I am going round in circles and would be grateful for views on the following.
Jointly owned property, deceased’s 50% share passed to residue the whole of which is given to a sole beneficiary who is a qualifying beneficiary for the purpose of RNRB and the estate is taxable.
The share is valued at less than the applicable RNRB so not much point in applying joint ownership discount.
There are a number of legacies to be paid out of the residue. Cash in residue will not be sufficient to satisfy all the legacies, plus the tax, which will mean the share of the residence will have to be used in part to satisfy the legacies, and also the tax.
I am not able to decide whether the amount of RNRB to be applied will equal to the gross value of the deceased’s share, or whether it will be the net value that the qualifying beneficiary receives after settling legacies, and whether it will reduce further
to take account of IHT payable.
Answer from the IHT helpline was that the RNRB will be equal to the gross value of deceased’s share even if some of it is used to settle legacies, but their guidance notes say that if the residence is shared with non-qualifying beneficiaries then RNRB applies
only to the share that the qualifying beneficiary receives.
Thank you,
Viju Chhagan