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Tax Notes

LPC Law Notes > Private Client Notes

This is an extract of our Tax document, which we sell as part of our Private Client Notes collection written by the top tier of Cambridge And Oxilp And College Of Law students.

The following is a more accessble plain text extract of the PDF sample above, taken from our Private Client Notes. Due to the challenges of extracting text from PDFs, it will have odd formatting:

Elective: Private Client

TAX:

1. Inheritance Tax [IHT] Checklist

IHT payable when the gift was made:

1. Does the gift carry with it any liability [e.g. mortgage / charge on shares]

2. Exemptions:

*
spouse 100%

*
charity 100%

*
political party 100%

*
Business property relief

*
small gifts

*
normal expenditure

*
marriage

3. 4.

5. 6. PET

Annual exemptions [check dates]
Equals = Value of the PET / LCT Gross up any LCT if donor is paying tax. TAX: No IHT payable The PET is ignored while Peggy is alive The value of the PET does not affect the Cumulative Total

LCT 1

*

*

LCT 2

*

NRB Option 1: "The LCT1 made more than 7 years before LCT 2. The PET is ignored therefore the whole NRB is available [check NRB table of that year]"

*

NRB option 2: "The LCT1 was made in the last 7 years before LCT2 therefore it effects the NRB available. The NRB is now [NRB of this year - cumulative total]"

*

*

NRB in the YEAR of the gift [check table]
Tax at 20% if it exceeds the NRB

NB. No taper relief at this stage Valuation issues? [10% discount]

IHT payable on LCTs / PETs at date of death:

1. Transferable NRB?

2. "x dies on DATE. The 7 year period runs from DATE"

3. NRB transferable- transfer the appropriate % proportion not used

4. Work chronologically:

1

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