Posted on this board under another user a short while back "What is part of the Estate for IHT purposes?" Not sure how to link threads.
In brief Ddad died in early 2018, we (executors) paid IHT on estate and 6 months later received a critical illness insurance payout which had only been applied for after his death (we applied).
HMRC took over a year to review policy and decide it was part of the estate and now want the IHT to be paid on that portion (Happy Christmas to us). Executors and beneficiaries are one and the same (3 siblings).
Took "proper" legal advice which mirrored the advice given here which confirmed we cannot contest this. So we will pay.
What I am angry about (and we have already raised this with HMRC) is that they are charging interest (£5k+) from the date the first IHT payment was due despite not getting the £ until 6 months later, despite telling HMRC of the policy and sending them a copy to review and then taking over 18 months to get back to us.
We are paying for their incompetence!
What rights, if any, do we have to contest this additional interest? I am willing to take this all the way (where I am not sure!) if need be. Would my MP get involved? Is there an appeal process? Honestly no idea.
I would pay it first, making sure it was under protest (so the clock stops as it were) and then contest.
Thanks for any advice.