Many estates could be entitled to significant inheritance tax rebates if property prices continue to fall.
The economy is worrying for many as political uncertainty continues to destabilise many business sectors including the property market.
Whilst this is a worrying time for sellers that may be forced to sell their properties for less than a year ago, for executors dealing with probate house prices could have a huge impact on the overall inheritance tax (IHT) an estate is liable to pay.
According to research into the recent House Price Index by the Office for National Statistics, conducted by NFU Mutual, house prices for many areas of England fell by 0.9% in the year to July 2019.
So executors that may find themselves selling the property of the deceased for a lower value within four years of the death should ensure they reclaim the tax paid on the loss by completing an IHT38 form.
Following a decade of consistently rising house prices and favourable pension schemes, the NFU have speculated that around 1.4 million UK estates are valued at somewhere close to or in excess of the current threshold of £325,000 and are teetering on the edge of an IHT black hole.
Unbeknown to the estate owners, the increasing equity in property in recent years has left a mass of people on the brink of IHT liabilities.
But as prices contract in the current climate, many estates should now ensure they reclaim additional inheritance tax paid in the past by using the IHT38 process.
For further advice on this and other probate related issues call us now on 01299 251442