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Where Taxpayers and Advisers Meet

Paying CGT after 7 years.

skidmark66
Posts:11
Joined:Sun Nov 13, 2016 10:41 am
Paying CGT after 7 years.

Postby skidmark66 » Fri Jul 08, 2022 3:15 pm

I will try and be brief.
Estate worth 1.25 million at DOD. Executor only valued estate at 675k and submitted relevent paperwork to HMRC and assumed all was ok because never heard back from them. Incidentaly the executor used both parents NBR.
Some 6.5 years later estate finalised and sold for 1.610 million. What is the likely outcome here when the executor tries to pay any CGT on this. My believe is that the executor has gone to seek advise from HMRC either because the executor either is stupid or got cold feet at this late stage. incidentally im a benificary of said estate and have been trying to get the executor to see sense but allas i failed misserably.

bd6759
Posts:4262
Joined:Sat Feb 01, 2014 3:26 pm

Re: Paying CGT after 7 years.

Postby bd6759 » Sat Jul 09, 2022 1:11 am

Is there a question in here?

Samson22
Posts:58
Joined:Mon Aug 17, 2020 10:54 am

Re: Paying CGT after 7 years.

Postby Samson22 » Sat Jul 09, 2022 1:33 pm

Is there a question in here?
I wager he was asking whether if paying the high capital gains tax bill will alert them to the huge evasion of inheritance tax.

I am rather surprised they did not pick up on it given that gifts etc aside there would have only been around £12k in tax which is rather convenient is what I would think.

skidmark66
Posts:11
Joined:Sun Nov 13, 2016 10:41 am

Re: Paying CGT after 7 years.

Postby skidmark66 » Sat Jul 09, 2022 4:16 pm

The question was in there as in what would be the likely outcome. Samson22 answered it me thinks. I forgot to add that there was a couple of small debts and funeral expenses which basically bought the tax burden to a few hundred pounds which the executor paid. Im thinking as relevant paperwork has been filed and tax paid HMRC are probably thinking the estate has been finalised.
My concern now is if the executor goes cap in hand to HMRC and says oh sorry i forgot about this 950k Mr taxman is going to ask a lot fo awkward questions.
Would this be a fair assumption?
Thanks.

pawncob
Posts:5090
Joined:Wed Aug 06, 2008 4:06 pm
Location:West Sussex

Re: Paying CGT after 7 years.

Postby pawncob » Sat Jul 09, 2022 7:45 pm

https://www.gov.uk/hmrc-internal-manuals/compliance-handbook/ch56800
With a pinch of salt take what I say, but don't exceed your RDA

Samson22
Posts:58
Joined:Mon Aug 17, 2020 10:54 am

Re: Paying CGT after 7 years.

Postby Samson22 » Sat Jul 09, 2022 9:23 pm

The question was in there as in what would be the likely outcome. Samson22 answered it me thinks. I forgot to add that there was a couple of small debts and funeral expenses which basically bought the tax burden to a few hundred pounds which the executor paid. Im thinking as relevant paperwork has been filed and tax paid HMRC are probably thinking the estate has been finalised.
My concern now is if the executor goes cap in hand to HMRC and says oh sorry i forgot about this 950k Mr taxman is going to ask a lot fo awkward questions.
Would this be a fair assumption?
Thanks.
For what What its worth call it possibly very immoral but the executor is liable for the inheritance bills thus they would not go after and you as beneficiary so I dont think you personally would need to worry. (but maybe if no luck with him they go after you I really don't know) I read somewhere executor paid a inheritance tax bill only for the beneficiary not reimburse for amount paid from the was estate.

re the cgt if they looked into the matter it would be obvious something has cracked on but if they fail to do so they would just process it like so many returns but they sure have a long time limits for you to look over your shoulder to say the least. Not to mention the penalties would take the amount payable even higher

As i stated earlier without knowing the full details of what the 600k in assets omitted were I am just staggered they did pick something up with all the tech they have.

But perhaps some more esteemed and informed have more pertinent thoughts than I will come your way.

Samson22
Posts:58
Joined:Mon Aug 17, 2020 10:54 am

Re: Paying CGT after 7 years.

Postby Samson22 » Sat Jul 09, 2022 9:27 pm

For point of the obvious all this could have been avoided had you got the executor to do it correctly. Mistakes presumably are made all the time but this is beyond that. And while I agree 40% above £650k is a high rate but as a sole beneficiary (or so it seems) you would have still have one heck of a lot.

skidmark66
Posts:11
Joined:Sun Nov 13, 2016 10:41 am

Re: Paying CGT after 7 years.

Postby skidmark66 » Sun Jul 10, 2022 11:25 am

Samson22 i agree 100% the executor has been absolutely crass and selfish and will now possibly pay the price. Regarding your reply about the tech that HMRC have its like all pc it can only act on input of info. The estate was never fully disclosed only part of it which was sold a few years back. Now the rest of the estate has been sold a few years later the executor is now wondering what the hell to do. I cant see how on earth HMRC are just goung to let the executor off. Maybe the executor thinks they will say oh no worries thanks for letting us know pay us when your ready. Beneficiaries are now asking well where is our money.

bd6759
Posts:4262
Joined:Sat Feb 01, 2014 3:26 pm

Re: Paying CGT after 7 years.

Postby bd6759 » Mon Jul 11, 2022 11:32 am

The estate isn’t finalised. It seems from what you are saying the executor is trying to correct an earlier mistake. I don’t see any problem. The estate will pay its debts and the beneficiaries will get what is left.

skidmark66
Posts:11
Joined:Sun Nov 13, 2016 10:41 am

Re: Paying CGT after 7 years.

Postby skidmark66 » Mon Jul 11, 2022 7:56 pm

Your assumption would be correct if the executor hadn't lied about the valuation of the whole estate at DOD.
Whole estate valued at DOD 1.25 million BUT the executor filed on probate forms and IHT forms at 675k less a couple of small debts. When executor thought the dust had settled he decided to sell remaining assets and got a major headache when the assets realised at 910k.
Trust me when i tell you its been one major pack of lies since day one.


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