Taxation of Administration and Estates

Question 1

Who must complete the deceased’s income tax return covering the period from 6 April to the date of death and pay any amount owed?

Answer 1

Personal representatives

Question 2

What are the tax rates for non savings income and dividends?

Answer 2

Non-savings - 20%
Dividend - 7.5%

Question 3

If a personal representative took out a _____ to pay IHT, interest on it is a _________ payment against income

Answer 3

loan, deductible

Question 4

When are PRs deemed to acquire the assets of the deceased and what is the assets’ base cost?

Answer 4

Acquired at the date of death, at the base cost equal to their market value at death (aka probate value)

Question 5

What type of tax are PRs liable to pay on gains made by them on disposals during the administration period?

Answer 5

Capital gains tax

Question 6

PRs can take an annual exempt amount for the year of ______ and the next _ tax years only

Answer 6

death, 2

Question 7

What are the capital gains tax rates for PRS on general gains and residential property respectively?

Answer 7

General - 20%
Residential - 28%

Question 8

Is a distribution of an asset by the PRs to a beneficiary in settlement of a legacy under the will treated as a disposal for CGT purposes?

Answer 8

No