Nil Bank Rate Passing Between Parents

[trnd777]

My parents were married when my father passed away. Would his nil band rate have passed automatically to my mother in that case ?


I see this rule set from HMRC Transferring unused basic threshold for Inheritance Tax

"You can only transfer threshold if:

. the couple were married or in a civil partnership when the first death occurred

. you send the request to HMRC within 2 years of the death of the surviving spouse or civil partner

But I note no mention of 'or' which I assume was for divorced couples in the instance of the 2nd comment.
Do you have to satisfy both steps or only either one of them for both parents allowances to pass to a child ?

[trnd777]

A C1 form was submitted in good time regarding my father's estate and I assume that would be the time stamp on his unused Nil Band Amount with HMRC passing to my mother.

[AGoodman]

Yes.
It is an AND - you need to satisfy both but time hasn't started running on the second yet. It is your mother's executors/administrators who have to claim the transferrable nil rate band within 2 years of your mother's death. No formalities are required when your father dies.

[trnd777]

Thanks for that. I never knew it was not an automatic roll-over of the nil-band rate to my mother.

[trnd777]

It is crazy that the nil band passing does not happen automatically..another step they can trip us up on which should not be a permission hoop.

[AGoodman]

There's some minor logic for the claim, they want to be able to check how much of the transferable nil rate band is actually free to be transferred.

I agree there is no obvious logic to the time limit.

But if you think that is bad (and have too much time on your hands) you should look at the legislation for the residential nil rate band. The person who drafted that appears to have a grudge against humanity.