IHT Instalments Option

Trusts Discussion
1

Hi there

I am struggling to get assistance from HMRC regarding a payment schedule of instalments options for their tax account.

Clients have elected to pay instalments on the account for the time being. First payment is due in 3 weeks which they have all set aside. I understand that there is no interest due on 1st instalment as the payment will not be late.

When working out the next 9 instalments - how can i work out what interest they will need to pay? Do the clients go onto the IHT calculator and input this themselves? they seem to be only able to do this within two weeks of the date it becomes due? which leaves them little time to sort the funds in advance?

is it usual that HMRC do not send out details before the instalment payment is due? has this always been the case or a recent thing? seems to be setting clients up for a fall if they get it wrong and possible costly mistake

any guidance on this would be appreciated

2

You can’t work out the exact interest far in advance as the interest rates are likely to fluctuate over the next year (and beyond).

3

In the past HMRC always sent a tax calculation before each instalment fell due. That calculation obviously included the interest due. However, I find at the moment that they send such calculations on a sporadic basis. I have received such a calculation in some estates but not in others.

Cliona O’Tuama