HMRC Response timings

Trusts Discussion
1

I am dealing with a Discretionary Trust that has collapsed following the death of the sole beneficiary.

The Trust Document specifies the remaining balance of the trust be distributed to others in full on the death of the beneficiary.

I have notified HMRC of the details and closure of the Discretionary Trust and received a confirmation letter acknowledging the closure including a reference number.

The letter states that a request for further information might follow.

Has anyone any idea how long these requests for information are currently taking or is it dependent on how much time HMRC employees spend working from home whilst walking the dog or whatever it is they do whilst multi tasking with the job they are employed/paid to do?

TIA for input.

2

Were IHT100 forms submitted to HMRC in connection with any exit charges and/or any trust tax returns dealing with any capital gains tax on the distributions (or holdover claims, if appropriate) and was the Trust Register updated accordingly?
The enquiry window for self-assessment tax returns is 12 months from submission, but in such cases or on death, a call or letter to HMRC explaining that the trustees or Executors would like to close their file so would HMRC please either confirm that they do not intend to enquire, or conversely inviting them to enquire, usually elicits a speedy and usually favorable response.
If the trust assets included property that had not been sold on the open market, but rather distributed in-specie then HMRC may choose to involve the District Valuer - this may prolong matters considerably.
It may be worth a call to the office that issued the confirmation letter to ask them if they intend to request further information or if they would please close their file…
Maxine
TC Citroen Wells

3

If it is anything to go by, my recent experience of the time it is taking HMRC to respond to what is IMO a relatively straightforward matter, is not good. Last July, I reported an additional asset which had come to light In an estate where the death occurred in 2017 and which had been wound up in 2019 at which time an IHT 30 had been obtained. The asset comprised a refund of charges which had been levied against the deceased by an investment adviser. I calculated the additional inheritance tax and interest and paid this and requested confirmation of their agreement. As I had heard nothing, I sent reminder In October followed by another in December. At the beginning of February, I received a letter saying that as I was requesting a refund of tax I would need to have a form completed. After waiting some 20 minutes or more, I spoke with someone who agreed with me that the writer of the letter had “got the wrong end of the stick” and that I could expect to receive a reply within a very short time. So far no reply, and I have now submitted a further IHT 30 in the hope that this might trigger some action. Not a particularly good experience for what is undoubtedly a very straightforward matter with nothing for HMRC to do, but agree the figures I submitted.

Patrick Moroney

4

Thank you Maxine and Patrick for your input.

This is by no means a complicated matter, a Discretionary Trust created by the death of the settlor in her Will. The aim of the trust was to provide for the care and needs of one of her Children without passing inheritance directly.

The trust was created in August 23, the beneficiary taking a very rapid downturn in health died in December 23 some four months later.

On receipt of the IDC from HM Coroner the trust was closed and distributed in accordance with the Will.

Declaration was made via the portal and acknowledged with the note, as stated that, in the event of more information being required I would be contacted.

Following Maxine’s advice I contacted HMRC to discuss the matter, I won’t bore with the details but was informed that further information would be requested if required.

Post this I was surprised to receive a request for a self assessment return to be made by the usual time frame.

Taking Patrick’s info as an indicator I contacted HMRC Trust helpline, it was a 50 minute wait but in short thrift was informed the declaration had been received but not applied, that was done by the advisor in a few seconds and I was informed the matter was finalised and no return was required.

However the conversation itself was fraught with gaps and silence presumably due to VOIP characteristics and I was unable to get the advisor’s details.

Possibly belt and braces but I have also referenced this discussion in a letter to HMRC and informed them I consider the Trust closed within the 2 year period and thats the only information required and I shall not be forwarding any return until and unless a written request is made.

Interesting that the portal, a decent and fairly easy yet secure method of passing information both ways is closed on making the declaration automatically rather than leaving this method of access available when a simple update could be made within the portal saying, words to the effect of, all information now collated, trust closed.

Perhaps that might cut down on phone calls.