IHT 435

[piper777]

Hi There

can someone clarify. on filling in IHT 435 question 14 it asks how much transferable nil rate band are you claiming.
My father recently died, my mother died several years ago. Father sold the marital house in 2018. No RNRB was used
Is the transferable amount the year rate available on disposal of house, or the amount as in year of my fathers passing?

Thank you for any help

[maths]

IHT 435 deals with the "RESIDENCE nil rate band" (RNRB) not the "nil rate band".

On father's recent death his estate may be able to claim his own RNRB plus any amount of mother's RNRB which she didn't use. To ascertain the amount of unused RNRB of mother simply take the amount she did not use as a % of the RNRB available in the tax year of her death; so for example, she may have not used 75k out of the 175k available at the date of her death giving 42.86%. Father's estate can now have in addition to his own 175k an amount of 42.86% x 175k ie 75k. Total RNRB for father 175k plus 75k ie 250k.

[piper777]

Thank you Maths

Sorry my mistake i did mean RESIDENCE nil rate band" (RNRB) not the "nil rate band".

Your explanation makes it clear as to calculation , so the date of disposal of house makes no difference? if none used by my mother the full 175K can now be transferred to fathers estate, and 175K entered in box 14?

if u would be so kind to conform

thank you Maths

[maths]

As you know the maximum RNRB changed each tax year:
17/18 100k
18/19 125k
19/20 150k
20/21 and thereafter 175k.

If mother died pre 6 April 2014 when there was no RNRB then. mother cannot have used it; in which case on death of father in say 21/22 or 20/21 his max RNRB of 175k would be doubled to 350k.

I suspect even if mother died on or after 6.4.17 her estate didn't use any of her RNRB in any event in which case as above father gets 350k maximum.

The relevance of the house sale by father is that at the date of his death there was not any residence/house for him to leave in his will on his death to his lineal descendants (eg children). In such a case in order for father's estate to actually use the max 350k RNRB will require that in his will he leaves any assets in his estate up to 350k to his children.

[piper777]

thank you Maths that is very helpful