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HMRC internal manual

Inheritance Tax Manual

From
HM Revenue & Customs
Updated
, see all updates

Payment methods: payment by national savings or government stock

Executors can pay some or all of the inheritance tax due on delivery of an inheritance tax account (IHTM10011) before probate or confirmation is obtained by using National Savings Investments or British Government Stock owned by the deceased.

You should refer any request to pay by National Savings or British Government Stock with the inheritance tax account and file to the Pre-grant team who will apply for the funds.

Before a letter can be issued to either National Savings or Computershare for the funds the parties must provide the following

For National Savings

  • A letter detailing the investments to be used and confirmation of how much of the tax is to be paid by National Savings
  • Official letters from the relevant National Savings office stating the value of those investmentsFor British Government Stock

  • A letter detailing the investments to be used and confirmation of how much of the tax is to be paid by the Government StockOn receipt of the request the Pre Grant team will send a letter to National Savings or Computershare requesting funds and attaching copies of the above documents.

If the funds cover all the tax and interest payable the IHT421/C1 will be stamped and issued to the parties on the same day. The file will be marked with review date for payment and passed on to the next stage.

If the National Savings or British Government Stock is only paying part of the tax and the remainder is to be paid by the Direct Payment Scheme retain IHT421/C1 until these payments have been received.