Intestacy and IHT

Hi. I’m hoping that someone can confirm that I’m on the right track here please.

I’m administering an intestacy where the residue is split between the surviving spouse and a child.

Am I correct that I should calculate the residuary shares of the surviving spouse and the non-exempt beneficiary based on re Ratcliffe (i.e. split according to the intestacy rules as varied and then deduct the Inheritance Tax from the non-exempt beneficiary’s share)? And because of that, grossing up isn’t an issue? Any thoughts gratefully received.

Thank you


Yes. Re Ratcliffe concluded that an equal split between exempt and non-exempt beneficiaries would not require that the pre-tax the gifts should be of unequal value so that post tax the two amounts were equal. Thus, where residue is divided between exempt (spouse) and non-exempt (children) beneficiaries no part of the IHT attributed to the non-exempt beneficiaries can be attributed to the exempt beneficiaries.

Malcolm Finney

1 Like

Thanks Malcolm, I really appreciate that. Alison