Liabilities: general background on deducting liabilities
The general rule is that we allow a deduction for debts that the deceased actually owed at the date of death.
A debt for Inheritance Tax purposes is one that can be legally enforced (IHTM28383) and is either:
- imposed by law, or
- a debt for which consideration (IHTM28382) was received.
More details on the legal background to deducting liabilities can be found at IHTM28381.