Inheritance tax

This is the name given to the tax which has to be paid on an estate following someone's death.

Inheritance tax is the tax that you may have to pay when the total estate of the person who has died exceeds a certain amount.

In 2012-2013 the threshold is £325,000 so if the dead person's estate is valued at less than this amount there will be no Inheritance tax to pay. Over this threshold Inheritance tax is payable at 40% on the amount over £325,000. 

To decide the value of the estate all assets must be added up and any debts, including funeral expenses, must be deducted.

Generally Inheritance tax is paid by the executor of the will from the deceased person's estate. It should be paid within six months of the end of the month in which the deceased died, interest will be charged on any amount outstanding.

Find out more about Inheritance Tax and the probate process.

 

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