Reduced account: incorrect delivery of a reduced account
The following are examples of approaches to adopt when the estate does not meet the conditions (IHTM10472) for delivery of a reduced account.
Example 1 (Gross estate exceeds the threshold)
The Will leaves pecuniary legacies of £50,000 to grandchildren, a bequest to a child of a farm worth £200,000 against which 100% agricultural relief is deducted and the residue to the spouse or civil partner (IHTM11032). The estate is not taxable, but the gross value of property passing under the Will to chargeable beneficiaries exceeds the threshold so a full account should be delivered.
You should not automatically ask for all the missing schedules to be delivered. Review the case and, while explaining why a full account should have been delivered (and reserving the right to do so if required), only ask the personal representatives for essential schedules to be delivered. In this example these are likely to be forms IHT405 and IHT414. If it turns out that there is no tax to pay you should follow the usual procedures for telling the personal representatives that we have no further questions to raise on the estate. Where it seems that tax is likely to be payable, you should ask for all the relevant supplementary pages to be completed.
Example 2 (Tax is due)
If the initial risk assessment process identifies an account where it is clear that there is tax to pay, the file will be referred to Service or Compliance. You should ask for all the relevant schedules to be completed and delivered and explain why a full account should have been delivered in the first place.
Example 3 (Estate becomes taxable)
If during the enquiry it becomes clear that the estate is taxable you should use your judgement about whether to call for all the relevant schedules that are needed to make up a full account. This sort of situation might follow, for example, enquiries into lifetime gifts or an increase in value of other chargeable items.
In some situations the incorrect delivery of a reduced account may result in a penalty (IHTM10477).
Calling for missing pages is not an enquiry (IHTM29013).