I am completing an IHT400 form for my mother’s estate.
My father died in 2010. According to solicitors’ letters accompanying his will, dated 2002, this set up a Nil Rate Band discretionary trust. My mother, my sister and myself are named as trustees.
I understand that, if valid, assets in this trust would not be considered part of my mother’s estate and, therefore, not liable for inheritance tax. We would like this to be taken into account by HMRC but are unsure how to communicate it using the IHT forms.
It seems any values entered in the IHT418 ‘Assets held in trust’ schedule should ultimately end up added to the IHT400 ‘Total chargeable estate’ value, which seems the opposite of what we want to claim.
The HMRC forum advised speaking to the HMRC Inheritance Tax Helpline about this. The helpline people suggested, hesitantly, that I send an accompanying letter – in addition to the relevant documents - with my IHT400 submission explaining that I wish the trust to be taken into account, if valid.
As the helpline people seemed a little unsure I wanted to ask, has anyone with experience of dealing with HMRC found that they will give consideration to accompanying letters or am I limited to trying communicate the situation using just the official forms?
Thank you.
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