Reporting to HMRC & Payment of IHT Flashcards
What is the deadline for submitting the IHT 400 form to HMRC?
A) 12 months from the end of the month of death
B) 6 months from the date of death
C) 3 months after the date of death
D) 18 months after the date of death
A) 12 months from the end of the month of death
Explanation: The IHT 400 form must be submitted to HMRC within 12 months from the end of the month in which the deceased died.
Which of the following estates qualifies as an exempt excepted estate?
A) A £3.2 million estate, left to a spouse
B) A £400,000 estate left to a child, with 100% business property relief applied
C) A £2.5 million estate left entirely to a charity
D) A £1 million estate where no IHT is due because of taper relief
C) A £2.5 million estate left entirely to a charity
Explanation: An exempt excepted estate must have a gross value under £3 million and no IHT payable due to spouse or charity exemption.
Which of the following assets qualify for the IHT instalment option?
A) Shares in a private company where the deceased had control
B) Money held in a bank account in the deceased’s sole name
C) Valuable artwork collection left in a will
D) Rental property used as an investment
A) Shares in a private company where the deceased had control
Explanation: The IHT instalment option is available for business assets, land, and company shares giving control, but not for investment properties or personal assets.
A person dies leaving a £4 million estate to their children. When must the IHT be paid to HMRC to avoid interest charges?
A) 3 months after death
B) 6 months from the end of the month of death
C) 12 months from the end of the month of death
D) Before probate is granted
B) 6 months from the end of the month of death
Explanation: IHT must be paid within 6 months from the end of the month of death to avoid interest charges.
A man dies, leaving an estate worth £1.8 million to his daughter. He had previously inherited a property from his father 3 years before his death, which was subject to IHT. How does Quick Succession Relief (QSR) apply?
A) QSR reduces the IHT payable on the estate
B) The daughter must pay full IHT on the inherited assets
C) QSR does not apply unless the death occurred within 2 years
D) No IHT is payable at all under QSR
A) QSR reduces the IHT payable on the estate
Explanation: Quick Succession Relief applies when inherited assets were taxed within 5 years and reduces the IHT payable on those assets.
A widower dies with an estate worth £850,000. His late wife had not used any of her nil rate band (NRB). What is the total NRB available for the estate?
A) £325,000
B) £650,000
C) £500,000
D) £850,000
B) £650,000
Explanation: A surviving spouse can claim the unused portion of their deceased spouse’s NRB, meaning the estate benefits from two full NRBs, totalling £650,000.
A man inherits a property from his father, who passed away three years ago. IHT was paid on the father’s estate. If the man dies today, how does Quick Succession Relief (QSR) apply?
A) No relief applies since the property was inherited more than one year ago
B) QSR only applies if the father’s estate was under £500,000
C) QSR eliminates all IHT due on the property
D) QSR applies, reducing the IHT charge on the inherited property
D) QSR applies, reducing the IHT charge on the inherited property
Explanation: Quick Succession Relief (QSR) applies if assets were taxed in the last 5 years and are inherited again, reducing the IHT charge.
A man dies leaving an estate worth £1.8 million, which includes farmland worth £800,000. The farmland qualifies for Agricultural Property Relief (APR). What is the taxable value of his estate after APR?
A) £1.8 million
B) £1 million
C) £800,000
D) £0
C) £800,000
Explanation: APR removes the agricultural value from the taxable estate. After deducting the £800,000 farmland, £1 million remains taxable.
A man dies leaving his estate of £1.5 million to his children. He had inherited £500,000 from his spouse, but the spouse’s PRs had not claimed the unused NRB. What is the total NRB available for the estate?
A) £325,000
B) £650,000
C) £500,000
D) £850,000
C) £500,000
Explanation: The PRs must actively claim the transferable NRB (TNRB). If not fully claimed, only a portion applies.
A deceased person’s estate includes woodland worth £400,000. The PRs elect to use Woodlands Relief. What happens to the IHT liability?
A) The IHT is deferred until the timber is sold
B) No IHT is payable on the woodland
C) The estate is immediately relieved of all IHT liabilities
D) The PRs must still pay IHT on the land but not the trees
D) The PRs must still pay IHT on the land but not the trees
Explanation: Woodlands Relief applies only to the value of the timber, not the land itself.
