In these times when many people have found less income is available, the investigation department of HM Revenue & Customs (HMRC) has been busy.
During the 2019/20 tax year HMRC has reviewed and investigated a total of 5658 estates. The conclusion of these investigations has resulted in a further £274,000,000 in additional IHT being charged.
The examination of these reviews proves that the revenue is starting to put large resources into tracing these underpayments.
HMRC are also aware that people may try to overstate the effect of coronavirus on the economy, particularly in property values. They won’t turn a blind eye to this, and already appear to be attacking a larger number of estates who are showing a fall in value that is sharp and not credible.
The other area of examination is with lifetime gifts being forgotten from the deceased’s estate. We would also remind everyone that all large gifts made 7 years prior to death, must be declared and are likely still to be subject to the full 40% tax levied in most cases.