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tom’s estate includes the following assets
1- 50% shares in racehorse valued 150k
2- cash winnings o betting racehorsing of 40k
3-his main residence valued at 875k which has outstanding repayment mortagage of 500k. what is the net value to be included in tom’s chargeable death estate ?
available ans options given are
0,40k,150k,200k,375k,700k,875kIncluded in the death estate:
– the share of the racehorse (is the SHARE valued at £150,000, or is the RACEHORSE valued at £150,000)?
– the cash of £40,000
– the main residence less the mortgage, so £(875,000 – 500,000) = £375,000
So none of the options fit, as depending on the racehorse, the answer is either £(150,000 + 40,000 + 375,000) = £565,000 or £150,000 x 50% = £75,000, plus £40,000, plus £375,000 = £490,000.
well the ans were just matching individual amts agaisnt the sets . my doubt here is y is man residence 375? like y r we not deducting the 175k rnrb?
The RNRB is an extra amount of the death estate taxed at 0%, it is not deducted against the value of the property.
So if the death estate is valued at £800,000 with the full RNRB and NRB available, then the IHT would effectively be:
£175,000 (RNRB) x 0%
£325,000 (NRB) x 0%
£300,000 x 40% = £120,000Total £800,000, but some taxed at 0% and some taxed at 40%.
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