individual has to survive for 7 years after making the gift for it to be exempt.
  • charged to IHT if transferor dies within 7 years
How well did you know this?
1
Not at all
2
3
4
5
Perfectly
10
Q

Taper relief - tax charges

A
  • 3 yrs or less … 0% tax
  • 3 ≤ x < 4 yrs …. 20% tax
  • 4 ≤ x < 5 yrs …. 40% tax
  • 5 ≤ x < 6 yrs …. 60% tax
  • 6 ≤ x < 7 yrs …. 80% tax
How well did you know this?
1
Not at all
2
3
4
5
Perfectly
11
Q

Quick succession relief

A
  • available if part of the estate was transferred within 5 yrs of death and was charged to IHT at that time
How well did you know this?
1
Not at all
2
3
4
5
Perfectly
12
Q

Transfer of unused nil rate band

A
  • if one spouse has some unused portion it can be transferred to surviving spouse
How well did you know this?
1
Not at all
2
3
4
5
Perfectly
13
Q

Resident nil rate band

A
  • available for estates which include property
  • RNRB is the lower value of the property and the default allowance.
  • RNRB is reduced if value of estate exceeds £2 mil
How well did you know this?
1
Not at all
2
3
4
5
Perfectly
14
Q

Valuation

A

value of transfer is equal to the open market value

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
15
Q

Admin and payment of IHT

A
  • must deliver accounts of capital taxes within 12 months
  • must pay within 6 months from the end of the month in which the transfer was made
How well did you know this?
1
Not at all
2
3
4
5
Perfectly
16
Q

Business Property Relief (BPR) and Agricultural property relief (APR)

A
  • value of property for IHT purposes may be reduced by 50% or 100% for tax
  • must have owned business property/ used for agricultural purposes for 2 years prior to transfer
  • rate of relief depends on category