To my shame I should know this but don’t
A and B married
A dies, all to B, B got 100% TNRB from A
B Marries C
B dies leaving 325k to son residuary estate to C
Can estate of B claim only A’s TNRB ( and not use B’s NRB) therefore leaving C with own NRB and B ‘s TNRB?
Or would 650k need to be given to son on B’s death to use A’s TNRB
Yes, the estate of B can keep its own NRB for C’s estates benefit.
Many thanks for clearing that up for me
My understanding is that on B’s death his estate has a maximum total NRB of 650K made up of B’s own NRB [325k] increased by the % of A’s unused NRB [325k] (IHTA 1984 s8A(3)).
On B’s death, of the 650k total NRB 325k [gift to son] is utilised leaving 325k [or 50%] unused and available to transfer to C on C’s death.
As such, it is not the case that the PRs of B’s estate are claiming to use the NRB transfer from A’s estate leaving B’s own NRB available for transfer to C.
Under IHTA 1984 s8A(3) the survivor’s maximum NRB includes any transferable NRB “for the purposes of the charge to tax on death”. It is thus not the case that any use of the total NRB can be split between the “normal” NRB and any transferable element. Having said this, it is worth noting that no part of any unused transferable NRB can be used against any IHT chargeable on lifetime transfers made by a survivor (but can still be used for use against IHT on on failed PETs and additional IHT on chargeable lifetime transfers made within seven years of death).