Pre-Grant Procedure

Question 1

What must the PRs pay in order to obtain a grant?

Answer 1

Inheritance tax (if it’s due on D’s estate)

Question 2

What can a potential PR request banks to do in order to pay inheritance tax/funeral expenses before the grant is obtained?

Answer 2

Release D’s account funds directly to HMRC (known as a direct payment scheme)

Question 3

What 2 other options could a potential PR have to pay IHT?

Answer 3

1. Seek a loan from a bank or beneficiary
2. Sell estate assets that only require a death certificate to prove (e.g. furniture, jewellery, cars)

Question 4

The initial payment of IHT must be made before the personal representative can apply for the grant

Why would an estate that includes a house/property not be available for an executor to fund an initial payment of inheritance tax?

Answer 4

Because a deceased’s home can’t be sold before a grant has been obtained

(note, the same rule applies to shares)