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Where Taxpayers and Advisers Meet

IHT Calculation

Posts: 6
Joined: Mon Nov 25, 2019 12:43 pm

IHT Calculation

Postby tax999 » Fri Jan 17, 2020 12:38 pm

Hi, looking for some assistance.

Will leaves £8,000 of legacies to grandchildren “free of government duties in respect of my death and of delivery expenses but without interest”.
House valued at £235,000 to wife.
Residue is split equally between wife, son, daughter and sister.
Full NRB of £325,000 is available.

When calculating IHT do I require to use grossing up?


Posts: 1043
Joined: Fri May 16, 2014 3:47 pm

Re: IHT Calculation

Postby AGoodman » Fri Jan 17, 2020 4:03 pm

To put it in context, how much is the total estate worth?

Posts: 6
Joined: Mon Nov 25, 2019 12:43 pm

Re: IHT Calculation

Postby tax999 » Fri Jan 17, 2020 6:01 pm

Around £800,000

Posts: 7895
Joined: Wed Aug 06, 2008 3:25 pm

Re: IHT Calculation

Postby maths » Fri Jan 17, 2020 8:58 pm

In your scenario the residue is partly exempt and partly non-exempt.

IHT on the specific gifts is borne by the whole of the residue but the IHT on the non-exempt part of the residue has to be borne only by the non-exempt residue ie the exempt part of the residue must not bear any IHT attributable to any other part of the residue.

Grossing up is necessary. Quite a complex calculation.

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