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TonyTax
TonyTax, Tax Consultant
Category: Tax
Satisfied Customers: 15950
Experience:  Inc Tax, CGT, Corp Tax, IHT, VAT.
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Please can you advise as to how long after the executors have

Customer Question

Please can you advise as to how long after the executors have signed hmrc Inheritance tax
form C4 and handed to solicitor we should expect to have to reasonably wait for finalisation and also is there any reason why the solicitor should delay payment to you for some 72 days. The solicitor acting for the executors is telling us that these delays are a result of hmrc slow response and is entirely out of their control. As chief executor I am finding it difficult explaining the time element to many of the beneficiaries. Your help will be much appreciated.

Many thanks XXXXX
Submitted: 4 years ago.
Category: Tax
Expert:  TonyTax replied 4 years ago.

Hi.

Can you tell me how long ago the original IHT submissions to HMRC were made and the reason as to why a corrective account was necessary please. What is the sze of the tax repayment due? Can you explain the 72 day delay and what payment you are referring to, a repayment of IHT or the distribution of the estate?

Customer: replied 4 years ago.

I do not have the exact date that original IHT submissions were made but a substantial tax payment was made early in 2012. The reason why a corrective account is due to the fact that a substantial part of the estate was a militaria collection which, on the advise of specialist auctioneers was sold over a period of some two years. The final tax repayment due was £10,296.


I am asking you if there is any reason why a solicitor should take 72 days to


make this payment!


 

Expert:  TonyTax replied 4 years ago.
Thanks.

Leave this with me while I draft my answer.
Expert:  TonyTax replied 4 years ago.

Hi again.

If a corrective account is made after IHT has been paid by the executors, it is entirely possible that the tax office will take a close look at the reason for the correction before any tax repayment is issued. There are no specified time limits for the tax office to process claims but I suggest to anybody acting on their own account that they chase up their issue once a month and after three months have passed without a resolution they should make a formal complaint.

I clearly am not privy to what correspondence has passed back and forth between HMRC and the solicitor but it is possible that the tax office have questions which need answering before they release the tax repayment. In my experience, having dealt with many deceased estates, I have not heard of a situation where a solicitor has held onto a tax repayment for 72 days once it has been made. If that has happened, you should make a complaint to the Law Society.

Assuming that the repayment has not been made, the solicitor should be chasing HMRC regularly as I explained earlier and keeping the lead executor appraised of the situation. If I were the solicitor I would at least try to pin HMRC down to a time frame for dealing with the correction and usually the HMRC offices which deal with estates are more efficient than the non specialist tax offices. Sometimes, however, the tax office won't commit to a time frame and you may be unfortunate in having your case handled by an HMRC office which is short of staff. The only way to handle HMRC is firmly I'm afraid. I've taken over estate tax work from solicitors in the past and, whilst its not always the case, they seem to have a way of doing things which they won't delineate from regardless of delays.

As lead executor, you should ask for chapter and verse from the solicitor as to what is happening and instruct them to be more pro-active. I have to say, though, that if the corrective account was submitted 72 days ago, I wouldn't consider making a complaint for another 18 days.

I hope this helps but let me know if you have any further questions.