Module 19 - Inheritance Tax

Question 1

Life assured and beneficiary same person

Answer 1

Proceeds from policy go into deceased’s death estate

Question 2

Life assured and beneficiary different people

Answer 2

Proceeds bypass deceased’s estate and go directly to beneficiary

Question 3

Related property formula

Answer 3

Deceased % / (deceased % + spouse %)

X

Total share of both spouses

Question 4

NRB can claim =

Answer 4

NRB available (£325,000) - chargeable transfers in previous seven years

Question 5

Lower IHT rate

Answer 5

36%

Question 6

Lower IHT rate used when donation is

Answer 6

At least 10% of baseline amount

Question 7

Baseline amount

Answer 7

Amount of net chargeable estate before deduction of charitable donation and after deduction of available NRB. No deduction for RNRB

Question 8

Quick succession relief

Answer 8

Tax on transfer one x (net value of transfer one / gross value of transfer one) x relevant %

Question 9

Amount of transfer qualifying for BPR

Answer 9

Inheritance x (total assets - excepted assets) / total assets

Question 10

When a farmer owns a farm and runs it as a farming business

Answer 10

APR and BPR may both be available. APR given in priority (A before B)

Question 11

Vacant possession

Answer 11

12 months in book but extended to 24 months by extra statutory concession

Question 12

APR relief - 50%

Answer 12

Landlord with a pre September 1995 lease and more than 2 years to run on the lease