Probate help please

[LavenderLxx]

I've been on the HMRC and GOV websites all day and am going round in circles trying to make sense of it all so hoped someone clever here might be able to help. To summarise:

• My dad died in Aug 2018. Left everything to my Mum.
• My mum died in Oct 2024. Left everything to my sister and I.

Am I right in thinking their combined Interitance tax threshold is £1m?
(£325k each for nil rate band, plus £175 each for residence nil rate)

Mum's estate would be valued at £850k so therefore under this threshold and not liable for inheritance tax.

I 'think' this makes it an excepted account and therefore ) don't need to submit IHT400 - is this correct?

But do I still have to submit IHT 217 to transfer unused nil rate, IHT 435 to claim residence nil rate and IHT 436 to claim transferable residence nil rate.

Do I have to do all of this before I file for probate?
Thank you!!

If it's an excepted estate you don't complete any of the IHT forms. It's all declared in the probate application.
To have £1M available mum and dad would have to have been married and there would need to be a house worth at least £350k left to direct descendents,

But it won't be an excepted estate if you nee to claim RNRB

You still need to complete IHT 400 even though, as you correctly state, there is no tax to pay. Which supplementary forms you need eg transfer nil rate banding will be listed on IHT 400 as you work through the form.

Forgot to add- you complete IHT 400 and once processed, receive a code for probate application.

Yes they were married and the house is over £325k.
I think it’s the accepted estate criteria that’s confusing me!

That’s really useful thank you

I know they have a bad rep and I'm not sure if it's a separate call number to the self assessment one which will be currently overwhelmed ahead of Friday's deadline, but in my direct personal experience, the HMRC helpline specifically in relation to IHT forms was very knowledgable and helpful.

We were in a very similar situation . Similar amount too. We had to fill in all the IHT 400 and accompanying forms unfortunately .

The residence nil-rate band was introduced in the tax year 2017 to 2018, starting at £100,000 and increasing by £25,000 each year until reaching £175,000 in 2020 to 2021, so if your father died in 2018, you might not get the full u£175k on this particular band, you’d have to take off either £25k or £50k from it.

I don’t think this is correct. My father died in 2000 and my mother in 2024 and full nil rate banding was applicable.

As pp said, the HMRC helpline is very good. I always found them to be kind and knowledgeable. Best time to call is as soon as lines open in the morning, but probably not Monday.

YEs, because your father died in 2020, not in 2018, like the OP's. It's tapered.

He died in 2000, not 2020 ie way before the residence nil rate band was introduced. I thought tapering only occurred if estate was in excess of £2 million.

Sorry, bad eyes!

Different tapering. The £2 million estate IHT issue is something else.

The transferable property band £175k wasn’t fully at that level when it came in 2017.

It started at £100,000, increasing by £25,000 each year, reaching £175,000 in 2020 to 2021. So someone dying in August 2019 wouldn’t have the full £175k band to transfer to a spouse.

So you wouldn’t get the full £1 million allowance when the second spouse died, we found out in July. My brother is an accountant and did our IHT forms (12!) and this subtle point had escaped him, too. I believe we had £975k total IHT bands.

If you have any questions, call 0300 123 1072. This is the IHT helpline. If you do need to produce an IHT400, they will know better than anyone.

i have just been through probate and IHT.
Of all the people I had to call, the IHT team were by far the most helpful - even if you had to wait for ages to get through.

The government website is pretty good at taking you through the steps, but it will all take a lot longer than you want as you need.

1. To apply for a reference number for IHT400 (about 2 weeks)
2. To produce IHT400 and backing IHTs then send off- it took me 6 weeks to get code to apply for probate. You won’t get this until you pay the tax.
3. probate was easy to apply for online, but still took a day short of 16 weeks to be issued. This may be because they had a question re the will - I had to get a signed affidavit from the old solicitor (retired) and it took me 4 days to get. If there are no queries, I understand it is now quicker.

You will need to transfer a. the Nil Rate Band and b. the Residential NRB, at the rate when your DD died. Add this to the current rate allocated to your DM.

A piece of advice I was given was to get professional valuations for large assets eg a RICs valuation for the property and use companies like Equinity for the shares. Well worth the cost as HMRC won’t query them and they will be done on the right basis.

But before all the above, give IHT team a call.

The deaths and probate board on money saving expert has some experienced posters who support people constantly with probate maybe worth a look or posting there too

I'm pretty sure that's not how it works. It's done by %. The father passed on 100% of his NRB and 100% his RNRB. The mother's estate can use that to claim 100% of the current amounts.

edited to add:
that’s confirmed here https://www.gov.uk/guidance/inheritance-tax-transfer-of-threshold#:~:text=Transferring%20any%20unused%20residence%20nil%20rate%20band,-The%20estate's%20personal&text=This%20means%20that%20even%20if,band%20is%20limited%20to%20100%25.
“It’s the unused percentage of the residence nil rate band that’s transferred, not the unused amount.”

This is what ir says in the HMRC site for the nil-residence transferable band.

’starting at £100,000 and increasing by £25,000 each year until reaching £175,000 in 2020 to 2021’

This shows how the transferable residential band increased from 2017. A first spouse dying in that year wouldn’t have the full £175k. So mine, dying in December 2019, transferred £150k for residential property.

This is wrong (and people repeatedly get this wrong on here). Your spouse transferred 100% of their RNRB to you at the rate that applies at the time of your death. If you die today, there will be £175k RNRB available to transfer to you. The fact that RNRB was only £150k when they died is irrelevant.

The OP said :

• My dad died in Aug 2018. Left everything to my Mum.

In August 2018, the transferable property band (RNRB) was £125,000. So even if a second spouse dies at a later date, when the RNRB was higher, you only apply that rate to them, not the pre-deceasing spouse. So £125k plus £175k. So £300k for the two RNRBs (£175k and £125k). Not £350k in total.

Then the two other thresholds of £325k each— £650k.

£650k + £300k=£950k

Not £1,000,000, because the first parent died in August 2018.

That is incorrect.

"It's the unused percentage of the residence nil rate band that's transferred, not the unused amount"
From here: www.gov.uk/guidance/inheritance-tax-transfer-of-threshold#:~:text=Transferring%20any%20unused%20residence%20nil%20rate%20band,-The%20estate's%20personal&text=This%20means%20that%20even%20if,band%20is%20limited%20to%20100%25

This site also says:

Work out the percentage of residence nil rate band that was not used when the first of the couple died.
Multiply the percentage of unused residence nil rate band when the first of the couple died by the maximum residence nil rate band available at the time of the survivor’s death. This gives you the sum available to transfer.

This is not correct. My father died in 2000 when there was no rnrb and the nil rate banding was I think 225 or 250k. My mother was the sole beneficiary of the estate. When my mother died in 2024, 175k and 325k was applied to her estate ie the rates applicable in 2024 and at 100% as she was the sole beneficiary of my father’s estate.
it would make no sense that if the first spouse died in 2018 that a lower amount would be applicable, than if the first spouse had died when the residence banding didn’t even exist.

I posted the correct information and still someone gets it wrong...

The RNRB when OP's father died was indeed £125,000. He did not use any of it, so 100% of the RNRB is available to transfer to OP. That transfer happens at the current rate, NOT the rate when he died. So, even though the RNRB when he died was only £125,000, there is £175,000 RNRB available to transfer to her mother.

This is all set out on IHT436. You calculate the percentage of the father's nil rate band that was unused, then apply that percentage to the current rate of RNRB to figure out how much can be transferred to the mother.

You are correct and I am not