Shadow housing secretary accusing Sunak of massive ‘Bung’ to Landlords9:57 AM, 13th July 2020
About 3 days ago 27
Taxpayers who have fallen foul of HM Revenue and Customs policy of checking out property valuations targeting larger inheritance tax payments from estates can fight back with a little known loophole.
Refunds on overpaid inheritance tax (IHT) can be claimed for homes that are worth less than the value on the deceased owner’s date of death.
Taxpayers have to meet four basic conditions to claim the money back from HMRC with interest:
Proving these points switches the lesser value for the date of death value and decreases the amount of IHT due.
Check out how a claim might affect the sale of any other land or property by the estate. If other land or buildings were sold and the prices have gone up, the taxman can ask for more IHT.
Time limits for a claim are six year’s from the date of death.
Claim on Form IHT38, which is available for free download from http://www.hmrc.gov.uk/cto/forms/iht38.pdf
HMRC has reviewed around 10,000 IHT cases and raised £70 million in extra tax after revising property values in the past year.
With falling property values over recent years, anyone who has sold a home and paid IHT should look at reclaiming some of the tax with interest from HMRC.
A HMRC spokesman said: “Only about 3% of estates pay any inheritance tax, but when the value of the property can materially affect the tax payable it’s only right that we confirm the value offered.
“This is not an investigation but a routine check which in the vast majority of cases simply confirms the value offered. This helps to protect both the Exchequer and the taxpayer.”
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