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Where Taxpayers and Advisers Meet

Registering estate for income tax and CGT

Brightonian
Posts:117
Joined:Wed Aug 06, 2008 3:31 pm
Registering estate for income tax and CGT

Postby Brightonian » Wed Apr 28, 2021 3:45 pm

I am dealing with a straightforward estate where the main asset is a house. The Probate Value given on IHT400 was £900,000 but it sold for £875,000. I have made a claim for IHT relief on IHT38. The PRs will have no CGT to pay. I looked at the HMRC website and it states that the estate must be registered for tax where the PRs dispose of assets worth more than £500,000 in any tax year. However, further down the page, it states that the estate should register by 5 October after the end of the year in which the estate starts to have income or 'has chargeable gains on which tax is payable.' This seems to suggest that you do not need to register if there is no tax payable. On the other hand, the PRs have sold an asset worth £875,000. I should be grateful for views on this matter. Apart from the house, there is just some bank deposits which have already been paid to the beneficiaries, s it does not meet any of the other criteria for registration.

Lee Young
Posts:2697
Joined:Wed Aug 06, 2008 3:26 pm
Contact:

Re: Registering estate for income tax and CGT

Postby Lee Young » Mon May 17, 2021 5:36 pm

Strictly you should register as your estate is "complex" due to the value of the single asset sold. But as you have detemind, it will be a waste of your time as no tax is due.
Lee Young
Solicitor, Chartered Tax Adviser and Trust and Estate Practitioner


Partner, Frettens LLP
lyoung@frettens.co.uk
01202 491701

Brightonian
Posts:117
Joined:Wed Aug 06, 2008 3:31 pm

Re: Registering estate for income tax and CGT

Postby Brightonian » Tue May 18, 2021 10:29 am

Thank you for taking the trouble to reply. Having thought about it, I propose to write to HMRC and explain the position, just to cover myself.
Again, many thanks.


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