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HMRC internal manual

Inheritance Tax Manual

Succession: Legal rights Scottish Prior and Legal rights: Death of potential claimant

If the potential claimant has died entitled to claim legal rights (IHTM12221) in the estate of someone who died before them, without claiming or discharging (IHTM12229) these rights, their executors are entitled to claim or discharge these rights. Generally executors have a duty to maximise the value of the deceased person’s estate, but other considerations might justify their discharge of the deceased’s legal rights entitlement.

For Inheritance Tax purposes, where there has been neither a formal discharge of legal rights nor a true election between testamentary benefits and legal rights, the deceased’s legal rights are part of their estate (IHTM04031) and will need to be valued (IHTM10302) and dealt with in the normal way. The only exception to this is where the deceased was under the age of 18 at death. Here, the provisions of IHTA84/S147 (7) apply and if the executors renounce a claim to legitim, the amount renounced does not form part of the deceased’s estate.

If there was scope for an election and the person entitled has died before exercising it (either expressly or by implication), their executors are entitled (if there is no question of insolvency or abatement of legacies) to exercise the election between legal rights and the testamentary provisions, with the same considerations in mind as would have influenced that person had they been alive. You should refer any case where this applies and the tax at stake is worthwhile to Technical.