What is Inheritance Tax?
Inheritance tax is paid on an estate after
the owner dies. However no tax is charged for an estate that
is below the current
inheritance threshold. For the purpose of inheritance tax,
an estate is considered inclusive of assets held in trust,
as well as gifts given within 7 years of death.
General Exemptions
Normally if the estate’s
value is greater than the current specified threshold then
the inheritance tax applies. However
there are tax exemptions on certain parts of the
estate:
- Assets bequeathed to a spouse.
- Donations
made to registered charities in the UK.
- Outstanding
bills at death, including funeral expenses.
Due Date Representatives need to pay for the
tax that applies on delivery of their Inland Revenue Account.
However,
in case of taxes
related to death, the due date is 6 months from the
month the person died.
Just as with any other type of tax
payment, interest will be applied to late payments not
made within the specified
due
date.
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