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Sir,
I would like clear a doubt with respect to the solution for inheritance tax question.
The following is part of the question appearing in BPP revision (Question no- 140)
Under the terms of her will, Kendra has left her entire estate to her children.
The nil rate band of Kendra’s husband was fully utilised when he died ten years ago.
For the tax year 2015/16, Kendra will pay income tax at the higher rate.
In the solution given by them, it is considered that nill rate band of the Kendra has been fully utilized. I do not understand on what basis such assumption can be made as it is clearly mentioned Kendr’s Husband nill band has been utilized.
Kindly clarify
The only way that the nil rate band (NRB) is not to be used when taxing the chargeable estate is if it has already been used against the lifetime transfers made within the 7 years before death – and that I cannot answer from the information provided above.
The fact that her husband has used his NRB simply means that there is no unused NRB to transfer to the wife now upon her death so she simply has her own NRB to use.
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