Who pays IHT when caveat lodged


(Roland Borriello) #1

We are dealing with an estate where a caveat has been lodged . The validity of the will is being contested.
IHT 400 has already been lodged and inheritance tax is due. Interest is now accruing. It is my understanding that the Executors do not have authority to pay the inheritance tax while the caveat is in place.
I have seen in a HMRC manual a similar example which suggests a Grant Pendente Lite is applied for. Do members agree this is the best way forward or am I wrong and can the executors simply pay the IHT ?

Roland Borriello
Northwood Banks & Co Ltd


(Paul Saunders) #2

I believe an ad colligenda grant may be appropriate in these circumstances, enabling the assets to be collected in.

Care should be taken in the application as I understand the authority under the grant may limit the realisation of some assets (e.g. land and property) and the grant, itself, does not automatically confer on the administrator so appointed the right to be remunerated.

HMRC may still require the IHT to be paid before the grant might be issued!

Paul Saunders


(malcfinney1) #3

If the grant ad colligenda is limited to simply collecting in and preserving the deceased’s estate and not allowing distribution to beneficiaries would it not be worth approaching HMRC to ascertain if they would agree to not requiring an Account to be filed?

Malcolm Finney