HMRC internal manual

Inheritance Tax Manual

IHTM05071 - Particular aspects that may arise in connection with obtaining a grant: grants on credit

Under IHTA84/S226 (2) personal representatives (IHTM05012) (PRs) are required to pay all the tax for which they are liable on delivery of an account before they can obtain a grant (IHTM05001). However, in very exceptional circumstances they may obtain a grant before paying tax if they can demonstrate that it is impossible to raise the money before obtaining the grant.

Any request for a grant on credit (IHTM05120) (a request to postpone payment of tax other than that on instalment option property until after the grant) will be dealt with by Service Technical Support (STS).

STS will make sure that any necessary steps (such as land charges) are taken to protect HMRC’s claim. They will ask for written undertakings to pay the tax within a specified period before allowing the grant. When the form IHT421 is issued STS will mark the file cover to show that a grant on credit has been obtained. The file will be processed in the normal way, but STS will keep details of the case in a separate sub-file. They will monitor the case and make sure that the undertakings are met within the specified period. When the tax that was due on delivery of the account has been paid they will make sure that any land charges are lifted. The STS sub-file will then be closed and sent to the death file.