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shaunak22
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transferable nil rate band between married couples
QUESTION-
Robert and Claudia were married for many years until the death of Robert on 10 April 2020. In his will, Robert left his death estate valued at £100,000 to his sister. He had made no lifetime transfers.
Claudia died on 12 January 2021 leaving a death estate worth £850,000 to her brother, so the residence nil rate band is not relevant. Claudia had made a gross chargeable lifetime transfer of £50,000 in 2017.
ANSWER
CHARGABLE ESTATE – 850000
NRB AVAILABLE 325000
ROBERT UNUSED(325000-100000) (225000)
LESS 7 YEARS BEFORE DEATH 50000 (500000)DOUBT-
1) While calculating roberts unused pay why did we subtract 100000 should’t we have subtracted 94000 since the he had made no lifetime transfer so annual exemption of previous 2 year would be available making the 940000(100000-3000-3000)
2) & Also they havent mentioned that it is a gross chargeable lifetime transfer so why haven’t we subtracted the annual exemption of this month and the previous month
Tax Tutor
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1. If you had read the study notes and watched the lectures you would know that the AE does not apply to the death estate
2. If this refers to Robert then as stated above it is a transfer on death it is NOT a lifetime transfer and if your query relates to Claudia then it clearly does mention that it is a “gross chargeable lifetime transfer”
I would also note that you have to be far more careful in what you write as you have made several errors in what you have written – if you were to do this in the exam it could create big problems for you!
shaunak22
Tax Tutor
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