Help- Inheritance tax/Probate laws in UK. If you leave about £40k when you die do you have to pay tax on it?

Question

My partner's wife died in Jan 2007. The house they owned [worth £425,000] was in both their names and she left about £40k in her bank account which passed to him in her will.

Since he is the survivor does he have to pay any form of taxation on either the house or the money left. I phoned the tax office and what they were saying was quite confusing. I am trying to deal with this whole thing for him as he is finding it hard to deal with his own affairs. I am his new partner.

Answer 1

No inheritance tax on transfers between spouses. If he is the executor he will however have to complete an form for the Revenue, I think an IHT200, detailing her estate and who she left it to.

Answer 2

take a look here www.bbc.co.uk/workinglunch they have covered inheritence tax and should have something on here to help you.

Answer 3

If they were still legally married when she died I don't think he has to pay any tax on it.

The CAB will be able to advise.

Answer 4

i believe that a spouse does not have to pay inheritance tax and even if it is payable the limit is 200,000 something. for info try putting inheritance tax in yahoo search

Answer 5

No. Transfers between spouses are not liable to IHT. The husband will be able to use his deceased wife's IHT allowance plus his own when he dies. So he wil have 2x the allowance. I think it is £325000, so that will be £650000 allowable.

Were there any life-time gifts to children etc. If these were made less than 7 years ago, they will be liable to IHT and therefore would be deducted from the allowance.